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Collaborative Tools

The iPhone of Spreadsheets is Coming Through the Back Door

Spreadsheets. Hardly an exciting or innovative field of software, but one that is completely ubiquitous around the world. Whether you’re heading a Fortune 500 company or the local corner shop, it’s inevitable that Excel, Google Sheets or Apple Numbers will play an important part of your life.

Smartsheet want to break that hegemony. “Our analogy is how the iPhone consolidated the personal devices - they took them all and consolidated them into a phone,” says Executive Chairman and Co-Founder Brent Frei. “And we've done the same thing on Project, Access, Sharepoint, and the spreadsheet into the spreadsheet UI.”

Smartsheet isn’t the first to try and reinvent the spreadsheet, and former Onyx Software CEO Frei is well aware of this. “The definition of insanity was at play - every year there was another 15 derivatives of Microsoft project coming out,” He says. “After 450 tries, the 451st company really thinks they're going to do a version of Microsoft projects that's finally going to work? It's just kind of mind numbing when you think about it. The spreadsheet it still going to kick their ass.”

The company’s Cloud-based software mixes online project management, collaboration and file sharing into one Excel-like UI. “Our bet is that by consolidating productivity tools into the UI that people choose that we could crack this nut finally and someone could build the tool that becomes an essential utility across companies big and little to coordinate anything.”

Sneaking In the Backdoor

The company recently raised $35 million, adding to the $35 million they already had, but the company are coy about revenues. “We're well north of $10 million and we're south of $100 million,” is all Frei will admit to. “Despite our intention to spend and grow - we don't intend to be profitable right now as we're taking market share - the business is going very well.” The company has seen its 4th consecutive year of 85% growth and gained some high-profile users. Google, Cisco, Groupon, Netflix and Pandora count themselves amongst the Washington-based company’s clientele. “The last couple of years have been a real rocket. We have gotten enough exposure inside of big enterprises and its spread quickly across a lot of dimensions inside the big enterprises that we're closing now on enterprise size deals.”

In many ways, Smartsheet’s approach is an IT nightmare. Frei admits that the company is one of those 'come in the backdoor' apps. “Turns out the back door's the easiest way to go in because you're not trying to build a case for the decision makers before the actual users have gotten up and championed something.” He explains that through this Bring Your Own App approach Smartsheet can grow from the bottom up through viral expansion inside these companies, and their success is largely because of their focus on solving the problem for “the person in the trench.”

Turns out the back door's the easiest way to go in because you're not trying to build a case for the decision makers

“By the time we hear from a lot of these companies it's because they've got 30 or 40 different groups of people using Smartsheet and it's become so critical inside the business that they now say, "Hey we've got a lot of data and sensitive information and priority processes being run in this tool, let's go make sure that they're a legitimate company, that they have real security, that they have sophisticated tech operations - internally, not just with the product.” To make sure when that time comes, the company has spent the last couple of years becoming enterprise ready; lots of effort around security, APIs, admin features, and a lot of behind the scenes work on reliability and backup etc. “Our internal mantra is "consumer easy, enterprise ready"; the consumer easy is a way for someone to find our product and adopt it, the enterprise ready is when the front door opens and they look at us.”

The average user would embrace Smartsheet for formal project management, but that’s just the start. The last Superbowl was planned and co-ordinated using Smartsheet, educational institutions are using it to manage syllabuses, Groupon uses it for their auditing processes. There’s even a Goat farm using it for ‘everything other than their accounting’, including goat-breeding, barn construction, QA, cheese machine maintenance, packing, marketing and sales. “It's really interesting because often people will find us for more a traditional reason, project or event co-ordination and then they'll discover the flexibility and it will just take off in some other direction.”

Spreadsheets vs. Smartsheet

For a company expressly trying to replace Excel and its ilk, Frei doesn’t think about the like of Microsoft and Google as the enemy. “Spreadsheets will continue to be unique and dominant in that they are great for financial analysis, data analysis, charting, pivoting, all the things that are data and date analysis orientated but collaboration around work and projects, that's what we are carving off from that,” he says. “The way to think about it is that it is a replacement for a big swab of what you use spreadsheets for and it's a compliment in other ways.”

“We're not really in competition with Google, it's very much a complement. We've found that where someone has google apps installed and Smartsheet, their google apps usage goes up. It's an amplifier of their cloud tools. Microsoft it's early days there because they've only just gotten to the Cloud with their office tools.” So is he worried about Nadella & Co.’s move to the Cloud? “I look at it the other way; now they're in the cloud we're going to be be able to amplify them the way that we've done it with Google.”

“They've [both] built their spreadsheets to be this, they've built their word editors to do that and there's no indication that they're going to innovate and consolidate those into one far less expensive multi-purpose tool like ours. They're going to stay in their $22 billion swim lanes with Office.”

There is no killer app in work collaboration and work management yet. How many online business tools do you know today that are useful for everyone in the whole company?

When asked if the likes of Google or Microsoft could acquire the company to fill the gap Smartsheet occupy, Frei says it’s a possibility. “We view this as a good target for a lot of companies. The market is giant and there is no killer app in work collaboration and work management yet. How many online business tools do you know today that are useful for everyone in the whole company? Outside of email, calendar, office and filesharing, what's left? I would argue there's a list smaller than the fingers on one hand that we are on; we are useful for everyone. I think we are a unique target in that we fit well into the enterprise, we can make a credible case that every single employee can and probably will use us, and that there's value in it.”

So is being acquired more realistic goal than IPO? “I would have told you maybe 2 years ago that was the most likely thing,” he admits. “But given the breadth of our market opportunity and the pace at which we're growing I would say it'll be a horserace to see whether it's an IPO before we have to make a hard decision.”

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Dan Swinhoe

Dan is a journalist at CSO Online. Previously he was Senior Staff Writer at IDG Connect.

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