Open source companies to watch

Newcomers focusing on everything from a Microsoft Exchange rival to server virtualization and data integration

Open source is being increasingly adopted by enterprises as low-cost solutions for a variety of technical needs. This story highlights eight developing open source projects that are worth watching.

Why is it worth watching? Apatar makes it easier to form partnerships by more effectively sharing data across applications, says Nucleus Research Vice President Rebecca Wetteman. “With the proliferation of on-demand applications, there is a lot of valuable data — and potential partnerships — out there on the Web,” she says. “But it’s hard to form partnerships, because data integration between the enterprise and Web-based applications is difficult. Apatar bridges this gap by [eliminating duplicate data], filtering, naming and storing Web-based data.”

How did the company get its start? CEO Renat Khasanshyn previously headed Altoros Systems, which ran projects for customers who needed integration between databases and applications but could not afford expensive data-integration tools from vendors like IBM and Informatica. Altoros’ work was done manually and was thus error-prone and ineffective in the long run, Khasanshyn says. He became convinced that cost-conscious businesses would use an open source data-integration solution based on software tools rather than manual coding.

How did the company get its name? By Khasanshyn’s own admission, the name was inspired by “boring marketing research.” “About five short names, with six characters or less, which start with ‘A’, [are] easy to remember and have a .com, [or] .org domains available were offered for voting to about 20 people,” he says.

“They were asked to select the most attractive and easy to remember name. Although Apatar was not the leader most of the time, it demonstrated consistent results [second or third choice] in more than 70% of the votes.”

CEO and background: Khasanshyn, who immigrated to the United States in 2001, was vice president of engineering at PriMed, a discount insurance company in Tampa, Fla., and CEO of Altoros Systems, a distributed product life-cycle management company.

Funding: $500,000 from Altoros, Khasanshyn and co-founder Andrei Yurkevich.

Who’s using the product? 250 users, including Autodesk, Kenya.com and R.R. Donnelley.

Company name: Collaborative Software Initiative

Founded: February 2007

Location: Portland, Ore.

What does the company offer? CSI is developing applications collaboratively with groups of companies that normally compete against each other, such as banks. The plan is to create essential but noncompetitive software tools that can be used across an industry, and offer code maintenance and support. The first application, expected to be released in the fall, will be an online questionnaire that helps banks comply with security regulations.

Why is it worth watching? CSI’s open source development model will allow companies to save money by more efficiently creating applications that are needed by competitors but don’t create a competitive advantage. “As we move toward this idea that a lot of . . . what we’re looking for in IT is more similar than it is different, and we start to find commonality around things like vertical customization, it makes sense to try to drive down the costs by cooperating with other folks trying to solve the same problem,” says Forrester analyst Rob Koplowitz.

How did the company get its start? Stuart Cohen, former CEO of the Open Source Development Labs, founded CSI after several large banks and insurance companies approached him and said they wanted to collaborate on open source applications.

How did the company get its name? The words “collaborative” and “software” have obvious links to the company’s development model. Cohen chose the word “initiative” instead of “Company” or “Inc.” to indicate a new way of doing business.

CEO and background: Cohen most recently spent four years as CEO of the Open Source Development Labs, which became the Linux Foundation after a merger. Cohen worked for IBM for 17 years in sales, marketing and brand management, and later held positions at RadiSys and InFocus.

Funding: $1 million from OVP Venture Partners.

Who will use the products? The banks and insurance companies that approached Cohen include Bank of America, Morgan Stanley, and MetLife. Cohen has also talked to numerous government agencies about developing applications.

Company name: Mindquarry

Founded: July 2006

Location: Potsdam, Germany

What does the company offer? Collaboration software known as Mindquarry DO, which was released in February and includes file sharing, wiki editing and task management. Mindquarry recently announced a software-as-a-service product and an enterprise-class software package including support.

Why is it worth watching? Red Herring named Mindquarry one of the top 100 most innovative private companies in Europe this year, saying it has ambitious plans to compete with Microsoft’s Sharepoint Server and IBM’s Lotus Connections.

Mindquarry’s “open source software package … allows multiple users to simultaneously edit documents or collaborate through instant messaging and email,” Red Herring notes.

How did the company get its start? When co-founder Lars Trieloff wrote a book about the markup language DocBook XML, he realized collaborative projects are often riddled with problems that could be solved by software.

How did the company get its name? The founders say knowledge workers labor as hard as those in a quarry but are “workers of the mind” who need powerful tools for collaboration.

CEO and background: Stephan Voigt was previously CEO of Scopeland Technology, which makes a software platform for creating database applications.

Funding: An undisclosed amount from HassoPlattnerVentures, which is funded by SAP co-founder Hasso Plattner. The three founders of Mindquarry were students at the affiliated Hasso-Plattner-Institute in Potsdam, which trains software engineers.

Who’s using the product? The free open source software has been downloaded more than 15,000 times. 1,500 people have installed the software and registered with the company. Mindquarry says it has three paying customers but can’t yet disclose who they are.

Company name: MuleSource.

Founded: The Mule open source project was released in late 2003, and MuleSource launched in October 2006.

Location: San Francisco

What does the company offer? Support and services for Mule, an integration platform for moving and managing data among disparate enterprise systems. This is useful for anything from service-oriented architecture to connecting internal systems to Salesforce.com.

Why is it worth watching? Big enterprises have invested in hundreds or thousands of applications, and need to quickly develop new services that access and combine data from these incompatible systems, MuleSource argues. The Mule platform is intended to give developers flexible tools for solving this problem.

How did the company get its start? Ross Mason, creator of the Mule open source project and co-founder of MuleSource, developed Mule after doing a major application integration project at an investment bank in London in 2000. He found the project to be an “absolute nightmare” because the tools available to developers were heavyweight, expensive and proprietary.

How did the company get its name? Mason wanted to build a developer tool that would take away the “donkey work” involved in integration projects.

CEO and background: Dave Rosenberg was CIO for Glass Lewis & Co., an investment research and advisory firm, and principal analyst for the Open Source Development Labs.

Funding: $16.5 million from Hummer Winblad Venture Partners, Lightspeed Venture Partners and Morgenthaler Ventures.

Who’s using the product? More than 1,000 organizations worldwide, including Adobe, Comcast, Intel and Northrop Grumman.

Company name: Open-Xchange

Founded: May 2005

Location: Tarrytown, N.Y.

What does the company offer? Products including Open-Xchange Server 5, a platform for e-mail, calendaring, documents, contacts and task management.

Why is it worth watching? The small vendor found the spotlight in February of this year when 1&1 Internet, the world’s largest Web hosting company, said it will use Open-Xchange’s open source software to deploy more than 1 million e-mail accounts. Open-Xchange isn’t posing any major threat to Microsoft, but analysts called the deal an important step for the open source market.

How did the company get its start? The founders’ roots go back to Netline in Germany, which added its collaborative software to the SUSE Linux Openexchange Server. They later decided to move to an open source development model and make the software available to customers independent of Linux distribution.

How did the company get its name? Founders wanted to show continuity with the software’s previous incarnation as part of the SUSE Linux Openexchange Server. The company says the name’s similarity to Microsoft Exchange is “purely coincidence.”

CEO and background: Jerry Labie was most recently president and CEO of CXO Systems, an enterprise software vendor bought by Cisco. Before that he was president and COO of Novadigm, a system management software vendor acquired by HP.

Funding: Investments (amount not disclosed) from Robert A. Young, a venture capitalist and investment banker; retired IBM executive Lee Dayton; Richard Seibt, the former head of Suse; and BayTech Venture Capital.

Who’s using the product? More than 2,000 companies in 65 nations.

Company name: Pleyo

Founded: April 2006

Location: Montpellier, France

What does the company offer? OWB, an open source Web browser designed for mobile phones, portable media players, set top boxes and other consumer electronic products. Pleyo released OWB in July and plans more Web services for consumer electronics.

Why is it worth watching? Pleyo hasn’t launched publicly yet, but says it has developed “reference implementations” of its Web browser on cell phones, high-end mobile devices like the Nokia N800, stand-alone media centers and a television.

How did the company get its start? With the introduction of the iPhone, the founders say the market for Web-based solutions on consumer devices is quickly maturing and that Web 2.0 technologies should be more widely available on these products.

How did the company get its name? Pleyo is a variation on the word “play,” for entertainment, and the “o” is supposed to resemble a video screen.

CEO and background: Joel Reboul was founder and CEO of eProcess, a software editor for consumer electrics devices, which merged with Teamlog-DMS to become Iwedia.

Funding: Currently self-funded. The first round of external funding is expected in the fourth quarter.

Who’s using the product? The browser has been downloaded 544 times, mostly by research and development departments from various industries, according to Pleyo.

Company name: Talend

Founded: August 2005. The vendor’s first product came out in October 2006.

Location: Suresnes, France, with additional offices in California

What does the company offer? A data-integration platform known as Open Studio, and a software-as-a-service offering called Talend On Demand.

Why is it worth watching? Talend is jumping on two of the hot software trends in open source and software as a service. Customers looking to save money should feel safe going to an open source vendor because data-integration products tend to be similar in terms of functionality, Forrester analyst Michael Goulde has said.

How did the company get its start? Co-founders Bertrand Diard and Fabrice Bonan were managing the data-integration practice for a large systems integrator, using proprietary data-integration technologies from Informatica, IBM and Business Objects. They decided there should be a more flexible and open way to pursue data integration, so they developed an open source product.

How did the company get its name? The founders wanted to include the letters ETL, which stands for extract, transform and load in the data-integration market. They put the letter “D” at the end to signify that they perform integration differently than pre-existing vendors.

CEO and background: Diard was the business manager at a European systems integrator, and in 1999 co-founded a software company specializing in real-time 3D animation.

Funding: $7 million from AGF Private Equity and Galileo Partners.

Who’s using the product? Customers include Monster.com, ETAI, University of Toulouse, SEMIDEP, Accor, BTD ClearViews, SNCF French Railways, and Swissport.

Company name: Wikia

Founded: November 2004

Location: San Mateo, Calif., and New York

What does the company offer? Founded by Jimmy Wales of Wikipedia, Wikia makes this list because it is building an open source search engine that should be available by the end of 2007. The project got a boost in July when Wikia bought Grub, an open source tool that will help Wikia build an index of the Web. With Grub, Wikia is able to offload the cost of crawling the Web to volunteers who download the Grub program.

Why is it worth watching? Wikia’s project will allow people to build search engines even if they lack the financial resources of a large corporation. Wikia CEO Gil Penchina believes this will vastly increase the number of specialty search sites focusing on specific topics, such as medicine. Wikia will also use the code to host its own public-facing search site.

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