Milestone Group Quarterly: January 2009
Articles
Face to Face:
Bertrand Diard, CEO of Talend
Milestone: Tell us about Talend.
Diard: We are the leading provider in the open source space for data integration tools. I started the company at the end of 2005 with my co-founder Fabrice Bonan. Prior to starting Talend, Fabrice and I worked together for a large system integrator in Europe and managed a business unit dedicated to data integration with over 100 consultants who were implementing many data integration projects using technologies like Informatica and IBM's Data Stage. We saw a lot of issues with traditional data integration software on the market at that time. We decided to build a dedicated solution for data integration using a disruptive model like open source.
Fabrice and I were convinced the open source model was a good one for data integration. The history of Talend so far has proven us right, with 3.3 million downloads, over 400 paying customers (including companies such as Yahoo, US Cellular, eBay and ING) and now we are over $20 million in funding raised (including $12 million that we just announced). The success of our solution is phenomenal.
Milestone: Can you share your views on the data integration market? What are the drivers and the economics? What kind of pain are people solving with data integration today?
Diard: Data integration is an issue for all companies, of all sizes, in all industries. Something about the market that is very interesting is that every year your data volume doubles in the enterprise. There are actually two major segments in this market. The historic application of data integration is for the analytics market, and is called ETL (extract, transform, load). All the traditional players work just on this space. This part of the market is about $2 billion in size, according to IDC. The other part of this market is the operational data integration space, which IDC says is $11 billion. Operational data integration comprises the processes that synchronize, load and transform data between the different applications, databases and other systems in the information system. For example, you might have an HR application, a SaaS-based CRM application, and a few Excel spreadsheets. All this needs to be synchronized with your company directory, based on LDAP. That synchronization is a good example of operational data integration. You would never deploy a traditional tool like Informatica or Data Stage for this type of project, its very complex and it’s very expensive – you would likely have to spend a half million dollars just to synchronize these systems. Open source brings a strong value proposition there.
Milestone: In the current struggling economy, in what way, if any, have you changed the focus of Talend?
Diard: I think the economy is very complex for all the players. However, we have not changed our focus. We built the company to be agile, and we just need to optimize our delivery model - this is our focus in the current context. We need to do more with the same investments (I suppose that is the case for most companies today anyway). We need to be careful with what we do and we need to optimize each part of the sales cycle, the marketing cycle and the delivery. We also need to reinforce our research and development, because we need more innovation to achieve our very ambitious value proposition.
Milestone: What's the biggest impact for Talend, in adopting an open source strategy?
Diard: That is a key element of our operation and development. When you start a software company in an existing space, probably the most difficult part is your capability to deploy your product globally. In addition, when you start your company on the European market, especially in France, you are faced with a somewhat small domestic market (especially when compared to the US market). So you have no choice but to deploy globally. Open source brings a great value proposition to this equation, when you launch your company and your concept, you automatically become global. When you decide to compete directly with players such as IBM or Informatica, open source levels the entry barriers and lets you grow within your potential customer base. In the end, your users pay only for what they need in the open source model. Users try before they buy and it’s clearly the opposite of the traditional software model.
Beyond the global deployment, the power of the community, especially in the domains of feature requests, QA, community support, translation, development of connectors, etc. is phenomenal and dramatically accelerates our ability to expand our feature set and the robustness of our product in a very short time.
Milestone: You started the company in 2006 and made the transition from Paris to Silicon Valley. What was the biggest surprise you faced as you reflected on this critical stage of moving from Europe to the US?
Diard: It’s very difficult to summarize all of the surprises because the US and Europe are very different worlds in terms of the agility of business. The biggest positive surprise is the ability for people in the Silicon Valley to understand very quickly the value proposition of the Talend offerings. If you provide this value proposition, all the doors can open for you, and you are granted access to the key decision makers. This is a big difference from the culture of the European startup market, where you have to prove the financial structure of the company or have large installed clients before you are invited to the table. Silicon Valley is more pragmatic. If you create a compelling value proposition in the US, you can play in the game with the big players. So far this is the biggest difference I have noticed with Europe.
Milestone: What advice would you give to a first time entrepreneur beginning a new start up?
Diard: The most important thing is to build a differentiator in your market space. Generate a compelling value proposition because you need that for the long term. An entrepreneur needs to be disruptive to survive. It’s very complex to evangelize a completely new market but if you can create innovation and a real value proposition, you have a real chance to succeed. Also, it helps if you don't need much sleep.
Milestone: With that latest round of funding you just announced, what is your view on how VC is changing and how it needs to change to support entrepreneurs?
Diard: The software space is a very complex one. In the traditional software business, it's very complex and expensive to build a global company, one that has a chance of competing globally. VCs need to find an alternative model, very disruptive directly in the face of the old model. Probably for a VC, the best shots today are with SaaS and open source. They need to invest in differentiating companies which have a great value proposition, innovate and create a true major disruption. As an entrepreneur, we need to explore new ways and new models and we need to create the right model with metrics to measure our success - there are no pre-set matrices.
Milestone: You have certainly been involved in several innovations throughout your career. What is the essential trait, skill or ingredient is required right now for an entrepreneur to be innovative?
Diard: Innovation is very important because that is the core of the value proposition. Some people innovate for the beauty of the concept, some use innovation to address issues for the clients. The most important thing about innovation is to understand when you can address an important business issue for the part of the market and help your clients move faster. Innovation is clearly a barrier of entry for your competitors; it's a key element of your value proposition and your long term value.
Milestone: If you weren't doing Talend, what might you be doing?
Diard: I don't know. I would probably be building another company. It's my second company and I just love to do that, but please don't tell my wife!
__________________________________________________
Bertrand Diard is co-founder and chief executive officer of Talend. He is also a founding member, Open Solutions Alliance. Prior to co-founding Talend, he was managing a Business Unit of one of the largest European systems integrators. Bertrand has extensive experience with managing large integration projects.
|
