SugarCRM eyes a public offering

Interview: SugarCRM co-founder Clint Oram talks about the company's business model, rival Salesforce.com, and plans for the future

Oram: That was actually a pretty strategic key decision that we made back in 2004. When we set out, we thought we were going to build a Java application on top of Oracle. That’s what everybody was doing back in 2002, 2003, and 2004. And as we sat down and started prototyping the application, we were actually prototyping it in PHP just because PHP was quick and fast to build a user interface in. Then we started looking at all the different PHP applications that were available on SourceForge. So that’s where we got started, and we started looking at the other PHP applications. One of the key things we looked at was we really wanted to have as many people in the world using SugarCRM as possible, and frankly, PHP is just more accessible than Java for the average person.

InfoWorld: Who are you taking customers away from -- or are you just getting new CRM customers?

Oram: Well, there’s a combination of both. Basically one of the fascinating things about the way the open source model works is that [with] traditional software proprietary models, you spend two years building the software solution, then you go hire a really expensive marketing and sales organization, and then you go out and [do] target marketing into specific segments, hoping that what you’ve built would meet their needs. Hoping that what you just invested in building would actually be the right solution. Open source has a completely different approach in that we build our solution, we post the Community Edition on the Internet, and downloads happen around the world. We have downloads in every country in the world happening right now. And that demand pulls us into markets. So our phone has been ringing off the hook since we first started launching the company back in 2004. We’re not targeting specific segments, we’re not targeting specific sizes of companies. Companies are calling us. We have customers from the smallest of SOHOs [small office/home office] to SMBs [small/medium-size businesses] to SMEs [small and medium-size enterprises] up to the largest of enterprise. … We’ve taken customers away from pretty much everything, from the smallest of solutions up to Siebel's. 

InfoWorld: What license are you using?

Oram: Our Community Edition is licensed under the GPL (GNU General Public License) v3.

InfoWorld: Why did you go with GPL 3 over GPL 2?

Oram: When we were looking at the GPLv3, basically what we saw is the most modern open source public license that’s going to last for the next 10 years plus. The v2 was written over 10 years ago [and was] really designed for a different age of computing. The Internet really hadn’t taken off.

InfoWorld: What is the benefit of v3 for the Internet?

Oram: It’s got some provisions in there about how the distribution of the software comes into place, how the patent protection comes into place as well. It’s a more modern license and we really felt that we wanted a license that would go with us for the next 10 years.

InfoWorld: What is SugarCRM's sales model?

Oram: You can download Sugar, open source Sugar Community Edition today. Go to our Web site, download it from there. No restrictions around distributing it, around modifying it, all the things that you’d expect with publicly licensed software. We have three editions: Sugar Community Edition, Sugar Professional edition, Sugar Enterprise edition. The Professional and Enterprise editions are commercially licensed products; these are the subscriptions that we sell. You can deploy them on-site or on-demand, so there’s kind of two dimensions there.