Socialtext: Giving Enterprise 2.0 a cash boost

Posted Nov 5th 2007 3:45PM by Tom Taulli
Filed under: Google (GOOG), Cisco Systems (CSCO), International Business Machines (IBM), Adobe Systems (ADBE), Small Business

While there's been lots of buzz about Web 2.0, there's another interesting trend that's not getting as much noise: Enterprise 2.0. Basically, this is corporate software that uses social approaches, such as blogs, wikis, social networking and so on.

One of the leaders in the space is Socialtext, which snagged $9.5 million in venture capital this week. The investors include Draper Fisher Jurvetson, Omidyar Network, and SAP Ventures.

True, biggie software companies -- like IBM (NYSE: IBM) -- have been investing in Enterprise 2.0. But as with any trend, it is usually smaller firms that make the critical innovations.

What's more, Socialtext has a new CEO, Eugene Lee, who was formerly with Adobe Systems Inc. (NASDAQ: ADBE) as well as Cisco Systems, Inc. (NASDAQ: CSCO). He will try to expand the firm's footprint beyond its base of 4,000 customers.

I also see this venture round as a defensive action. After all, Google (NASDAQ: GOOG) bought Jot.com last year, which is an enterprise wiki/blog developer. Might we see a launch from the search giant?

I certainly think so. In other words, Socialtext will need as much money as it can get.

For more information on other recent VC deals, visit DealProfiles.com.

Tom Taulli is the author of various books, including The Complete M&A Handbook and The Edgar Online Guide to Decoding Financial Statements.

Tags: CSCO, GOOG, IBM, Socialtext, Venture Capital, VentureCapital, Wikis

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