There are few people I would get up to meet on a Sunday morning after spending five weeks on the road and mired in China-to-SFO jet lag. There are also few people I would believe when they said they were building a great “Enterprise 2.0” company. Tony Zingale is one of those people.
We’ll get to why in a moment. But first the news: Jive Software—a nine year old company that Zingale became CEO of in February on an interim basis—is launching two new products today and continuing a big press push that’s tantamount to announcing they are a serious, next-generation enterprise software company. (He’s also recently dropped “interim” from his title, the CEO equivalent moving out of beta.)
The company operates fully-featured social networks for businesses that change how people inside the company work and communicate, and how they interact with their external partners and customers. Bolstering the news are some impressive partnerships: Jive will integrate LinkedIn profiles into the site, license the full Twitter firehose of Tweets and offer a free month trial of its service in Google’s App Marketplace. Jive is funded by Sequoia Capital; our previous coverage is here.
Feature-wise the company is launching a App Marketplace (who isn’t?) and a “What Matters” product that’s like a corporate news feed. Data from existing business collaboration tools not to mention LinkedIn and Twitter will be pulled up and the most relevant pieces of data will be abstracted from the what-you-had-for-dinner-last-night noise.
I am incredibly skeptical about the whole “enterprise 2.0” shtick but Zingale isn’t screwing around with some feel-good freemium model. He’s doing sales in the range of $75,000-$150,000 per company, on average, but the dollar amount is increasing. He’s done ten $1 million deals and four of those came in the last two quarters. The company has 3,000 customers, 15 million users, and will end the year on a $100 million run-rate. Considering that a few years ago open source darlings like Jboss were valued at hundreds-of-millions of dollars when they were doing less than $50 million in revenue, that’s a decent software business.
The other reason I’ll give Jive the benefit of the doubt is Zingale. He is a man who has proven the difference between being lucky and being good. Sure, he benefited from the glory days of the business software boom early his career—when a lot of people looked smarter than they were because the world had billions to spend on Greenfield software opportunities. But he’s also
navigated a lot of unforeseen challenges. He was the no. 2 guy at Cadence Design Systems back when it had its worst quarter in history and some of its employees stole its core software to start Avanti. In 1997 he came into turn around CRM company Clarify and sold it to Nortel for $2 billion. He could have ridden off into retirement after that. Instead, in 2004 Zingale inadvertently took on his most brutal challenge yet.
He’d just become President and COO of Mercury Interactive with the understanding he’d become the CEO in about six months. The company missed the first quarter in 2005. Uh oh. Then it barely made the second quarter. Not great, but could be worse. These were not exactly enterprise software’s glory days. Then, SEC investigators showed up. Oh, shit. Mercury was proven to be one of the egregious abusers of the options backdating scandals that rocked the tech markets in 2005 and was made one of the biggest scapegoats. Zingale had nothing to do with this— he was on the board of the company but not when it went happened. But he didn’t abandon ship. He quickly fired the people who’d hired him, and he took the CEO job over a few months earlier than anticipated.
I called him for an interview when the November 2005 Mercury bombshell hit. I was covering software for BusinessWeek and this was one of the hottest stories of the week. Most CEOs would have said “No comment.” But Zingale—who I’d met just once at an industry dinner— invited me in and we had a frank face-to-face conversation about the situation. He looked me in the eye, told me he had nothing to do with this and how he was going to save this company, and I believed him. He spent much of the rest of the year having the same come-to-Jesus meetings with every shareholder and major Mercury customer. Less than a year later, he sold the company to Hewlett Packard for a $5.1 billion—a 50% premium. Meanwhile a host of hot 1990s software companies who hadn’t had Mercury’s legal troubles were walking dead.
Simply put, Zingale is a bad ass. He is one of those rare old-school software salesmen who also comes across as genuine. And he’s beyond battle-tested, pulling a de-listed, radioactive company back from the dead to be worth $5 billion.
It’ll take someone like that to actually create a company out of all this Enterprise 2.0 hype. And I hope he can pull it off, because Silicon Valley is desperately in need of an enterprise software resurrection.
One thing is certain: Jive will either be raising more money in the future or filing to go public as soon as it can. Zingale has a big vision here and building a real enterprise software company takes cash.
Jive is the largest and fastest growing independent vendor in the Social Business Software market. Jive allows companies to engage employees, customers, and the social web. Just as social technologies have changed our personal lives, Social Business is changing how enterprises get work done. The company was founded in 2001, with its headquarters in Palo Alto, CA and offices in Portland, OR; Boulder, CO; Brentford, United Kingdom; and Frankfurt, Germany. Jive combines the power of community software, collaboration software,...