Box aims to use platform to crack vertical markets
Box has launched its OneCloud suite to bolster its platform and mobile strategies and it may just open a lot of vertical doors for the company to expand its enterprise footprint.
The biggest takeaway regarding OneCloud isn't necessarily storage as much as it is the windows it can open to verticals in conjunction with its enterprise developer program. The OneCloud effort inspired a series of questions about Box's platform. As a result, independent software vendors are hooking Box up with their financial, healthcare and other industry specific apps.
Given partnerships with NetSuite, Salesforce, VMware and a host of others as well as big venture backers, Box has all the ingredients to be a horizontal service that extends into vertical markets.
We caught up with Christopher Yeh, vice president of platform at Box, which has raised $162 million in VC funding so far, to talk shop.
Here's a look at the highlights:
Reaching new industries. Box is a horizontal service that's well known in the Silicon Valley. Yeh was in New York and getting a bit of perspective from industries that represent growth for Box but don't know the company that well. Box has built up a group on the East Coast to focus on financial services and media firms (New York) as well as pharmaceutical and healthcare companies (New Jersey).
How to reach those industries? Yeh said the developer network for Box is critical. Box can focus on the core technology, but it can't developer vertical services specifically. "We want a vertical presence, but don't want to develop specific industry products ourselves," said Yeh.
Financial services use case for Box. Yeh said that in financial services, Box is primarily used for sales collateral that can be delivered to iPads in the field. Beyond that use, financial services cloud adoption is tricky, said Yeh.
"Financial services are not cutting wholesale to the cloud process," said Yeh. "It's hybrid cloud as they move into a comfort zone with the public cloud. We're seeing more requests than we did." Financial services firms also are creating systems that stop sensitive data from leaving the firewall.
Healthcare. Privacy and data requirements also require Box to jump through a few hoops to win accounts. As a results, Yeh said Box plans to put a redirection layer in its system that will allow third parties to add data loss protection apps as well as comply with regulations.
The role of OneCloud. Yeh said OneCloud is suited for verticals such as law firms, which frequently swap and annotate documents. The OneCloud process could be greatly improved. The file system on Apple's iOS makes it difficult to save to the cloud. It's easier on Android, but Yeh's demonstration revealed that the process of saving to Box can be streamlined.
Allaying security concerns. Yeh said that Box undergoes quarterly penetration (pen) tests at the requests of clients and prospects. Hackers come in and try and crack Box. Yeh said that companies also want to hold their encryption keys for documents in Box, which encrypts files. "There's a level of scrutiny about the cloud and security within IT departments," said Yeh. He added that companies have been asking to hold encryption keys over the last four to five months.
Would going public allay potential customer concerns? Yeh said enterprises view Box as a medium sized to large cloud storage player. After all, Box has raised as much as some companies do after an IPO. "But we have some growing up to do," said Yeh.