Ten Leading Open Source Innovators: Page 6

Posted February 21, 2007

Jeff Vance

Jeff Vance

(Page 6 of 10)

6. SugarCRM

Location: Cupertino, CA

Product or service: As its name says, SugarCRM provides open-source CRM applications.

Why it’s innovative: SugarCRM is banking on several current trends: software as a service, adoption of open source in the enterprise, and the penetration of enterprise applications like CRM and SFA into the mid-market.

The service-based architecture helps organizations avoid purchasing expensive “shelf-ware,” or at least minimizes their exposure to unused applications. SugarCRM’s delivery model is tailored to meet various organizational IT needs. The applications can be delivered as a service that is hosted by SugarCRM, as turnkey software housed on enterprise appliances but managed by SugarCRM, or as a server-based application fully managed by the end user.

What’s their track record? Customers include Starbucks, Honeywell, Yahoo, the State of Oregon, NASA Ames Research, AXA Rosenberg, and First Federal Bank. In December 2006, the company announced that it had landed its 1,000th paying customer, and its software had been downloaded over 1,000,000 times.

Funding: In three rounds of funding, SugarCRM has raised $26.52 million from Draper Fisher, New Enterprise Associates, and Walden International.

What are the major obstacles to overcome? The most direct competition comes from Salesforce.com. The differentiator is that SugarCRM is an open-source offering, but that difference may not be as large as it appears at first glance.

Salesforce.com operates in what could be termed a “mixed-source” environment. According to Illuminata analyst Gordon Haff, the line between open source and proprietary can get pretty blurry. “Many open-source licenses don’t require you to fully release your own source code,” he said. “How far do you have to go to be considered truly open source?”

The answer isn’t clear. Is embracing standards and delivering a solid set of APIs enough, or must you release core source code? It’s a debate most end users don’t care that much about, but those in the developer community can get downright religious about it. According to market-research firm Ovum, SugarCRM makes about two-thirds of its source code available to the open-source community.

Another venue of competition between SugarCRM and Salesforce.com is the fact that each supports an application ecosphere, featuring add-on third-party applications that have already been ported to the underlying CRM platform.

Other CRM vendors, such as Siebel Systems, PeopleSoft, and SAP, must also be taken into account.

Management Team: John Roberts, chairman, CEO and co-founder, previously held product management and sales engineering positions at E.piphany, BroadVision, Baan/Aurum Software and IBM. Clint Oram, GM of Sugar Online and co-founder, formerly worked at E.piphany, Octane Software, Hewlett Packard and PG&E. Jacob Taylor, CTO and co-founder, was formerly senior development manager at E.piphany in charge of platform infrastructure and services.

Prior to joining SugarCRM, Yun-Ping Hsu, VP of engineering, was VP engineering and worldwide support at BroadVision. Lars Nordwall, VP of worldwide sales, previously served in a variety of executive sales and professional services roles with Novell. Lila Tretikov, CIO, previously developed telecom solutions for a number of Fortune 500 customers.

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