San Diego’s MindTouch Uses Open Source to Develop Software—and Strategy

9/22/09Follow @bvbigelow

Aaron Fulkerson begins his story about San Diego-based MindTouch in the middle. He says MindTouch today is a Web-based business collaboration and integration platform, with 20 million users and hundreds of thousands of active installations. The company’s software is meant to help engineering groups, business teams, and others collaborate on projects by sharing documents, information, images, and other information.

“Nobody, except maybe Microsoft [Sharepoint], has the installed base that we have,” boasts Fulkerson, the CEO and a MindTouch co-founder. “And we’ve done it entirely through shoestring guerilla social marketing with T-shirts and spending $5,000-a-month on Google ad words.”

Aaron Fulkerson

Aaron Fulkerson

Fulkerson attributes the viral growth rate at MindTouch at least partly to an early decision he made with co-founder and chief technology officer Steve Bjorg to build their business around an open source wiki program. “One of the very important strategies we settled on at the beginning was to make it open source,” Fulkerson says. “We wanted to create an application that was easy-to-use, and in a Web-based environment that enables you to stop losing information and makes it easier to share that information with your colleagues.”

In recent weeks, the company’s collaboration software has ranked from No. 27 to No. 135 on the list of most-popular open source applications at SourceForge.net, the Web-based source code repository for software developers. “Even being consistently ranked in the top 200 open source applications on SourceForge and hitting the top 20 from time to time is a very good thing indeed, seeing that we have over 200,000 projects hosted,” SourceForge director of community Ross Turk writes in an e-mail.

Before launching MindTouch, Fulkerson and Bjorg worked together at Microsoft under then-CTO Craig Mundie in the software goliath’s advanced strategies and policies division in Redmond, WA. “We were working on distributed operating systems,” says Fulkerson, who got his undergraduate degree in computer science from the University of North Carolina at Chapel Hill. “We learned a lot about distributed computing and what to do and what not to do,” Fulkerson says.

One problem that caught their attention was the difficulties that engineering teams and others had in capturing and distributing information within a business enterprise.

“The problem was in office files that get sent off in e-mail, and any changes have to get copied over and over again,” Fulkerson says. “It’s tedious, and doesn’t make sense in a time when everything is Web-based…Can you imagine every time you need a wheel to go through the process of re-inventing the wheel again and again?”

Fulkerson won’t disclose MindTouch’s revenue, but he says the software has been translated into about 20 languages and compares favorably, among some analysts, with much-bigger rivals, which include Microsoft Sharepoint, Oracle, IBM Lotus, and SAP. MindTouch—which has been entirely bootstrapped by the founders—now has about 30 employees, and the company was only founded three years ago.

Fulkerson and Bjorg still face questions, though, which is what led Fulkerson to arrange a presentation tomorrow night at San Diego’s MIT Enterprise Forum. “MindTouch sells tools to IT people and business users within enterprise networks, people who are within individual work groups or the department level,” says Fulkerson. The MindTouch CEO says the MindTouch core product is free and open source. The company also has a commercial product that builds on the core product that is called MindTouch 2009. Corporate customers return to license the more robust and comprehensive version of the company’s collaboration software (a 10-user license is listed at $995)—and therein lies one question.

“MindTouch has kicked ass among the technologists in IT and tech development,” Fulkerson says. “What we intend to do is execute a strategy of going directly to the CIO [chief information officer], and selling a more complete solution to CIOs. So the question is, ‘How do we do that?’ ”

Fulkerson says a secondary question stems from the high percentage of MindTouch users in foreign markets. He estimates that European users account for about 60 percent of the company’s downloads, but generate only about 10 to 15 percent of MindTouch revenues. “So question No. 2 is, ‘How do we go global?’”

In San Diego, the MIT Enterprise Forum serves as a kind of open source tutorial on startups, technology innovation, and entrepreneurship. So after Fulkerson lays out MindTouch’s core business and strategy in his presentation, Ted Alexander of San Diego’s Mission Ventures, is set to convene a panel discussion of the company’s business plan and possible options. The panelists include Christine Benton, who has worked with SAP and other companies as director of Burson-Marsteller’s technology practice; Craig Macdonald, chief marketing officer at San Diego-based Covario, which specializes in software analytics for search engine optimization; and Robert Pryor of InnerTalent, a business coaching service based in Encinitas, CA.

Bruce V. Bigelow is the editor of Xconomy San Diego. You can e-mail him at bbigelow@xconomy.com or call (619) 669-8788 Follow @bvbigelow

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