Start Up Flops: No Search Vendor Examples
January 21, 2014
I read a quite interesting article, “51 Startup Failure Post-Mortems.” The links in the story point to source documents. The article presents a summary of the principal take away from a crash-and-burn experience.
The lessons are fascinating and include:
- Spreadsheet fever; that is, making assumptions about how many customers a start up will capture and how much each customer will pay
- Users don’t want what the company is selling
- Misallocating time; that is, buying stuff, not selling stuff
- Management errors; that is, hiring, spending, marketing.
I recommend this article. I want to point out that none of the examples came from the deep pool of search-and-content processing failures. Outfits involved in information retrieval face some hurdles that put some spin on the problems outlined in 51 Startup Failure Post-Mortems.
Let me highlight three:
First, search is assumed to be over with Google the winner. Furthermore, most individuals assume that their search skills are quite good, even excellent. As a result, a new information retrieval vendor has to find a way to capture the potential customers’ interest. Indifference combined with a perception that the potential customer has good enough tools produces unconscious resistance to a new search system. Search is ubiquitous and works reasonably well for finding a phone number, a pizza joint, or news about a celebrity.
Second, search and content processing has a cash appetite that has continued to surprise innovators, entrepreneurs, and acquirers. As digital information becomes more plentiful, more resources are required to process the information. Search is expensive and over time only gets more costly. Even the “winner” Google is taking steps to control its Web search costs. Money is a problem for search vendors from Day One and continues to be a problem for the lifetime of the search vendor. Exponential information growth requires exponential investment in resources.
Third, search does not work. Sure, on the surface, a quick look at Bing, Google, or Yandex provides results that answer most users’ questions. However, when one tries to dig into a subject, search in its present form is often unwieldy if not broken. For example, research a topic through time and one finds that content is no longer available. Commercial databases are fraught with gaps. Free services skip content due to latency problems or a desire to process certain low hanging fruit. In short, finding information today is getting more difficult by the day. Online content is not comprehensive, but users assume search systems have “everything.” Wrong.
These three characteristics contribute to the quiet and often noisy failures of search and content processing systems. Search is so disappointing that marketers find it easy to over promise and the systems then under deliver. Some of the lessons about actual companies that have failed in the search sector appear in the Xenky profiles.
Perhaps the next version of “51 Startup Failure Post-Mortems” will tap into the search and content processing sector.
Stephen E Arnold, January 21, 2014
Enterprise Content Management Tips
January 20, 2014
The release of SharePoint 2013 was the top headline in enterprise content management in 2013. But the release of a new product often creates more questions than it answers. For this reason, Search Content Management wrote the article, “The Top Enterprise Content Management System Tips of 2013.”
The article begins:
“It’s no surprise that some of the top ECM tips this year concern how to script in SharePoint 2013, new features in SharePoint 2013 and whether to migrate to on-premises SharePoint or whether to consider SharePoint Online. Check out SearchContentManagement’s top learning content on enterprise content management for 2013 below.”
Stephen E. Arnold, a longtime leader in enterprise search, is also the mastermind behind ArnoldIT.com. Topics like the new features of SharePoint 2013 and SharePoint on-premise versus SharePoint Online are issues he has also addressed this year. The verdict seems to be that while SharePoint is certainly the most dominant ECM system, it is also in need of the most customization to produce a product that aids productivity and increase efficiency.
Emily Rae Aldridge, January 20, 2014
Sponsored by ArnoldIT.com, developer of Augmentext
Xooglers and Management Expertise
January 16, 2014
Two items warranted posting on my white board.
The first was the somewhat ungainly local news service Patch. I noted this version of the action: “AOL Gives Up Control of Money-Losing Patch as Shares Rise.” Patch was invented by Tim Armstrong. AOL then bought Patch and hired Mr. Armstrong, a Xoogler. Or, maybe it was hired Mr. Armstrong and then bought Patch? Either way, the trajectory of Patch made clear that getting hired at Google and then becoming a real manager at a powerhouse like AOL were not congruent. Patch, according to Bloomberg, was “a pet project.” I assume it was like one of the old-school 20 percent free time projects except this one had an appetite for cash and served as a trigger for quite a bit of corporate explaining.
The second was the item I saw regarding another Xoogler’s management acumen: “He Was Fired: Here’s Marissa Mayer’s de Castro Buh-Bye Memo to Yahoo Staff.” Make that two Xooglers: the boss Xoogler at Yahoo Marissa Mayer and the number two at Yahoo, Henrique De Castro. I noted this passage:
During my own reflection, I made the difficult decision that our COO, Henrique de Castro, should leave the company. I appreciate Henrique’s contributions and wish him the best in his future endeavors.
Mr. de Castro will need a pick up truck to haul off his severance pay which is in the millions of dollars. Not bad for less than two years work.
The point is that some folks see getting hired by Google, flourishing in the Google greenhouse, and getting high praise from Googlers as the equivalent of management and operational expertise in the “real” world.
These two articles contain information that folks are mistaking Google employees with Google’s success. I would point to online advertising based on approaches developed by outfits like Overture as slightly more important.
My hunch is that AOL and Yahoo will generate further evidence about the management insights of Xooglers. Why are these Xooglers former Googlers anyway? Too bad I don’t have the energy to dig into the human resources angle. There are many azure chip consultants who can explain the why’s and wherefore’s.
Stephen E Arnold, January 16, 2014
SharePoint and Enterprise Content Management
December 25, 2013
SharePoint may be the flagship ECM (enterprise content management) system, but that does not mean that it is perfect. In addition, such a huge system means that users constantly have to keep up with the latest news and updates. Read more in the CloudTweaks article, “7 Essential Facts About SharePoint And ECM.”
The article begins:
“Pioneer enterprise content management systems like SharePoint can help in take up your business to the next level, but only if you use them correctly. Here are seven things you need to know about this leading web application platform featuring the Office suite, collaborative workforce software and more.”
A couple of common themes that run through this article are: 1) security is key and 2) complexity continues. Stephen E. Arnold of ArnoldIT.com is a longtime leader in search. He often covers SharePoint news and finds many of the same conclusions. While SharePoint is widely adopted, there are noted weaknesses, and users are always looking for the latest tips and tricks.
Emily Rae Aldridge, December 25, 2013
Sponsored by ArnoldIT.com, developer of Augmentext
Out of Healthcare and Into Information Management
December 19, 2013
MarkeLogic has been working on the Healthcare.gov project (not going to touch that hotbed of live wires) and according to Database Trends and Applications the company has a new deal: “Applied Relevance Introduces Information Management Application Optimized For MarkLogic 7.” Applied Relevance developed Epinomy version 7 that is specially geared towards MarkLogic 7. CEO and founder of Applied Relevance George Everitt stated that Epinomy offers an advantage due to its tables, texts, and triples. This makes Epinomy prime for big data management, because of its approach to linking and tagging information, i.e. the tables and texts and then leveraging them with triple store technology for a high-speed experience.
“ ‘The table is the structured information, and it is the traditional BI kind” of information. Text is the traditional enterprise text kind of information. MarkLogic does both of those exceptionally well,’ said Everitt. ‘The third is triples – the metadata – the glue that holds those two together. What we provide with Epinomy is a way of creating and managing taxonomies, ontologies, and other data structures that are represented in linked data so that you can apply those to both the structured and unstructured environments, and get value from both of them using the triples as an underlying semantic mechanism.’ “
Information managers are given more control over their data by allowing them to build ontologies from scratch. Metadata and auto tagging will keep the data organized with quick retrieval and accurate search.
MarkLogic is mostly known in the publishing industry, which is riddled with unstructured data. The company has been gaining attention in financial services. Epinomy will give MarkLogic the boost it needs to prove that it can handle numbers as well as words.
Whitney Grace, December 19, 2013
Sponsored by ArnoldIT.com, developer of Augmentext
MarkLogic Recognized for Database Management
November 13, 2013
We already knew that MarkLogic is good at search. Now the company is being recognized for its database management chops, we learn from “MarkLogic Featured in the Gartner Magic Quadrant for Operational Database Management Systems” at BWW Geeks World.
The press release tells us:
“MarkLogic has been positioned for its ability to execute and is the only Enterprise NoSQL database vendor featured in the report that integrates search and application services. . . .
MarkLogic is the only schema-agnostic Enterprise NoSQL database that integrates semantics, search and application services with the enterprise features customers require for production applications. This combination helps enterprises make better-informed decisions and create robust, scalable applications to drive revenue, streamline operations, manage risk and make the world safer. MarkLogic features ACID transactions, horizontal scaling, real-time indexing, high availability, disaster recovery, and government-grade security.”
CEO Gary Bloom does not let us forget his company’s search success. He points out that they also captured a place on Gartner‘s 2013 Magic Quadrant for Enterprise Search roster, and that they are the only company to be included in both reports. He understandably takes this achievement as evidence that MarkLogic is on the right track with its integrated approach. The company focuses on scalability, enterprise-readiness, and leveraging the latest technology. Founded in 2001, MarkLogic is headquartered in Silicon Valley and maintains offices around the world.
Cynthia Murrell, November 13, 2013
Sponsored by ArnoldIT.com, developer of Augmentext
Forrester Wave Available For Public Reading
October 23, 2013
In the world of business process software, it can be tricky deciding which one to deploy at your organization. That is when one resorts to research and relying on opinions and experiences of others to help them make a choice. Forrester is always a great resource to turn to for business matters and in March 2013, they released “The Forester Wave: BPM Suites, Q1 2013,” detailing the top ten business process management vendors. Bitpipe archives the report.
Ten vendors were reviewed: Appian, Bizagi, Cordys, HandySoft, IBM, OpenText, Oracle, Pegasystems, Software AG, and Tibco Software. Each software has their positives and negatives, what is really interesting is if they are compatible with the leading data content managers, such as Kofax:
“All of the vendors in this evaluation can support the three most common use cases for BPM: dynamic case management, human workflow, and straight-through processing. However, this does not mean that all vendors must or can offer exactly the same approach or the same functional depth for each use case.”
They are Kofax compliant, which is wonderful because Kofax owns Kapow Software –the big data integration platform. Big data is one of the primary concerns of organizations and a business management software that does not have the capability to handle said processes is useless in a competitive market.
Whitney Grace, October 23, 2013
Sponsored by ArnoldIT.com, developer of Augmentext
The Flaw in Christensen Management Theory
October 17, 2013
Could the Big Guru in management have made a miscalculation? Clayton Christensen is rightly revered for his contributions to the business field, particularly his theory of disruption. Nobody’s perfect, however; strat?chery tells us “What Clayton Christensen Got Wrong.”
The professor’s blind spot is perfectly illustrated by his thoughts on certain Apple products; he thought there was no way either the iPod or iPhone would be successful. Writer Ben Thompson delves into why Christensen’s theories led him to faulty predictions about Apple. The key point—people are not businesses. The article asserts:
“Christensen’s theory is based on examples drawn from buying decisions made by businesses, not consumers. The reason this matters is that the theory of low-end disruption presumes:
- Buyers are rational
- Every attribute that matters can be documented and measured
- Modular providers can become ‘good enough’ on all the attributes that matter to the buyers
“All three of the assumptions fail in the consumer market, and this, ultimately, is why Christensen’s theory fails as well.”
Elaborating on the second point, Thompson quotes his own words from a 2010 paper. Regarding a feature of the iPod that is difficult to measure, he wrote:
“Apple’s focus on user experience as a differentiator has significant strategic implications as well… namely, it is impossible for a user experience to be too good. Competitors can only hope to match or surpass the original product when it comes to the user experience; the original product will never overshoot (has anyone turned to an ‘inferior’ product because the better one was too enjoyable?)”
Since individual consumers are more likely to care about ease of use than are buyers for a business, this is a good example of purchasers’ different priorities. See the thorough article for more of Thompson’s reasoning and examples.
Cynthia Murrell, October 17, 2013
Sponsored by ArnoldIT.com, developer of Augmentext
Ex Endeca Execs: Giving New Life to Route 128?
October 6, 2013
I read “Cambridge Firm Is Fertile Ground for Entrepreneurs.” The Massachusetts in crowd should be thrilled with the Boston Globe’s story. In addition to a graphic which puts Endeca at the center of a universe of start ups, the story draws an interesting parallel for me:
Like its much bigger predecessors, Digital Equipment Corp. and Lotus Development Corp., two seminal Boston companies acquired by competitors, Endeca is emerging as a fount of new business activity, churning out the next generation of entrepreneurs and helping to expand the region’s technology economy.
The write up then references the influence tendrils of what I assume is “fertile ground” to Xerox, Digital Equipment, and Lotus.
The article included this passage as well:
But the $1 billion paid by Oracle made some Endeca employees wealthy, which certainly made it easier for them to decide to start companies. And more may follow. Venture capitalists report they are in contact with other Endecans who are contemplating leaving Oracle. Oracle declined to comment for this story. And the Diaspora might have been bigger had Endeca been on the West Coast, where the cycle of people leaving companies for start-ups happens much faster than in Massachusetts. One reason is that many large Boston companies have employees sign noncompete agreements, which can limit their ability to spin off a start-up. Noncompete agreements are not enforced in California. Endeca employees signed noncompetes, but so far those who have started companies are not direct competitors. The new businesses range from social media to medical records companies.
Then this quote to note: “We did a good job of training people how to be entrepreneurs,” said Papa, so that they are not all trying to just “build the next Endeca.” Steve Papa was one of the founders of Endeca.
My thoughts turned to other search companies that sold out. Has there been a similar surge of innovation from:
- Autonomy founders
- Exalead founders
- ISYS Search Software founders
- Verity founders
- Vivisimo founders
I don’t recall a similar explosion of innovation from any of these firms nor a glittering write up in a major, “real” newspaper. There are, I believe, some questions which beg to be answered:
- What makes Endeca different?
- Why haven’t other search vendors’ founders gone the start up route?
- What is the survivability of start ups created by founders of iPhrase (acquired by IBM), Inxight (acquired by Business Objects), and other long-ago winners in the buy out game?
I don’t have any answers, and I am personally delighted that there will not be another Endeca coming down the pike. The notion of blending a Yahoo style directory with key word indexing and then layering on eCommerce, publishing, business intelligence, and other functions is a path well worn by Convera, Delphes, Entopia, and some of IBM’s search efforts.
Endeca, based on my notes, was heavy on MBA think and less into Google-style technology. The list of Endeca spawned start ups includes Salsify, Thank Media, and Toast among others. Each has a hefty dose of “management.” Perhaps MBAs are the answer to market traction?
Stephen E Arnold, October 6, 2013
How to Turnaround a Failing Company
September 17, 2013
Jonathan H. Lack has been an associate of ArnoldIT since 1996. His new monograph is Plan to Turn Your Company Around in 90 Days. We recommend this practical and pragmatic guide for managers struggling with shifting economic winds.
Mr. Lack said:
“Every company’s financial and operational situation, culture, and dynamics are different. However, the fundamentals of operating any business and the problems to which many companies are vulnerable are not that unique. This entire book is based on firsthand experience if helping different types of companies work through very similar problems.”
HighGainBlog said:
This book is written for businesses large and small as well as for CEOs, board members, and managers. Lack’s expertise comes from his role as principal for ROI Ventures, which specializes in turning companies around. He also has 20 years of experience in management and strategic planning. This expertise shines through as he offers sound advice ranging from effectively managing cash-flow to managing staff. We highly recommend this book to drowning professionals looking for a lifeline as well as those interested in injecting new life into their business and gain a few valuable insights along the way.
Plan to Turn Your Company Around in 90 Days is available for purchase online at Amazon.com or at Apress.com under ISBN13: 978-1-4302-4668-8. Order a copy if you are involved in search, content processing, and analytics. This industry sector faces increased cost of sales, long sales cycles, hard-to-control costs, and challenging revenue targets.
Stephen E Arnold, September 17, 2013
-
- Subscribe to Beyond Search
Feature archive
News archive
-
