WebEx founder backs Sharepoint killer Huddle

UK based enterprise cloud collaboration vendor Huddle is taking over where collaboration pioneer WebEx left off after its ill-fated acquisition by Cisco, gaining market share at the expense of Sharepoint.
Written by Phil Wainewright, Contributor

To me, the most interesting aspect of the $24 million C round announced by cloud collaboration provider Huddle today is the participation of Subrah Iyar, the founding CEO of WebEx, one of the earliest cloud application companies to go public before its $3.2 billion acquisition by Cisco in 2007. UK-based Huddle may not be so well known as other vendors in the space, but Iyar's backing is an endorsement from one of the earliest pioneers of cloud collaboration, someone who has 'been there and done that' as the saying goes, and has the scars to prove it.

I was following WebEx closely at the time it bought another company I knew well, Intranets.com, which as its name implies was offering online enterprise collaboration in the cloud as early as 1999. That acquisition in turn became the foundation for the launch of WebEx Connect, an ambitious collaboration platform that was once viewed as a serious rival to Salesforce.com's AppExchange. The problem with Connect was that it took a peer-to-peer approach (similar to Ray Ozzie's Groove Networks at the time, which Microsoft had acquired in 2005) that left it fatally hardwired into individual enterprise networks. The engineering challenges that arose from this then got mired in the Cisco machine, where it ultimately died.

Fast forward five years and what Iyar sees in Huddle is a fulfilment of those original aspirations at WebEx. "He saw our business and immediately understood what we're trying to do," Huddle's CEO Alastair Mitchell told me in a briefing earlier this week. "In his words, 'You're following on from where we left off,' especially WebEx Connect." In particular, the Huddle Sync technology, announced in February, allows Huddle to deliver centrally managed access to local files in a loosely coupled model that avoids getting mired in behind-the-firewall infrastructure.

This is fundamental to Huddle's challenge to Microsoft's Sharepoint platform, which is its main competitive target in the market. "Cloud has matured to the point where it can deliver now on the original vision and it's why Sharepoint will never win in the long term," Mitchell told me. "[Sharepoint] is architected for the client-server generation of technology and that's fundamentally not the way the world works anymore."

In support of that contention, Mitchell cites the example of a Huddle customer that had 2,000 Sharepoint users but saw many other people in the organisation using cloud based tools to share documents. The choice was between embarking on a huge project to implement Sharepoint for 85,000 users across the organisation or signing up with Huddle to deliver that capability on demand. This is typical of the type of scenario that is helping Huddle grow its enterprise business by a factor of five to eight times annually, says Mitchell. "The CIO gets involved and says let's not upgrade Sharepoint next year. Let's actually switch people to Huddle."

With its headquarters offices overlooking London's Silicon Roundabout, Huddle isn't numbered among the Silicon Valley glitterati but should not be discounted on that score. It has now raised a total of $40 million in venture funding and, although it has not raised as much as more consumer-focused rivals such as Box and Dropbox, its C round is larger than Silicon Valley darling Box at an equivalent stage. What's more, Huddle's business is generating cashflow and, as Mitchell put it when we spoke on Monday, "We don't have to do this to survive." Huddle's business was already tripling annually and the funding allows it to invest in further growth, especially in the US and other international markets.

Maybe, as I've said before, as a Brit based in London I'm over enthusiastic to cheerlead for a home-grown cloud success story — Mitchell was the opening keynote at yesterday's EuroCloud Day London event, which focused on cloud growth success stories — but I have a certain track record on predictions and my forecast is that this company is one to reckon with.

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