Tapping the SaaS Potential

Robert Carr has made a business of anticipating trends in mainstream computing and development. As chief scientist at Ashton-Tate Corp. in the mid-1980s, Carr developed the groundbreaking Framework, an integrated-productivity application that helped pave the way for Microsoft Office. In 1987 Carr founded Go Corp. and led development of the PenPoint operating system, the first major effort to establish general-purpose Tablet PCs.

Since then, Carr has served as vice president at AutoCAD, managing director of a venture capital firm, and, most recently, is CEO of Keep and Share, which produces a Web-based group productivity application.

Tell us about your new company.
Part of our vision is to use the Internet to bring people together. What we're really doing is trying to take concepts and functionality that have been around for quite a while in very powerful business-oriented groupware products like Lotus Notes or Ray Ozzie's Groove and recast it in a very simple user interface -- and also really downsizing the functionality dramatically, doing only 20 percent of what those big products do, but pick the right 20 percent that hits the sweet spot of what consumers and very small groups of individuals need.

Where did the idea come from?
It evolved, like many of the best ideas. It was going to be an online private prayer request list where people who like to get together and pray together could list their request and list updates and have it all be password-protected so they could communicate with each other offline when they weren't meeting. [Richard Carr, my brother], implemented it, and he then started working with me. He started generalizing the product and turning it into a horizontal platform.

Today, we have a horizontal integrated suite of software that applies these group-sharing concepts across word processing, calendaring, file sharing, to-do lists, discussion boards, online bookmarks and, above all else, the notion of easily defining a group and then sharing and communicating with that group using any kind of information you like.

Robert Carr, CEO, Keep and Share "With Software as a Service, you get direct feedback, you've got this recurring-revenue business model opportunity. You have very low cost of selling, and everything is measurable."
Robert Carr, CEO, Keep and Share

How was the technology developed? What kinds of software tools were used?
We have a very strong belief that, especially when you have small teams involved, it's great to pick a platform that's simple and cheap and fast. We selected LAMP, the Linux operating system with the Apache Web Server, with MySQL database on top of that then the PHP programming language. It's all open source. We've been really happy with the selection.

Are your contractors using Keep and Share to collaborate?
Yes. One of the things it does very well is secure private file sharing with an easy-to-use front-end so you can use any of a variety of tools out there, so you can mix word processing-style documents along with binary files. Whenever we have developers work on something I create a secure folder for that developer and me, and I put the specifications up in that folder, then we agree on naming conventions, then they upload their deliverables into that folder.

How could a corporate software developer take advantage of your technology?
Our natural target market is for groups of people for whom they have no IT manager. If they have IT staff, the IT staff can set up Web-based or server-based collaboration solutions for them. On one level I'd say we're not for corporate developers, because by definition they have IT staff available to them. But I've realized that most developers in most corporations ... their attitude about their IT staff is that it's unresponsive, probably because they're swamped. If a corporate developer doesn't have a good solution available from IT for peer-to-peer collaboration, then Keep and Share would be great.

What's your sense of Microsoft as a dev tools vendor after 30 years of serving this market?
The rhetoric I heard from the top officers at Microsoft in the late '80s about how they couldn't believe how large and slow-moving and inefficient IBM was when it came to software. Life is full of ironies. We all travel to places we never intended to travel to, and in general, my impression of Microsoft, its software these days, is the company is large and slow-moving and inefficient.

Do you see Redmond doing enough to interoperate with open source?
At a high level just knowing how wedded it is to its monopoly position in the OS and the application suite, and that that's a fat and thick client software model that's proprietary software, I have to think that Microsoft is going to be dragged kicking and screaming for the next 10 years in the direction of working with open source.

Is Microsoft sending out mixed signals, pushing fat clients such as Windows Vista and Office 2007 while at the same time talking SaaS and Web services, such as Live?
I have five words of wisdom that apply here: Actions speak louder than words. Look at what it's shipping and look where the company made its money. Don't look at what Microsoft's talking about. Google talks about software as a service [or SaaS]. But I don't see it shipping any thick clients. Google's shipping software as a service. If you want to know where Google is and where it's headed, just look at its actions.

What trends will fundamentally change the world of software in the next several years and why?
It's this software as service. I've spent my whole career until about five or six years ago in the old model of you build a piece of software and then you ship it to your users, and you're separated by this gulf. It's only with very costly techniques like focus groups that you can actually talk directly to them and hear back from them. So with SaaS, you get direct feedback, you've got this recurring-revenue business model opportunity. You have very low cost of selling, and everything is measurable.

Anybody building software needs to realize that you're not just building software, you're building a set of business processes around their software to successfully deliver it to the customers and ensure their customers are getting their highest possible value. When you have Web-based software delivery, you have a chance to build closed-loop systems for all of your business processes, as to how you deliver your software and how you measure the feedback from your users. You can automate almost all of that. Then all of a sudden you're able to optimize -- not only the code in your software -- but you're also able to work at the meta level and optimize what functionality you offer to the users and what language you use to describe that functionality.

What's your sense of Ray Ozzie's impact on Microsoft?
Good start! I'm not surprised by the energy and articulate leadership he instantly provided there. I am pleasantly surprised that he seems to be getting strong support from the top powers that be and from the culture there. It's a good start.

But Microsoft is a very big ship to steer. IBM in the late '80s was still fat and happy with their mainframe monopoly, and it hadn't yet reached a crisis state. It was only when the company reached a crisis state that it both brought in an outsider, in this case its new president, Lou Gerstner. He transformed that company in a mere five to seven years.

So, the question for Microsoft and Ray Ozzie is, has that company yet reached its crisis point where it's truly open to change? Is Ray Ozzie really the change agent? From my judgment, it may have to go another five years before it's truly in crisis and the real change agent will be someone who comes in from outside as a new president.

Is there a really cool company that you invested in that you can tell us a little bit about?
The company is called Laszlo Systems. It's a leader in providing technology platforms for AJAX and Web 2.0. I invested in the company probably in 2000 or 2001, and it has some really serious technology that, if you use its approach, you can have a much slicker user interface running in the browser than you can in your thick client software on an operating system.

How does a developer, entrepreneur or investor try to figure out the next big thing?
The timeless answer for me has been to, at the end of the day, try to find the intersection between something I deeply feel a personal need for and what I think millions of other people must also want.

What did you learn about Microsoft, good or bad, from your experience with Go Corp.?
In that case it was mostly bad. We learned the lesson to be very careful when you deal with Microsoft. The company has a reputation of copying other people's ideas. I think as the story played out we probably experienced Microsoft at its worst. I know it has decided to change since then, and I know it has changed to some degree. I don't want to rehash history too much, but some years ago the company had numerous anti-trust lawsuits against it in which many states alleged consumers were harmed by Microsoft violating anti-trust laws. What Microsoft did to Go was a top exhibit and a top example in many cases and Microsoft settled all those cases. It didn't defeat it. So, whenever you're dealing with any large company, just be careful.

Did pen computing suffer because Go didn't survive?
Yeah, absolutely. I think a lot of the best ideas and inventions have been lost. Microsoft has started trying to put some new efforts into pen computing the last few years, which I think is great. If I could speak to that team, I'd say, 'Hey, guys, you know, there were books published both by your Microsoft pen Windows team and by the Go folks that really documented our designs. Go back and study all that and steal all the good ideas you can get because the world needs them.'

Any advice to young programmers?
Mix it up. Make sure that in your first five years you get a combination of experiences. Don't only be the wild, solo inventor and don't only work in a large environment. I think you learn the most if you work in two or three different environments. Make sure you work closely with some really senior, really good people because you learn a ton from them. My first job was at Xerox PARC, where I was a junior programmer in this pond filled with very big fish. I was the little fish, and it was very humbling, but I learned a huge amount in just my year there.

What do you think of Microsoft's efforts in the development space over the last few years? Is the company on the right track?
It's doing well. Historically, that's been a strength of Microsoft. It's been smart enough to always use all of its own dev tools, and so the company was always set up to be its own harshest critic. It's kind of this theory of eat your own dog food. Typically, Microsoft has been providing pretty darn good tools, and it's been smart enough to invest a lot of effort into that area and realized it was strategically vital as well, as it could make good money off [those tools].

What kind of advice would you offer Microsoft?
Microsoft has had for 30 years the overriding rule that all of its different efforts interlock with each other.

So I guess my advice to the Microsoft folks would be to put yourselves in the minds of the thousands of Web startups that are just focused on reaching markets that don't care about Microsoft interoperability. If you want to serve those startups and, perhaps, develop small, cheap, fast platforms that really focus on what those startups are doing, pick the right 10 percent of interoperability that does matter. You can still be part of a large Microsoft family. If it's for consumers, maybe you interoperate with a few of the key Microsoft consumer standards and initiatives, but forget everything else and be willing to start from scratch and build something that's small and efficient as a platform.