JBoss alumni launch open-source startup

A startup founded by former JBoss developers will come out of stealth mode Monday to announce a new product designed to help businesses zero in on their best sales leads.
The startup, called LoopFuse, has developed a lead generation product that is offered as a paid on-demand service or as open-source software that can be downloaded for free and installed on-site.

The Atlanta-based company is entering a growing market where it will compete with several other small providers, along with established players like Eloqua, based in Toronto. LoopFuse hopes to distinguish itself with its open-source model, which it said will allow it to price its service lower than rivals' services.

Lead generation products track the activities of potential customers on a company's Web site and use factors like their job titles and activities on the site to assign "lead scores," which help salespeople to target their efforts. The products work in tandem with customer relationship management software.

Kim Collins, a research vice president with Gartner, said interest in such products is growing in all industries. The challenge for new companies like LoopFuse -- and for customers -- is that many small companies are offering similar products, each with a slightly different twist.

"They each do things a bit differently and utilize different channels for [lead] generation and distribution (e.g., Web, sales, e-mail). Some focus more on workflow and process. Others focus more on analytics and scoring. It makes the vendors and their solutions hard to directly compare," Collins said via e-mail.

LoopFuse was founded early last year by Tom Elrod and Roy Russo, who each spent three years at JBoss, the Java server vendor acquired by Red Hat. Elrod was lead architect for JBoss Remote and Russo cofounded the JBoss Portal, according to LoopFuse's Web site.

The company has quietly rolled out its product to a handful of customers over the past year. On Monday it plans to launch a new release and start marketing itself more actively.

The product, called LoopFuse OneView, includes tools for e-mail marketing, Web analytics, managing campaigns and scoring and prioritizing leads, among other things. The new release, version 3.0, will add lead management and lead nurturing tools, a spokesman said. The software is released under the GNU General Public License.

LoopFuse hopes to shake up the economies of the market. The open-source model can help vendors reduce their costs by drawing on existing software components and contributions from users.

LoopFuse OneView will be priced at US$300 per month for an unlimited number of users, although usage will be capped at about 2,500 e-mails and 100,000 page hits, said Matt Asay, an adviser to LoopFuse who is also a vice president with content management company Alfresco. Users will be able to pay more to lift the cap, he said.

That pricing compares favorably to Eloqua. Its service starts at $3,000 per month for a team of about five users, but with no limits on e-mail or page views, said Thor Johnson, Eloqua's senior vice president of marketing.

Still, Johnson said he was unconcerned with LoopForce, noting that he already has a plethora of smaller rivals. Eloqua has a battle-tested service that is being used by more than 400 customers, he said, including Nokia Enterprise Solutions, Sybase and Red Hat. It also has some capabilities that LoopFuse does not, such as direct-mail marketing, he said.

Eloqua was founded in 2000 and recently closed a $23 million funding round, which it will use to expand in Europe and Asia. Johnson questioned the ability of startups like LoopFuse to serve global businesses, or to scale quickly enough to handle big customers. "We're processing more transactions than the Nasdaq," he said.

LoopFuse will be hoping to parlay its JBoss connections and the rising confidence in open-source software to its advantage. It has partnered with open-source company SugarCRM, allowing customers to use a complete open-source stack for marketing and sales.

"While our proprietary competitors tread water, and ask you to empty your wallets for 8+ year-old brittle-ware, we're busy innovating, innovating, and innovating, by applying open source principles and methodologies to every facet of our products and business," LoopFuse said in its blog last year.