Thursday, June 21, 2007

The Open Source CEO Series

Matt just started a new blog at CNET and needs to attract visitors. Since he is a marketing genius, he came up with the idea of hosting other open source people on it that would tunnel visitors to his blog (just kidding ;-). He started with Dave Rosenberg, then Marten Mickos, then his boss John Powell and finally Javier Soltero. He quickly ran out of good names, so I ended up being the fifth. Glad to be in such a good company. I recommend reading what the other CEOs are saying, because they are very smart people.

For those curious but affected by hyperlink-laziness here you have the content of what I told him (his blog has some additional comments, but mostly around his inability to choose a soccer team that can actually win something, instead of just talking about it...).

Name, position, and company of executive
Fabrizio Capobianco, CEO, Funambol

Year company was founded and year you joined it
The company was founded in 2003, but I was working on it before then.

Stage of funding and venture firms that have invested
We raised a Series A round in 2005 from Walden International (Mary Coleman) and HIG (Fred Sturgis). We then did a follow-up round in December of 2006, for a total of $10.5 million.

Background prior to current company
Funambol is the third company that I have started. The first one, in 1994, was Internet Graffiti - the first web company in Italy. The entire operation was run on Linux machines, loaded with the slackware distro (yep, that's A1, A2, ... floppies). In the late 1980s I was enlightened to the path of open source by Alessandro Rubini, a colleague in my university lab, where he wrote the Linux mouse device driver. My last serious job was at Reuters in 2002, where I ran operations around an online trading platform.

Biggest surprise you've encountered in your role with your company
The speed at which the industry has warmed to commercial open source. In late 2004, people started to believe me when I told them that I had found a way to balance being open source and making money, also known as funambolism or tight-rope walking. Before that, people dismissed me with "Yeah, right. Good luck with that." It changed so quickly - almost overnight. I was shocked.

Hardest challenge you've had so far at your open source company
Convincing salesmen to filter out 99% of their leads. The biggest issue for an open source company is defining its focus in the sales process. Going after anybody that comes to your door - even if they want to pay you - is guaranteed suicide. Commercial open source is all about qualification and filtering. It is tough to tell someone, "Sorry, we are not going to sell to you, even if you want to buy," but particularly if you're a salesperson. But you must if you want to succeed.

If you could start over again from scratch, what would you do differently?
I would try harder to hire Matt Asay. Letting him go to Alfresco was a mistake. Hey, you makes mistakes here and there.... :-)

Top three pieces of advice for would-be open source CEOs

  1. Do not chase every lead that comes in the door. They might be few at the beginning, but if your project is a success you will be inundated by them. Build processes and tools to qualify your leads and make tough choices or you will drown quickly.
  2. Fire anyone that says "We win simply because we are open source." Being open source is just a component of your strategy and most likely your big differentiator. But if all you have is that you are open source, someone else will do the same and kill you.
  3. If you realize your project is not growing fast enough, maybe you made a mistake to make it open source in the first place. You need a big market to have a large open source project. If you attack a niche, you won't make it. If this is the case, look for the next gig. There is probably nothing you can do about it. De-open sourcing is not an option.