Recession Upside for Enterprise 2.0 Upstarts

10.11.2008
At the Web 2.0 summit last week, the tightening economy left the future of Web 2.0 start-up companies uncertain, not only in the consumer space as ad dollars fluctuate, but in the enterprise too. Enterprise 2.0, the market of vendors that sell technologies such as blogs, wikis and social networking applications to companies, is likely to become more competitive as IT budgets get trimmed.

One Enterprise 2.0 vendor, , emerged during the last recession. Along with his co-founders, , the company's president, realized that social technologies such as blogs and wikis, which were being used heavily by unemployed workers in Silicon Valley to communicate with one another, could be utilized within corporations for collaboration purposes.

In an interview with CIO during the final hours of the Web 2.0 Summit, Mayfield said that while times are tough, it could be an opportunity for Enterprise 2.0 vendors to seize market share from (with its ) and , both of whom, he adds, will cost enterprises more money.

CIO: How does the period we're in affect the Enterprise 2.0 market and vendors like yourself?

Mayfield: With everything that's happening with the election and the economy, the one constant is change right now. For our customers, they need to learn how to sense change and what's happening in the market, as well as the opportunities and the risks that they need to respond to. They need to make sense of the change by collaborating internally around what they learn. And that's where we come in. Before the recession hit, enterprises were looking at collaboration as a strategic imperative. It was at the top of their lists for initiatives. I don't think that's going to change. You don't get people to be productive by grabbing someone, shaking them and saying "work harder." You get better productivity by aligning your groups, by having people work together better. So the current environment brings focus, both to vendors like us but to customers as well and where they're going to spend their energies.

CIO: A company like yours doesn't have the deep pockets of a or an IBM. How do you weather the storm with them in the market? How will you and your Enterprise 2.0 start-up contemporaries fair against them?