Jive Looks To Play With The Big Fish

This week, Jive Software, a leading player in social technology, announced it has closed $30 million in Series C financing, with Kleiner Perkins Caufield & Byers (KPCB) joining Sequoia Capital as the company’s venture investors.

So what does this mean for CIOs and IT, the custodians of enterprise technology architecture?

It is clear Jive wants to play with the big boys in the enterprise software space. To date, many Jive deployments have not involved IT. This ability to deploy its technology without IT’s involvement has no doubt helped Jive to this point. Of course, having market-leading functionality hasn't hurt. (Jive has featured highly in recent Forrester Wave reports).

At the recent Enterprise 2.0 conference in Boston, I sat down with Jive’s new CEO, Tony Zingale, to explore the company strategy. From our discussion, it was apparent that Jive intends to compete for a big slice of the enterprise collaboration marketplace. Fundamentally, this is the right direction for Jive, but I foresee some big challenges for the company along the way.

In targeting the enterprise collaboration space, Jive moves from being the big fish in a small social technology pond to being the small fish in a much bigger pond. It is jumping into Microsoft and IBM’s pond. As Jive looks to reach into global enterprises to become the content and collaboration platform of choice, it must address architecture concerns that IT will inevitably raise. Jive works well as a standalone social application, but integrating Jive into any established enterprise space could prove challenging. And Microsoft and IBM are not swimming around waiting for Jive to eat their lunch.

Microsoft has already done a major overhaul of Office and SharePoint with Office 2010, building social networking right into the platform (see also the post by Rob Koplowitz: Is SharePoint 2010 Social Ready For Prime Time?). Many of the features I love about Jive's applications are built right into Outlook 2010. When integrated with Unified Communications, some might think the evil empire has built its death star. The huge advantage Microsoft has is its ability to integrate seamlessly into Outlook – still the dominant email platform in the enterprise.

Not to be outdone, IBM has been beefing up Lotus Connections and adopting what I see as a smart strategy: designing the social application components to be embedded alongside other enterprise applications (even those from Microsoft). If it is successful, it will make Connections a major contender in the social enterprise space. (See related posts from colleagues Sheri McLeish and Ted Schadler.)

As mentioned in my post on the Enterprise 2.0 conference, Cisco is also looking to get into the game. And let’s not forget Oracle and SAP. So this is not going to be a slam-dunk for Jive. Winning over IT will be a lot harder than winning over Marketing.

The question many CIOs will be facing is whether they should consider Jive for a collaboration platform. There are certainly cases where Jive fills this role successfully – just this year I wrote a case study on United Business Media, highlighting its success in implementing Jive for enterprise collaboration. Nevertheless, for an enterprise with a heavy investment already in Office/SharePoint or Lotus, the choice is more complex. Many EA teams are just beginning to think of a Social Enterprise Architecture.

To fulfill its potential, Jive must demonstrate its ability to assimilate its platform architecture within the enterprise. Ultimately, Jive’s investors have their eyes on their exit strategy. My guess is that they will attract one of the bigger fish in the enterprise space before an IPO, but they may hold out for the IPO in the hope of getting a higher return. Either way, we might look to see which enterprise vendor is far enough behind the social learning curve to see a Jive acquisition as an economic way to play catch-up.

What do you think? Add your perspective in the comments below . . .

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Other IT considerations?

There are pros and cons to having your collaboration platform tied directly to your productivity suites vs. having a looser coupling. The question for Jive is how well they will expand their current integration capabilities. While the productivity suite integration is important (Jive supports this to a large degree today), how this paradigm extends into other vertical software suites, i.e. talent management, CRM, supply chain management, etc. is also worth considering. There is a need for continuous social layer throughout the enterprise. I cringe at the possibility of every application being social but unconnected. I'm not convinced that the big players can be agnostic enough to support integrating potential competitors' offerings. This is where a vendor neutral platform could bring value. I believe this is also at the heart of their app store strategy. If a large entity purchases Jive, this potential could be left unfulfilled and we would be left to suffer at the hands of the evil empire(s)...

Other IT considerations?

Thanks for sharing your insights Ed. I agree, it will be very interesting to see how Jive uses its funding to support application development in the areas you mention, as well as around email integration and file sharing. Jive also faces the challenge of developing broader relationships with the system integrators in order to penetrate large enterprise accounts at scale. Jive is not yet a market leader as a content and collaboration platform and we shall see if it can catch up to Microsoft and IBM Lotus in terms of breadth of functionality.

Jive Platform replaced Socialtext?

We're currently evaluating various social platforms so this post about Jive's recent funding and positioning is very interesting. I also checked your case study which you referenced for UBM. Just want to confirm that the UBM case study is about Jive. Jive is never mentioned in it. However SocialText is. You say the wiki pilot project UBM started with failed when it was expanded from 30 participants to 300. And you specifically say it was a SocialText project. I'm guessing the failure had nothing to do with the fact that it was a SocialText deployment, but you say UBM needed a more robust platform. Still, Jive is never mentioned as the more robust platform. I need to be clear about what Jive could deliver that SocialText could not. Thanks.

Jive Platform replaced Socialtext?

Hi Tom,

Yes, UBM did select Jive. I should also add that UBM indicated that the gaps they found in SocialText were in an earlier version of that platform - drawing any inference of one being better than the other would be unwise without comparing the latest versions against your own unique requirements. I would recommend drawing up an RFP of your own organization's must have's vs. nice-to-have's and putting it out to tender.

Tip: Something many people often omit from RFPs that I think is essential is the business background as to why features are required - providing this background gives vendors the flexibility to address the business need vs. just saying they do or don't have a certain feature. Often vendors can bring their expertise to bear in ways that obviate the need for what seem to be essential requirements.

Having experienced both IBM

Having experienced both IBM (Quickplace) and MS (SharePoint) products I think from an end-user perspective Jive has little to fear. IT, unfortunately, is another matter.

Jive for enterprise but what about mid-market?

Great blog... As a provider of a SaaS, mid-market social platform I'm really interested to see what Jive is doing and where it is going. I'm curious if SAS or someone like that will end up acquiring them for their new SaaS offering also. Cheers.