Socialtext gets new CEO and $9.5 million in funding
Socialtext co-founder Ross Mayfield has stepped down as CEO of the enterprise wiki company and is handing the reins to Eugene Lee, a well-seasoned tech executive who has spent time at Adobe, Cisco, Banyan Systems and was a co-founder of Beyond Inc. (acquired by Banyan). Mayfield will maintain chairman and president titles.
"I have an incurable entrepreneurial and innovation bug and it's hard to partake of it in companies like Cisco and Adobe," Lee added. "We have a lot of unfinished business in this space."
Mayfield said he will focus more on working closely with customers. "This change doesn't mean I'll have more time to blog. I'll focus on some specific customers and strategic projects. [The transition] came at natural scaling point--at 50 people. Now I can focus on things I am better at."
About 4,000 organizations use Socialtext (many use the open source version but the company doesn't disclose which are paying customers) software and the company recently was listed as a visionary in Gartner's evaluation of the team collaboration space.
Social software is gradually gaining acceptance in corporations, but it's an uphill battle. "The initial argument for ROI is the cost is so small who cares," Mayfield said. "Then anecdotal evidence comes up, but despite religious attempts to the contrary, economic arguments are needed to sell enterprise software." He cited demonstrable value from using Socialtext wikis in call centers as a knowledge base, decreasing average call time by 10 to 20 percent. "Productivity benefits include email reduction by up to 30 percent, accelerating project cycles and taking business processes from approval to publish on the Internet, getting to a single click," he added.
Lee described Socialtext's roadmap going forward as "emergent."
"Co-invention with customers will be key. Priorities are settling into place--accelerating and maximizing customer success," said Lee. Spoken like a typical CEO. It's trite but making customers successful is the way companies are rewarded.
"Customers fit this into the tools they are already using--little things like email integration, for example, are a big deal as well as posting to a wiki from email or a Blackberry or a Miki [mobile optimized wiki] or taking part of a wiki offline," he continued. "This is about fitting into the enterprise workplace and leveraging distributed collaboration and emergent tools and accelerating that success. It might be big or little or intersections with other parts of social software universe."
"We will continue to do conscious and directed innovation," Mayfield added. "We have great customers and business value use cases, not just people writing on wiki whiteboards. It's important for us to remain a thought leader and chart the course for whole category. Times like these go back to when we co-founded the company, creating tools with great social dynamics and adapting to the enterprise."
In addition, Socialtext closed a $9.5 million series C round of funding from Draper Fisher Jurveston, Omidyar Network, SAP Ventures, Intel Capital and some angel investors. Previously, the company had garnered $4.6 million in funding.
The company plans to use its cash infusion to scale out its business. "Right now we can't serve all the demand coming our way," Lee said. "We think we have first mover advantage in some key areas of innovations. We'll have additions in product management and engineering and beef up our professional services and customer support on the back end. Geographic and channel expansion are also planned."
It's also likely that Socialtext will expand its wiki/blog service with additional social software features, such as more extensive user profiles, allowing people to locate people with specific expertise within a corporation.