Transcript: Content collaboration for enterprises with Koral's Mark Suster

This transcript is from a PodTech.net podcast at:
http://www.podtech.net/home/technology/1586/content-collaboration-for-enterprises-with-korals-mark-suster

Guest: Mark Suster - Koral
Host: Robert Scoble - ScobleShow

Robert Scoble - ScobleShow
So, who are you?

Mark Suster - Koral
My name is Mark Suster, I'm the CEO of a company called Koral.

Robert Scoble - ScobleShow
And we are here in the Salesforce.com building, right in San Francisco.

Mark Suster - Koral
That's true we are.

Robert Scoble - ScobleShow
Now, why are we in the Salesforce.com building? If you don't live in Salesforce.com we're just meeting here.

Mark Suster - Koral
That's true, I was in San Francisco and they are such good friends, they offered up their offices as a place to meet.

Robert Scoble - ScobleShow
Yeah, and what does Koral do?

Mark Suster - Koral
So, Koral is a content collaboration company, what does that mean? That means if you look at Enterprise Content Management as a sector, it's a $3 billion sector, but only 5% of business users use any Content Management System at all, right. We all use email and that's the problem, that's the nut we're trying to crack is...

Robert Scoble - ScobleShow
And that's horrible because like -- when I left NEC, when I left Microsoft, I left more than a gig of email at both places, and that email -- I don't have access to it, because I'm not allowed to look at it and I didn't save it and nobody at Microsoft or nobody at NEC has it, and so all that knowledge that I squirreled away like a squirrel hunting little acorns and stuffing them in my email box.

Mark Suster - Koral
Oh, you hit a nail in the head, everyone's knowledge lives in email or in their desktop and doesn't get put back in the repository. So, companies, let's say, product marketing creates materials and they put them out to sales people, but then the sales people end up using whatever their sales engineers tell them anyways, right. So, what we're trying to do is create a kind of feedback system where you can create communities between different departments to share content.

Robert Scoble - ScobleShow
So, isn't that just a blog?

Mark Suster - Koral
It's a different type of information, we're dealing with information that exists in document formats today, so it might be Excel, PowerPoint, Word, traditional document formats PDF. But we're also doing things like you can put in links in to sites, we'll go crawl them, index all the information and make it searchable. So, the problem is this, is it's not easier to get format to host documents, but documents get out of sync. So, a President of a company might go out and find that everyone of his sales reps has a different pitch and so how do you control them?

Robert Scoble - ScobleShow
Now, right before the camera came on, we were talking about your past life.

Mark Suster - Koral
That's true, yeah.

Robert Scoble - ScobleShow
Which is sort of still your present life because you're on the Board of Directors?

Mark Suster - Koral
That's true.

Robert Scoble - ScobleShow
Tell me about going to the dot com and what you did before?

Mark Suster - Koral
Yeah, so I created a company called BuildOnline, it was also a content collaboration company but targeting specifically engineering and construction. So, yeah, we started up in early 2000 when money was less and people were financing companies, we did a very -- our very first round of finance was $16.5 million and we didn't even have a product then. Those were very different days.

Robert Scoble - ScobleShow
Excellent! How do you direct that kind of business?

Mark Suster - Koral
Yeah, exactly.

Robert Scoble - ScobleShow
Actually, how do you go in and fit somebody when you don't have a product?

Mark Suster - Koral
Well, I had great spreadsheet so look at the end of the day...

Robert Scoble - ScobleShow
I want to keep those spreadsheets.

Mark Suster - Koral
We had a good idea...

Robert Scoble - ScobleShow
I want to know that formula that you typed in the Excel, build me a great spreadsheet to go in and sell a company without having a product.

Mark Suster - Koral
Exactly, so those were different days as you know I mean that the stories I could tell but...

Robert Scoble - ScobleShow
Oh, please do.

Mark Suster - Koral
What we do, we had investors who were so interested in doing the deal that they had race car drivers, in fact, Eddie Jordan was calling us, he is a famous race car driver from Ireland and he was promising us that if we took this investor's money which we actually didn't that he would promote us, that we would promote BuildOnline and he was saying, think about all the girls that come to race driving and all that stuff and we had 20 stories like that, it was funny how money was chasing you back then. The times changed, I then raised money again in 2001 when we were at trough for the market.

Robert Scoble - ScobleShow
Now, how did you get funded in 2001? I think you're the only guy alive that got funded in 2001.

Mark Suster - Koral
April 2001 was tough and even tougher in Europe because no one was funding tech companies at all. I think that, the thing what was different is we built around software and a lot of companies in Europe hadn't built software. So, we built software, we had customers who were piloting and pretty big ones like the London Underground and National Grid and bunch of big UK companies and our investors said, yeah, this is actually changing the way these companies work. Six years later they're still using our software which is great.

Robert Scoble - ScobleShow
So, what happened to that company?

Mark Suster - Koral
So, build a line.

Robert Scoble - ScobleShow
Did the investors get their money back?

Mark Suster - Koral
The investors will get their money back, they're still shareholders of that company. They merged with a US player and it's now a global operation, it's operating in nine different countries, we have projects in 19 different countries, seven different languages. Yeah, it's become a global business, we have operations in India, China, US, Central Europe everything.

Robert Scoble - ScobleShow
Since this video will probably be watched at the next Bubble Burst, when it happens, I'm sure it will, when people get overly excited, they go the other way too and become too desponded. That the world is ending right now, they can stop funding things. So, for the next guys how would you pitch your company in the downtimes when all the investors are holding on to their wallets and saying, sorry we're not funding right now?

Mark Suster - Koral
But, in a way it's beautiful, like right now the thing that I find most difficult is not raising money, what I find really difficult is hiring great talent because there's so many people out there recruiting and everyone has again three to five opportunities and they can drive up the prices of what you can pay. So, I'm struggling to find great talent at a time where we have a great business opportunity. In a down market, if you have money and a great idea, it's actually an easier time to build a business, I would argue because you can build this slower without the same expectations and think about just even communications, right now how do you get messages out because everybody is trying to communicate, look at the success of Salesforce.com, right. Marc Benioff was out communicating to the world, the importance of, 'The End of Software,' but no one else was talking to the Press, everyone else was cutting back, all their marketing budget. I think that was the success of Salesforce.com, that they stood out in the down market and they actually had something to say.

Robert Scoble - ScobleShow
Yeah, wild! So, anyway, so how did you get into this (Voice Overlap)?

Mark Suster - Koral
Yeah, so the thing that we learned at BuildOnline was...

Robert Scoble - ScobleShow
Because you guys -- the reason I'm interviewing, you were hot thing at the Salesforce.com.

Mark Suster - Koral
Yeah.

Robert Scoble - ScobleShow
What do they call that?

Mark Suster - Koral
Dreamforce

Robert Scoble - ScobleShow
Dreamforce conference, which was a couple of weeks ago.

Mark Suster - Koral
And following on from that Office 2.0 called us probably the most relevant application that was there. So, we've got good accolades. The thing is this, last time we designed a product, we landed a few big customers and we ended up building software for the economic buyers and it got deeper and deeper and deeper in terms of functionality but not in terms of usability. So, we were able to sell multi-million dollar deals. When we started Koral, we said, "We are actually going to do this different, we're going to design a software for the end user." Our view was, if you look at things like Skype, they were so easy to sign yourself up and spread out to five friends, they spread out, and then afterwards a business could come, overlay a security model and get control of it.

But, if you design it just for the economic buyer, by definition you're probably designing something that's not very usable. Why is it that it's easier to use Amazon and Gmail and Skype than it is to use SAP and Oracle and all these companies? So, that's what we did different. In fact, I think that's been our success because the people have been piloting us or actually telling their bosses about us and in a way, it shortens the sales cycle.

Robert Scoble - ScobleShow
You are going in the back door instead of going in the front door, right?

Mark Suster - Koral
That's the best way to go, where people are actually able to use your software, so we've gotten rid of a lot of ideas that we think were outdated. We've gotten rid of Taxonomy, there was no folder structure on what we do, because at the end of the day, in any of these file systems again you'll probably know it from yourself, you set them up with the best intentions but as you drift two or three years, no one can find information anymore, right. So, we've gone with the Folksonomy approach, and in a corporate environment, that's hard for people to accept. It's a new idea, this idea of a democratic system where people can actually tag content, it takes a leap.

Robert Scoble - ScobleShow
Okay, so I can just imagine, I'm an old styled office worker. I have Outlook, Excel, PowerPoint, Word and probably if I'm a sales guy -- maybe Salesforce.com but maybe something else. Or if I'm working in, like NEC, I was using what's that other one, SAP.

Mark Suster - Koral
Yeah...

Robert Scoble - ScobleShow
(Inaudible) small company.

Mark Suster - Koral
It all happens to be on your bag over there.

Robert Scoble - ScobleShow
Yeah, I was using them to track things going around the corporation right because I was helping sales people get sales done. So, what I'm I going to do with your app, where am I going to fit in Koral?

Mark Suster - Koral
Right, with everything else that you are doing, I mean let me just give you one stat.

Robert Scoble - ScobleShow
Then how much do I have to flip my mindset because all this new stuff, requires you to flip your mind a little bit.

Mark Suster - Koral
Possibly, here's the right side Robert, is that our idea is that we don't want people have to change the way they work and that's actually the opposite of what my last company in 1999 that I started did. What we wanted was, everyone to log on to our system everyday and we wanted to be the place that brought everyone in. I'm not assuming that you don't want to do that, you want to work in email, so, I've got to work the way that you work. So, for example, just some simple examples, you don't actually need the log in or a system to upload documents, you drag it and drop it to a drop box and it auto classifies it. Now, it will come back with a set of suggested tags, so you can hit five buttons and publish.

Robert Scoble - ScobleShow
So, if I drag a Word doc like a -- I don't know a 10,000 page -- or a 10,000-word Whitepaper that I wrote. What does it do when you say it'll auto classify?

Mark Suster - Koral
So, what it'll do is it'll take the file, it'll automatically index all the words inside the file, so it's searchable by anybody. It will automatically upload in the background and then we take the terms from the document and it'll say, based on our algorithms, here's recommended tags for you, so, you don't have to type in your own tags, you can just click on our recommended tags. Then it autopublishes to Workspace so you pre-configure what Workspace you want it to publish it too. If you upload a PowerPoint file, we do one step more as we generate images, Flash images so, when someone searches on PowerPoint, let's say, they type in, I don't know 'British Telecom' and they get back their 12 files. They don't have to download, you can actually view them all online.

Yeah, they're like Amazon books or Google books or something where you can actually see the images of the pages because again it's the idea is, people who search for information in a system, if they don't find what they want like that, they just don't come back. The startup is going to give you a moment ago 44% of people, according to Forester say, they can find what they want on a Corporate Internet, which is thousands of documents right. 78% of people, the same people polled, so they could find whatever they wanted on the Internet, despite billions of records right, why is that because we build these overly complicated file systems that no one can find anything.

Robert Scoble - ScobleShow
Well, also on the External Internet, we have blogs who link to each other and it's the linking behavior that allowed Google to come out with PageRank Algorithm, right.

Mark Suster - Koral
Exactly.

Robert Scoble - ScobleShow
We don't link to things internally. I've worked at Microsoft and NEC, two huge companies. At NEC we had very little Internet...

Mark Suster - Koral
Intranet.

Robert Scoble - ScobleShow
...we need different words because they're two (Voice Overlap) but inside our Corporate Firewall we had knowledge systems and we had very little data there. In fact, I couldn't even publish to my Intranet. At Microsoft, I can publish to my Intranet, we have SharePoint sites, we had Wikis and blogs and all sorts of stuff but it was all other place and you could search it. But the searches weren't rich like they were on the outside world because there wasn't the linking behavior. I couldn't see how many people linked to Bill Gates (Voice Overlap).

Mark Suster - Koral
Wouldn't it be nice if you could search based on what documents or content are popular?

Robert Scoble - ScobleShow
Yes.

Mark Suster - Koral
Wouldn't it be nice if you could search against tags and authors and then number of other attributes rather than just the titles?

Robert Scoble - ScobleShow
So, how are you guys tracking popularity inside companies?

Mark Suster - Koral
So, popularity is based on an algorithm but we can do things for example, we have rating systems, so you can rate content. You've got subscriptions of publishing Subscribe Model and we can make documents popular based on who subscribed to, and who hasn't, how many times it has been downloaded. So, we've got an algorithm.

Robert Scoble - ScobleShow
Do you have Tag Cloud too?

Mark Suster - Koral
We do, we have the Tag Cloud. So, actually again you're an obvious user. You don't have to think about information. Up pops your Tag Cloud and by the way, it's individualized to you. So, it's not a company Tag Cloud, it's what information do you have access to, that has tags, right.

Robert Scoble - ScobleShow
Interesting.

Mark Suster - Koral
It makes it easier to find information. We take a one-step further actually is, you don't even need to login in the system. We put little trackers inside every document. So, if someone sends you something by email that was already once in the golden repository and you open it on your desktop, we can actually tell you, if there is a more current file on the system, even if you don't login.

Robert Scoble - ScobleShow
That's awesome.

Mark Suster - Koral
It's cool.

Robert Scoble - ScobleShow
If I remember, the demo you showed me, I can open a Word doc on my desktop that I dragged out of...

Mark Suster - Koral
File comparison.

Robert Scoble - ScobleShow
...and it automatically says, hey if somebody is uploaded a new version of that.

Mark Suster - Koral
That's exactly in

Robert Scoble - ScobleShow
I got to get a demo of that because there is the coolest thing I've ever seen for a corporate guy.

Mark Suster - Koral
I'll give you another example is, if you -- like at my last company, I remember, one of my largest clients would take 50 files out of the system and they would do nothing more than change the status from in process to completed. Then, someone would upload it to a different folder, the same 50 files to a different folder. So, then when someone else comes in and tries to find information you've got the exact same file twice and how do they know which ones, unless you open the file and actually look at the header block you don't know which one is current. Because of the Document Tracker, when you go to upload it again, it'll stop you and it'll say, you know what, this document already exists. Are you looking to version it or are you really trying to break the link and create a new file. See, what we're trying to do is the invisible bit behind the scenes. So, I'm not trying to get into my system everyday, I'm trying to solve a problem.

Robert Scoble - ScobleShow
Does my IT department have to come over to my machine and load something on it for it to work?

Mark Suster - Koral
They don't, so we do need something on your machine, we can't do -- it's not complete David Copperfield. But we have a little piece of software that we download using WebStart. The beautiful thing about is -- you click a single button and it installs itself and anytime we update the software or it can autoinstall if your department chooses to ideally do that. So, we subscribed to the ethos of zero-footprint and the software is completely usable with nothing on your desktop.

Robert Scoble - ScobleShow
Does this work only on Windows or Mac in Windows or...?

Mark Suster - Koral
Today, it's Windows and we'll release for Mac next quarter.

Robert Scoble - ScobleShow
Oh, okay. Linux and all or just Mac?

Mark Suster - Koral
We'll do Mac first and we'll do Unix after -- Linux probably after that. So, right now, it's working on Windows environment which in our install bases is the majority and I guess you have to get the majority right first.

Robert Scoble - ScobleShow
Ninety plus percent.

Mark Suster - Koral
Yeah, but the very important influential niche is now all on Macs and you've got to service those clients.

Robert Scoble - ScobleShow
Yeah but inside corporations.

Mark Suster - Koral
A part of work...

Robert Scoble - ScobleShow
Well, at Microsoft I was seeing more Macs but even then.

Mark Suster - Koral
The senior execs, you're seeing more Macs.

Robert Scoble - ScobleShow
Yeah.

Mark Suster - Koral
But the product works fully...

Robert Scoble - ScobleShow
How come the execs always want the pretty machines?

Mark Suster - Koral
(Voice Overlap) They end up with -- maybe personal use at first and then they've got the whole IT department of the company servicing their personal needs because the company couldn't roll out Macs to everybody and then support both Windows and Macs.

Robert Scoble - ScobleShow
Can I drag, one of the other things we started talking about was email, I ended up with a gig in something of email from both Microsoft and NEC and a lot of the email that I got -- a lot of it I threw away, just "Hey Robert, I want to go launch and throw that away," right But, that doesn't have any value. But, a lot of the email I got was what I called resources. Hey, there's a new Windows Vista Server that I just opened up, here's the server name, here's the password da... da... da... and that would be...

Mark Suster - Koral
Wouldn't that be nice to be able to find that later?

Robert Scoble - ScobleShow
Well, that and also share it with my workgroup because they probably would send to me because I run my workgroup and the two leave it around, so if I get hit by a bus, God forbid...

Mark Suster - Koral
Yeah, you've got corporate knowledge.

Robert Scoble - ScobleShow
Well my replacement can come in and go, oh man, look at all those resources that you save for me.

Mark Suster - Koral
Completely. So, the way -- so first quarter next year also we will have an email in and out capability and we built it at the last company, so we know how to do it, it's just a matter of designing in a way that we think further is it from the last iteration, but the way the work is you'll be able to email something in and let's say, it has five attachments. Each one of those again will be autoindexed, autopublished, images generate, so that other people can actually see those and then we'll take the text of your email and we'll break that off separately and we're going to create that as a private file that's not published. So, you'll have access to all your email in a private area, then if you want to publish that you can, but our assumption is you want to keep your email message private.

Robert Scoble - ScobleShow
Actually, these resource messages, I have a folder in my email called 'Resources,' but I don't today share with anybody, but could be shared very -- I could even split it up private resources and public resources and I certainly would love to share that with my workgroup or my co-workers, or my employees because that way they could see the stuff that's coming along and it's really powerful. Now, how did you guys stick in that tracker, so that you can track all this stuff?

Mark Suster - Koral
Well, that's part of the secret is so awesome and that's actually what we...

Robert Scoble - ScobleShow
Oh, give up the secrets.

Mark Suster - Koral
We are filing patents on that. That's really what we think is, how I mean, I think one of the failures of most content management systems is they expect everyone to login into the system and will live in the system -- people don't want to use content management, I don't. So, how do you create it, so that people can actually use it, distribute it. Another example, I was going to give is email out, so you can go these eight documents I want to share with my customer or these four I want to share with my channel partner and the way it works is, you create a package, and we're calling it a playlist, but maybe if Apple might not like us using that term, but you create a Playlist so it's not...

Robert Scoble - ScobleShow
Apple doesn't like anybody.

Mark Suster - Koral
Yeah, it's not just documents, but it's the sequence of documents. So, it could be like a new joiner induction program and here's the eight documents you need to read in this order. But, then I can share that externally with people and the way we do it is we share a link. So we'll send a link out to people, they click a button and then the files automatically download. But the important thing there is, it gets around the Firewall problem because most Corporate Firewalls will cut you off if you send typical files. Number #2 is, it creates an auto trail. So, actually no people received there or not whereas you send it on an email, you often don't know.

Robert Scoble - ScobleShow
So, your tracker, well your tracker?

Mark Suster - Koral
Well, this isn't the tracker, this is the link, right.

Robert Scoble - ScobleShow
Okay.

Mark Suster - Koral
Then the third thing is, you send it out and if you send it out and you didn't mean to send it out, you can actually cut it off, that old email thing where it says, "Recall your message..."

Robert Scoble - ScobleShow
Yes.

Mark Suster - Koral
...and it doesn't work.

Robert Scoble - ScobleShow
No, it don't.

Mark Suster - Koral
But, what it does is generates a message saying they tried to recall it so are you doing it telling people, "Hey, that last email was really interesting, go read it."

Robert Scoble - ScobleShow
Yeah, and that's what he told me.

Mark Suster - Koral
Yeah, exactly. So, here's a way that you can actually recall that from happening, you can send very large files, you can send 20 and 50 meg files, can send those today. So, we did that at the last company because we're dealing with CAD files, lot of our files were 50-60-70 meg.

Robert Scoble - ScobleShow
Wow, are you ever going to take this to the public and Internet instead of keeping it behind closed Corporate Firewall doors?

Mark Suster - Koral
Well, it's not behind Corporate Firewalls.

Robert Scoble - ScobleShow
I know about your knowledge because I'd like to have those same knowledge management features, but on my desktop at home right, where I could share them with the world, and if I say your Word doc over the Internet, I'd love it to be able to say, 'Hey Scoble, that's _a new version of that Word doc.

Mark Suster - Koral
You can do it, you can do it today.

Robert Scoble - ScobleShow
How?

Mark Suster - Koral
On our system. Our system is not behind firewalls, it's an on-demand platform, it's a multi-tenant database, it's a single instance you don't install it and so it's already there and it's free, right. For basic usage...

Robert Scoble - ScobleShow
For me on my Mac or well...

Mark Suster - Koral
On your Mac you can use it, you just can't use the Desktop Component until next quarter.

Robert Scoble - ScobleShow
Okay, so, on my Windows machine because I have a Table PC, I can use it for free?

Mark Suster - Koral
Yeah.

Robert Scoble - ScobleShow
I don't have to join anything.

Mark Suster - Koral
No.

Robert Scoble - ScobleShow
What do I have to do?

Mark Suster - Koral
You have to go to our Website, koral.com and sign-up, that's it.

Robert Scoble - ScobleShow
All right. So, how are you going to make money with that?

Mark Suster - Koral
So, we have a free model and the free model is mostly designed for small to mid-size usage, let's say upto 20-30 users. Now, we actually don't place limits, so if you want to use it for 100, you can use it knocking your socks off. Where we want to make money is from business users who are willing to spend money for something that provides value. So, the things that you want to control -- I've talked a little bit about Web 2.0 concepts; publishing, subscribe, tag clouds, things like that, the kind of ability to search for things easier. But on the other side it's Corporate Control, they might like to lockdown Widgets. We've widgets like Pageflakes or Net Vibes. But, a corporate might want to lock those down. A corporate might say, you can rate documents in our general area, but not our HR policies. We don't want feedback on our HR policies, so we don't want ratings anyway. So, if you want to get into...

Robert Scoble - ScobleShow
HR people are always evil.

Mark Suster - Koral
I didn't say that. If you want to get into lockdown issues, or if you want things like workflow that a business would want. So, the kind of things that you want under control end of the sphere, which are really more larger business-oriented things, it's a paid model for general usage, right.

Robert Scoble - ScobleShow
Okay, how much does your sale proceed?

Mark Suster - Koral
Yeah, entry level is $15 a user a month, maximum is $45 a user a month.

Robert Scoble - ScobleShow
What do I get for 45 bucks versus 50?

Mark Suster - Koral
So, the segmentation is just a feature set. So, 45 you're getting all the corporate stuff like workflow and all that stuff and the $15 version is just a little bit more limited in terms of what you can do, but it's still pretty functional.

Robert Scoble - ScobleShow
So, I could use it for free right now at PodTech and get Irina and Eddie on it?

Mark Suster - Koral
Absolutely, in fact, we're trying to promote in small businesses for them to just sign up and start using it for free.

Robert Scoble - ScobleShow
Wow!

Mark Suster - Koral
So, there are a lot of used cases for us, where we think people get value. PR firms where there's 15-20-40 people and they need to share information with all their clients. Why not just start using it?

Robert Scoble - ScobleShow
It's awesome.

Mark Suster - Koral
Because our view is if they're using it with the Intel's and the Microsoft's and the Adobe's of the world, there's a real opportunity for people who can afford this service at $45 a user a month.

Robert Scoble - ScobleShow
Yeah, that's true. What else do I need to know, I don't know. You stumped me there. The free stuff is cool. Let's get a demo.

Mark Suster - Koral
Okay, good. Let's get it started.

Robert Scoble - ScobleShow
Cool, thank you.