Multiple Pivots, Taking on Giants, to Over $100 Million in Revenue: Matthew Calkins, CEO of Appian (Part 6)

Sramana Mitra: Interesting. So you closed the $10 million round before the financial crisis on a questionable business plan. What happens next?

Matthew Calkins: It’s an odd journey. Now we have $10 million and we could be strategic. That felt very nice because there was so much we wanted to do. We’ve always been an ideas company and we had such plans. Finally, we had this moment to breathe and invest. The thing we decided to build was an exceptionally simple and elegant interface. This stems from our belief that BPM is hobbled by its complexity.

Processes should be simple and if they’re not, people won’t participate voluntarily. If they don’t, then only the people whose job it is will ever be a user of BPM. I wanted BPM to be an easy, attractive, and unifying experience whereas it was an exclusive, irritating, and dis-unifying experience. The first thing we did when we got this money is begin to develop what we called the Tempo interface.

In the past, BPM looked very much like a portal which is where we had come from. However, the interface had a skeleton. It had divisions. It had boxes and you could fill the boxes, but you had to deal with the skeletal structure all around it. I wanted something very different. I wanted a liquid interface that would fill whatever space it was put in. I wanted interface that was made up of lists like an Inbox. It didn’t matter what size your monitor was. It could just adapt. Of course, we wanted to do this on mobile devices. We wanted to make it so that everyone would understand it.

A time-sorted list of items of information seemed like the way to go. At this point, it was quite obvious that that was what we wanted to do but back then, it was the thinking that if you were doing BPM, you need to see four things at the same time, so there better be four boxes on your screen. We wanted to break away from that. It’s my belief that an interface should focus on the one thing that the user specified that they care about at this moment. You should just be able to hone in on that. We didn’t like the skeleton because it didn’t port very well.

We created this liquid interface and simplified it as much as possible, and made it seem like a modern feed. That was very popular. So was the thin interface ported to the cloud. Soon after that our interface was used on mobile devices. We were a natural for mobile. BPM is perfect because you specify an application once and then you can consume it anywhere. After all, BPM is just the interpretation of a model into an application. By all means, we should be interpreting it into an application on every platform. It should work natively on a tablet or a phone. If you tip it from portrait to landscape, it should adapt perfectly. There’s not any reason why the interface shouldn’t render perfectly. We were early on that breakthrough as well. With just a little bit of money, we were able to make a series of strategic breakthroughs. Our market share appreciated.

We did have to sail through the recession. That slowed us down a little bit. Interestingly, it actually accelerated groth of our biggest competitor Pegasus Systems. They did very well in the downturn. I think it’s because the banks had money to spend and were exceptionally motivated to find a solution. I don’t know. I wasn’t inside their business. For us, the recession was a challenge. It slowed us down a little bit, but we still grew.

We were building a product that we were more convinced than ever was a winner. We kept doing that. That was 2008. Every year after that, we would come out with some breakthrough that the rest of the market didn’t have. As we were doing this, our competitors were falling by the way. They were finally running out of their mountain of cash that they had been spending all these years. They were looking for an exit. They had impatient investors. Of course, none of them controlled their destiny. They sold that for the stock pile which was now gone. Our competitors were falling away. We were getting more of the spotlight, partly, because of that. We had a better market position, a better product, and we’re getting a higher profile. When we had money, we spent it on R&D.

Sramana Mitra: You said there were three major competitors. At what point did they all fold?

Matthew Calkins: I’m going to say it was around 2010. There was a period of three years in which they all disappeared. I shouldn’t actually say disappeared. Lombardi was acquired by IBM, which attempted to be our new biggest competitor, but they weren’t willing to innovate. Savvion was acquired by Progress Software which did nothing with it. They struggled on. None of them were the same.

Lombardi was the strongest post-acquisition but none of them stayed vibrant. Lombardi had been our strongest competitor in terms of innovation. They sharply decreased their innovation post-acquisition. It was clear to us that we were going to win the innovative space in this market, particularly, when Lombardi was acquired. What we needed mostly was for a few trees to fall so that more sunlight could get to our branches. That happened for financial reasons, largely. It also shed more light on the strength of the solution that we had built.

There was less of a quorum to resolve BPM, which meant something other than what we wanted it to mean. We were always an iconoclast. Our vision of what BPM should be was completely dismissed by Lombardi, Savvion, and others who all had their own conforming view of what it should be. It was very good for us that that quorum dissolved, and our voice became proportionally louder. I always thought we had the best ideas but now we were getting more of a hearing.

This segment is part 6 in the series : Multiple Pivots, Taking on Giants, to Over $100 Million in Revenue: Matthew Calkins, CEO of Appian
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