Alfresco

Now At 5.6M Users, Alfresco Takes On Dropbox With New Consumer Cloud, Eyes 2013 IPO

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You may not have heard about Alfresco. As an open-source enterprise content management platform, the company is not exactly in the sexiest space. Not only that, but although it found some early buzz among open-source advocates, Alfresco has intentionally avoided a lot of press, choosing to fly under the radar. This is a bit surprising for a company that claims to be one of the largest open-source players out there, with 5.6 million users spread across 161,000 companies, and which saw just under $100 million in revenues in 2011.

In fact, its growth has management eyeing a potential IPO in 2013 (if not before), and today, the company is pulling the trigger on a potentially big product: The Alfresco Cloud. As an enterprise-grade collaboration platform, Alfresco is turning downstream and getting into the consumer cloud game, with the hopes of nabbing some market share from Dropbox and Box.net.

So, uh, where did Alfresco come from? Back in 2005, Documentum Co-founder John Newton and former COO of Business Objects John Powell pooled their collective enterprise software experience, recruited a handful of engineers from Documentum and Oracle, and founded Alfresco. If you’re familiar with consumer-facing content management systems (CMSes) like WordPress and Joomla, then you can get a sense of what enterprise content management (ECM), and by extension Alfresco, is all about.

Of course, with an important distinction: Alfresco is an open-source alternative for enterprise content management, coupling the innovative potential of open source with the stability of an enterprise-grade platform. The startup went on to raise $20 million in venture funding from Accel, Mayfield and SAP Ventures by 2008, using the financing to capitalize on the market disruption being caused by open-source CMSes, which were (and are) providing an appealing, web-based alternative to document-based, enterprise applications.

As cloud computing took off, open-source technologies began to see increasing adoption in enterprise, Alfresco was able to ride this wave, although it has remained largely under the radar over the past few years — in spite of some impressive growth and adoption.

Today, the company claims to be the second largest open-source company in the world, after Red Hat, with 5.6 million users spread across 161,000 companies — 77 percent (about 4.3 million) of which are paying customers. To put this in context, Yammer, the enterprise social network and Silicon Valley darling (which just raised $85 million), recently announced their end-of-year stats, disclosing 4 million users and 800K paying customers.

Alfresco has more than 250 channel partners worldwide, with 50 percent of its business coming from international customers (part of the reason Alfresco has remained under the radar in the U.S.), and, according to the co-founders, is seeing just under $100 million in annual revenues. Beyond that the company is reportedly seeing steady subscription growth, with a 90 percent renewal rate, and as such, is expanding its staff by 50 percent this year. All of which is leading the co-founders to begin targeting that aforementioned IPO — at some point in 2013 — if not before.

It is on the heels of this momentum that the company is today launching the Alfresco Cloud. Thus far, Alfresco has been an on-premise-only solution, but with its new cloud offering, Alfresco doesn’t just want to be an on-premise solution ported to the cloud, it wants to launch a whole new product, streamlined and optimized for customers who want cloud products, with both a consumer-ized UI/UX that works on mobile and tablets and includes native apps for all platforms.

This means that users get to use the same drag and drop upload (of any file type) functionality, with the ability to preview files in the browser, start tasks and workflows, as well as take advantage of social features, like “following” the best content creators, “liking” your favorite documents, and viewing content activity streams.

Alfresco Cloud also works on any mobile device via the browser or through its free, native iPad and iPhone apps so that you can edit, annotate, and access your documents from anywhere, while taking advantage of a private, secure, enterprise-grade solution. While the cloud offers a private collaboration network for your company — and enables users to set up content sites for small teams — they can still invite company colleagues or external users — even free/public email addresses.

If, for example, your team is working on a new presentation with your ad agency, you can simply set up a private site, and invite users to it with an email address. External users only have access to sites they’re invited to, and termination is easy if users get unruly.

As to pricing, standard Alfresco content collaboration networks are free and include 10GB of storage and unlimited users from a single company domain. Users can also create multiple collaboration sites with free lifetime usage as long as they stay under the 10GB max. The cloud is currently in private beta, but the team plans to offer premium Team or Enterprise networks that will include more support, storage, higher file size limits, admin features, custom branding, etc. The team networks will likely start at under $10 per user, per month, and scale up from there.

In the big picture, it will be really interesting to see if this has any effect on the cloud market. Both Box.net and Dropbox have received a lot of buzz over the last year, as each have quality products, teams, and leadership. Both companies also have ambitions to go beyond consumers and SMBs to attack the enterprise market, but they’re moving upstream in doing so. Alfresco on the other hand, while certainly under the radar and more international, has become one of the leaders in open-source content management.

Now, they are, in a sense, consumerizing themselves, working downstream into Box.net/Dropbox territory. So, could it be that the biggest threat to Dropbox will come from upstream? Farhad Manjoo certainly thinks that there are plenty of holes left in the Dropbox model, even if it is a terrific tool. Is it true that you can only trick out a cheaper car so much before you just want to switch over to a BMW? Does Alfresco even qualify? You be the judge, but they certainly think they’re onto something, and that the consumer file-sharing clouds have something to be nervous about.

For readers who want to check out Alfresco in the cloud, navigate over here, and we’ve been assured that TC readers will get to jump the front of the line. Because you’re cool like that.