Five Facts about Mendix, Another Cloud Enterprise App Startup

3/20/12Follow @xconomy

Take a look at Mendix and you’ll see some oft-buzzed-about themes. It’s a platform-as-a-service company that’s looking to disrupt the existing world of enterprise IT. Its technology is built around the cloud. And it’s located in Boston’s “Innovation District”

Mendix was dreamt up by CEO Derek Roos as a means for employees at big companies to avoid dealing with the red tape in corporate IT departments every time they wanted to get a new piece of software or an update to a system they needed to do their job. Instead, they just ask Mendix to create it for them.

Customers can log onto the Mendix platform from any location and describe what they’re looking their new application to have in terms of function and features. The Mendix technology pops out a demo version of the app within minutes, which customers can review and suggest tweaks and fixes for right away. A final version of the technology is typically ready for their use in days.

“We can sit next to a user, capture these requirements in the app on the spot, and deploy to the cloud,” says Roos. “We push a button, it works. There’s no big contract. The risk of building apps, and also buying apps, has completely changed, because it’s so fast you don’t need to think about it for weeks or months.”

That’s the nuts and bolts of the Mendix technology, but I pulled out some key facts worth noting about the company and how it’s working to stand out among all the others working in the cloud.

—It just moved its headquarters to Boston from the Netherlands
“With the funding and the maturity of the product, we made the decision to step on the gas and move our commercial office here to focus on the U.S market as a primary market,” says Roos. That means Roos, along with Mendix’s vice president of sales and of its VP of marketing moved in January from the Rotterdam headquarters to an office on Congress Street.

Boston and San Francisco were both options for the U.S. headquarters, but Boston’s proximity to Europe, university talent, and Mendix’s financial services clients in Hartford, CT, and New York gave the East Coast city the edge. There are about a dozen employees in the Boston office now, but that number is set to hit 30 by the end of this year, as Mendix is planning to hire staff in customer engagement, marketing, sales, and graphic design.

—Launched in 2006, Mendix didn’t raise a major funding round until last fall
Mendix raised its first ever venture funding in October, with a $13 million Series A financing led by growth equity firm Prime Ventures, with participation by its seed investor HENQ Invest. The company was cash flow positive early on, says Roos, and had grown to 100 employees across four countries (the U.S., the Netherlands, the U.K., and South Africa).

“We came at a point where the product was mature enough to really accelerate in combination with a market that was really waking up to the notion of apps vs. enterprise systems,” says Roos. That money has helped Mendix double its R&D efforts, expand in the U.S., and build a global support team, he says.

—Mendix’s technology is “all about time to market and simplifying app delivery as opposed to providing a hosting platform for code.”
That was Roos’ response when I asked him what makes Mendix different from other local companies, such as CloudBees (which my colleague Greg wrote about last month), offering app services in the cloud. Mendix’s focus is on the non-techie employees who need applications faster than IT departments can build or source them. “It’s vendor hell. Coding hell. There’s nothing wrong with coding, but it has nothing to do with the business,” says Roos of how company IT departments typically function.

Roos thought the process of working with IT on the job should be as easy as dealing with Facebook after work, so he focused on building his company’s software with social features. Many of the Mendix apps for clients start within an app store, which builds on projects done for previous customers. And each app has an activity stream with it, similar to social media feeds you’d see on Facebook and Twitter.

—-It’s looking to work alongside existing software giants, not unseat them
Mendix’s primary customer target is midcap-and-up enterprises. “The more existing systems they have, the more rigidity, the more pain, the better,” says Roos

Mendix’s technology works by building apps as a layer on top of existing systems, so it’s not worried about putting big names in business software out of business. (That’s another differentiator from CloudBees, which is trying to disrupt software providers like Oracle, IBM, and VMware.)

For example, one of Mendix’s clients is a big insurance company that uses SAP software to manage some of its HR processes. Mendix helped build mobile applications atop that system that give employees easier access to do things like request time off and submit timesheets.

—The vision is big
Mendix sees the old world of doing everything through corporate IT departments as expensive, exclusive, and cumbersome. Its platform, by contrast, enables it to work with customers on small projects one at a time, for which the company charges a monthly fee without requiring them to shut out one vendor in favor of another.

“We really see it as a before and after. Right now we’re at an interesting time where enterprises are waking up to that mega trend of cloud as an enabler and the notion of apps,” Roos says. “We apply the idea of apps to the enterprise, and it’s a totally different universe of opportunities.”

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