Great news for our space. Gartner, Inc. just released the 2008 Magic Quadrant for Social Software. In the latest report, we are positioned in the Visionaries Quadrant. Gartner, Inc.  defines companies in this quadrant as follows:

If you want to read the full report, you can access it here, compliments of Jive.

We believe that Jive's growth and recognition from Gartner proves that there is a transformative power in community-based collaboration and it really is changing the way companies work. Collaboration continues to be a major area of enterprise investment and, in addition to new customers, we've also seen a lot of growth with existing customers as they add more of their employee base onto Jive's Clearspace application.

About the Magic Quadrant:
The Magic Quadrant is  copyrighted October 2008 by Gartner, Inc. and is reused with permission. The  Magic Quadrant is a graphical representation of a marketplace at and for a  specific time period. It depicts Gartner's analysis of how certain vendors  measure against criteria for that marketplace, as defined by Gartner. Gartner  does not endorse any vendor, product or service depicted in the Magic Quadrant,  and does not advise technology users to select only those vendors placed in the  "Leaders" quadrant. The Magic Quadrant is intended solely as a research tool,  and is not meant to be a specific guide to action. Gartner disclaims all  warranties, express or implied, with respect to this research, including any  warranties of merchantability or fitness for a particular  purpose.

When we launched Clearspace 1.0 in February of 2007, it was a response to an overwhelming number of enterprise customers saying the same thing: we're stuck between heavyweight collaboration apps (good for file-based workflows, but no one uses them to collaborate) and lightweight Web 2.0 apps like wikis (good for quick adoption, but incomplete, siloed and don't scale). They said, "bring all of these formerly disparate technologies into one system, make it enterprise class, and make it so highly-intuitive that anyone could use it." We did that. And it was very successful.

So now, a little over a year later, and with hundreds of customers under our belt, we're learning a lot. While Clearspace has been very successful as a lightweight way to collaborate and organize content that was historically never captured, there were some consistent issues as our customers tried to get it deployed inside their organization:

1. How do I drive adoption?

2. How do I know what to focus on?

3. How should we manage projects?

4. How does it work with my Sharepoint content?

5. How do I involve people outside the firewall?

6. How do we keep track of changes?

Enter 2.0

The driving force behind the 2.0 release was to take some of these issues head on. A good way to frame the new features (and existing / future features for that matter) is into the big categories of people, focus and work. Here's what we're launching:

People: Expanded profiles and organizational relationships. Find the right people based on the right information, and see exactly where they sit in the organization (full org chart functionality). Plus you can highlight a name and get a mini-profile.

Focus: Personalizable homepage. It's like iGoogle for your work life -- a completely widgitized homepage. No more being overwhelmed by all the content -- now you can provide your own filter to what matters most (what my colleagues are doing, what's popular, my projects, etc.).

Work: Projects, sharing and Sharepoint integration.

• Projects: With very few products out there (in between heavyweight project mgmt apps and a spreadsheet), our customers were hungry for the ability to manage projects and coordinate resources at a high level, with features like milestones and tasks.

• Sharing: A new cloud-based document sharing service allows you to collaborate with people outside the firewall, even if your software is installed on premise. Your guest user just logs into the service and and can start adding content to your local instance.

• Sharepoint Integration: Integration with Sharepoint 2007 allows you to search, browse and link to Sharepoint content from within Clearspace.

There's also a lot of new features under the hood like recording an audit log of actions performed in the admin console, the switch to the Spring and Struts 2, and improvements to the rich text editor. You can learn more in the new Clearspace section of our site.

I've been using the release for a while now, and I'm a huge fan (projects and the widgetized homepage have made the biggest difference in my life). Please download (or test drive online), play around and let us know your thoughts.

New Website

You might also have noticed the new website. Sam, David Greenberg, and team have been hard at work on building a beauty of a site that matches the depth of the new Clearspace release. These guys have done an amazing job and they've been sleeping at the office to get it done. My hats off to them. We would love your feedback on this too, so let us know what you think:

  We put out a press release today about some of the great things that happened in 2007 and how we've taken on a leadership position in this rapidly evolving space. While I'm not one who enjoys flat out boasting, it is very important to us that our successes are recognized so we can build the credibility we need to continue our quest to help companies find smarter ways to work. A couple of the bullet points from the release:

• We added nearly 800 customers

• We saw an increase of 325% in annual sales

• We now have over 2,000 customers, including over 15% of the Fortune 500

Also, to help us steer through this growth phase, we're announced the appointment of Tony Zingale to our Board of Directors. Tony is a Valley heavyweight, with over 30 years of tech experience including his role as the CEO of Mercury Interactive and Clarify. Tony has already been a fantastic addition to the team -- he's got a ton of energy and knows the game inside and out. I couldn't be happier to have him on board.

Download our press release

One of these metrics to track is the types of people participating in these communities.  Forrester has provided one way of looking at this for external communities called the the Ladders of Participation, which is based on  general public usage of social tools.

Forrester's take is an interesting slice into usage models and works well for most social networking sites, I'm sure. However, it breaks down a bit if you try to apply it to different scenarios since it doesn't take into account the different types of communities, of which there are many. And most of our customers aren't trying to set up social networking sites. Patrick Lambe provides a great breakdown of these types of communities in this interesting video (communities of interest, communities of circumstance, network of practice, community of practice, learning community, etc.).

For us to take advantage of a model like Forrester's, it needs to be considered in light of the business goals of each client. For instance, here's how one of our customers (a business community concerned mostly with knowledge-sharing/Q&A) looks when the model is applied. This is more of a "network of practice" according to Lambe's breakdown.

It's interesting, but weighted at the extremes, which means it's not going to be as telling, but it's still useful. Even more useful if you can set goals around it. For instance, since this particular site is interested in leads, we might want to track not only the breakdown of spectators, but set goals for conversion to collectors, where you now have more of a dialogue open with the user.

And as you would expect, this model breaks down when applied to internal communities. The types of users no longer make sense inside a company, which is typically more concerned with how fast people get answers, how much content is being created/reused, how much faster projects are completed and decisions made, etc. Out of curiosity, we decided to see how Jive's internal Clearspace instance would play out on the Ladder model:

Again, weighted at the extremes. I think the roles I would like to see for our own usage scenario would include things like:

And I would remove the "fun" communities from the sample set -- needless to say, some folks are highly active in things that aren't mission critical :).

So, the main takeaway is that different communities have different circumstances that tie them together and therefore have unique Ladders of Participation. In order for businesses to determine if they are earning the promised value of increased productivity through social participation, we need to start defining these usage models more discreetly.

With the huge spike in demand for Clearspace since we launched in February, the demand for having it delivered as a service has been increasing even more substantially. About a year ago, 10% of our pipeline was for hosted opportunities; today, it’s closer to half.

While we have gained a lot of Software as a Service (“SaaS”) experience over the last few years, the application has not been fully optimized for a hosted environment and we have had to dedicate a lot of resources to maintenance and support, thus making it more expensive for us and our customers.

As others in the software industry have seen, demand for enterprise products delivered via a SaaS solution has extended to large companies, who just a few years ago had a mandate to bring everything in house. As such, we needed a leader to take our SaaS side of the business to the next level, in terms of architecture, product management, SLAs, team, infrastructure and more. Enter Eric Butler, our new VP of Hosting Solutions.

Eric joins us from WebTrends, another Portland company, where he wore various hats over his eight year tenure designing, engineering, building and managing their world-class On Demand environment. He has a wealth of experience and a strong desire to make things happen here at Jive.

Eric has expressed an interest in participating in JiveTalks as well, so expect to see more from him soon. For now, please welcome him to the team and know that his hiring represents a commitment on our part to better support our existing customers, and provide future customers with a means to start using Clearspace in a friction-free, dedicated environment.

Why did Sequoia choose Jive to win the space?

Sequoia has a very good handle on the market, and they saw the opportunity in the same way we did - companies were stuck between too much structure (Sharepoint) and too little structure (hundreds of point solutions), and were willing to pay money to have an integrated, community collaboration system for their employees and their customers.

So when they met Jive, and found a company that had real customers, solid revenue, profitability, a motivated team, a great product, and a track record of execution, it was a perfect fit. We want to win as much as they do, and will do what it takes to get the right people involved.

Why Sequoia?

Hands-down, these guys have one of (if not the) best track record of any VC (Oracle, Apple, Cisco, Yahoo, Google, YouTube, etc.). They brand themselves as "the entrepreneurs behind the entrepreneurs," which in our experience seems to be true. There's a lot of operational experience in those walls and they work very hard for their companies. What else?

1. Smart Growth: They allow us to see the world through a longer-term lens. Instead of making decisions in the interest of short-term profitability, we now have the ability to make investments that support our larger goals, such as acquiring a key technology or investing in remote offices.

2. Recruiting: As the growth continues, making sure you get the right people on board is paramount, and a good investment partner can attract great talent.

3. Partners: We've done a great job building relationships with the likes of SAP, Oracle and IBM, but there's a lot more opportunity out there. Sequoia not only knows the right people, but is well-connected to the rapidly changing needs of those potential partners.

4. Mgmt assistance: We've got a great management team in place, but having such a stellar set of coaches helping you out makes a big difference. These folks have seen these challenges many times before, but are still open to creativity and not treating the business plan as a formula.

5. Advisors/board: As we build out the board and advisory board, they can help think through and attract the right folks.

6. Guidance: If we ultimately decide to take the company public, or if the company were to get acquired some day (not in the plans), these guys are the ones we want to have in our corner.

What will change?

Not much. We still have the same values and team. We're still laser focused on solving business problems and creating value for our customers. We've proven that we can grow this business profitably, so there's no "shoot the management team" attitude that a lot of VC's have. And we're still looking very hard for great team members.

What this does mean is that we're going to get a lot more focused on the long-term goal of winning the market, as well as building out the infrastructure to support our rapidly growing customer base. This means investing in international offices (where we already have a lot of customers), building out the infrastructure for support and sales, adding much needed engineers to our R&D team and building out the marketing to make sure we're continuing to meet our customers' demands.

Was it a hard choice?

Definitely. We are proud of our heritage as a bootstrapped company. It's helped to shape a culture of discipline and customer focus, and it's always fun to say that we never raised a dime. Plus, there's a few folks in this office that are a bit suspicious of VC's. And for good reason - there's a lot of bad ones out there who destroy companies in the name of selfish interests or bad management. But this situation is different for several reasons:

• One VC: not a bunch in the room arguing for their own needs.

• Minority stake: they're along for the ride, not driving the ship.

• Great firm: these guys didn't get where they are by forcing bad decisions.

In short, we couldn't be happier with the outcome. We are ready to take this company to the next level, and look forward to a productive relationship with Sequoia.

I get Sam's point, and I like the way he pushes us to push the envelope and try new things. Part of me really likes the idea of just putting competitive information out there and letting people have access to it (as well as the ability to change it as needed).  That said, I always think putting information on your competitors out there is very dangerous and tricky, and never seems to be worth the risk. Here's why:

1. Impossible to keep up to date: Knowing what features the competitors have and trying to keep it current is a monumental task. We just don't have the time to pay attention to new releases and new features.

2. Breeds distrust among other players: Let's face it -- the software industry is all about coopetition. Putting competitive information on the public site can burn bridges with companies that could otherwise become our best partners.

3. Customers are smart: They'll figure out what the competition is on their own, and will do their own comparison. Why would they trust our analysis for a big decision like this?

4. How do you measure?: By what measuring stick do you compare these different Enterprise 2.0 collaboration systems? Everyone takes a different approach to collaboration/content creation -- it's not a mature market, which is what makes it so great. It's not like claims processing software where you can check off if you have a PDF conversion feature. **

5. Who do you include?: Again, there are lots of different applications approaching the problem in lots of different ways. We may offend just as many companies by not including them.

6. Makes us look defensive: Publishing competitive information can often be seen as an overly defensive tactic -- people can be put off by companies that push themselves too hard against other players. The first rule of PR is not to bash the competition, and people may perceive this sort of matrix as bashing.

In short, it's a heck of a lot of work to keep this thing going, and it only serves to upset other potential partners and friends as well as confuse customers.

We're excited to announce that Bob Pasker has joined our Advisory Board. Bob has been a friend of Jive for a long time, and has gotten to know our company quite well in the process. He is most well known as the principal developer, cofounder and Chief Architect of WebLogic, but has been quite active since then with a number of companies.

Bob represents the rare mix of deep technology and business experience that's perfect for Jive. And he's a great guy in general. We're excited to make him part of the team.