Competitors Fight for a Slice of the SharePoint Pie

SharePoint and Office 2010 are due in a few weeks, and Microsoft has been gearing up for months for the May 12 launch.

But Microsoft's considerable marketing heft has created opportunities for much smaller vendors who are getting customers to take a look at their products by positioning them against SharePoint. Then if a customer installs the product, he or she may find that it replaces at least some of what SharePoint does.

"It's possible that SharePoint drives business for us," says Aaron Levie, the CEO of Box.net, which just raised $15 million in a Series C round led by Scale Venture Partners, taking its total funding to $29.5 million. Scale managing director Rory O'Driscoll, who has funded several Software As A Service companies, also joined Box.net's board. "We take in refugees from SharePoint - we're able to come in to the market where there's a lot of latent demand."

Levie stresses that when he and Box.net's other founders started the company they didn't set out to kill SharePoint, which can handle complex and powerful workflows for very large companies. They wanted to solve a narrower problem - the need to share and collaborate on all kinds of content regardless of where you're located, whether inside or outside a company's walls.

Still, the size of businesses that use Box.net's software is growing - the Oprah Winfrey Network, Volvo and Nokia Siemens Networks have signed on. It's been SAS 70-certified, and it integrates with several other online products, including Salesforce.com and Google Apps (another vendor whose software gets compared to SharePoint). Box.net has started calling itself a "Cloud Content Management provider" and is hosting a conference next month at HP's headquarters in Palo Alto - Altitude 2010. Levie says he hopes to work with Microsoft to integrate Box.net with Office 2010, which is supposed to be Web-enabled.

MindTouch, meanwhile, claims hundreds of thousands of installations and is about to release MindTouch 2010, which is open source. The company was founded by former Microsoft employees who once worked with Craig Mundie, now Microsoft's chief research officer, on "how to make complex enterprise systems snap together like Legos instead of in a bloody, painful process," according to MindTouch founder and CEO Aaron Fulkerson. MindTouch's other founder, Steve Bjorg, developed the search engine that SharePoint now uses.

MindTouch has both a free version of its software and a more robust version that the company sells. Most paying customers - around 70% -- use MindTouch for product or process documentation, which SharePoint isn't well suited for, Fulkerson said.

Still, once it's inside a company, MindTouch may get used in other ways as well -- to build dashboards that connect enterprise systems and databases, for lightweight business intelligence, for workflows that automatically manage content. The company is funded by angel investors and the founders and has been growing about 20% to 25% per quarter.

Continuing Problem: Data Silos

"Steve and I kept seeing the same problems in organizations -- the proliferation of applications and data silos," Fulkerson said. "There used to be one person (in a company) who created content and disseminated it, but that's not the case anymore and it's a huge pain, especially to the enterprise. We've moved from a one-to-many to a many-to-many workplace."

Microsoft also uses a Trojan horse strategy with SharePoint -- there's a free version bundled with Office, and customers pay extra if they want the powerful version.

But both Levie and Fulkerson argue their software is less complicated and easier to use than SharePoint, because projects can be finished in days or weeks instead of months.

The biggest competitor of all to SharePoint, according to Levie, is still e-mail, which employees will use to get around content sharing software if they can't figure out how to use it.