Jim Lejeal has written a great post on Working With Microsoft.  Jim is CEO of Oxlo – one of our companies – and was previously co-founder and COO of Raindance (now publicly traded on Nasdaq – RNDC – I was one of the first round investors).  Microsoft is a key partner of Oxlo’s (all of Oxlo’s technology is based on Microsoft technologies – including Biztalk and Sharepoint) and Microsoft was an investor in Raindance.  So – Jim’s had plenty of experience in this sandbox.

I’ve been a long time Microsoft partner and advocate – going back to my first company (Feld Technologies) which was in the first class (around 1990) of Microsoft Solution Providers (I still have the plaque with Dawayne Walker’s name on it somewhere).  Many of my current investments – including Commerce5, ePartners, Gold Systems, Newmerix, NewsGator, and Oxlo – have deep relationships with Microsoft and extensively use Microsoft and .NET technology as part of their products and services.

I’ve learned a lot about what works and what doesn’t work with Microsoft over the last 15 years.  Jim’s advice is worth reading.

Today, NewsGator announced a broad European partnership with VNU.  NewsGator is partnering with VNU to distribute both their consumer and enterprise RSS services throughout Europe, with an initial focus on UK, Germany, France, Holland, Italy, Belgium, and Spain.  This shouldn’t be a surprise to anyone following NewsGator and RSS as JB Holston has extensive experience in Europe and RSS and blogging are expanding very rapidly throughout Europe (George Bush even visited Europe the other day – wow – Europe must be relevant).  VNU – the leading IT media company in Europe – is in a great position to leverage RSS and help accelerate adoption throughout Europe.

Return Path just released a study showing that a majority of users of Gmail come from existing Microsoft Hotmail users who are switching to Gmail.  The stats are interesting – of new Gmail users that switched from something else:

• 57% from Hotmail
• 27% from Yahoo
• 16% from AOL, MSN, and Comcast

I’m hanging out at Microsoft for another day during their PAC conference so it was pleasant to see a release from ePartners that they are partnering with 5by5 to use 5by5’s Bridgewerx product as part of ePartners’ Microsoft BizTalk integration services.  Microsoft continues to blow me away in how they work with and manage their partner relationships across all lines of business and – at this meeting – I’m seeing a very clear focus from them on expanding and embracing their partners even further.  One of my other companies – Oxlo – is also a deep BizTalk partner (it’s a key part of their product) – BizTalk and Sharepoint are definitely getting a lot of play as the next wave of Microsoft server-related products.

Greg Reinacker – founder and CTO of NewsGator – posted NewsGator’s near term product road map today.  The gang at NewsGator has been heads down cranking on a number of fronts – I’ve been encouraging Greg and crew to be more open about what’s coming next.  Greg historically has been very tight lipped – by his own admission – so we had some interesting (and useful) conversations about this. 

While I’m not a proponent of vaporware or FUD, I do believe it’s useful for young companies to be open about what they are working on.  Customer and partner feedback is hugely valuable as you are developing a new set of software products and it’s easy to get the word out there (e.g. via blogs) and get feedback (e.g. via comments, emails, and cross posts).  In today’s fast moving world of software and short release cycles, I think a clearly articulated product vision, early beta programs, and lots of forums for feedback helps dramatically improve software product quality and value over the long term.

I was on a phone call yesterday with a co-investor in one of our companies who asked “are you concerned that RSS / blogging is the long tail of the Internet – only relevant to millions of individuals, but nothing beyond that?”  I responded with an emphatic no.  I noticed two things this morning as I was poking around that reinforced this. 

1. Greg Reinacker’s blog post on NewsGator Outlook 3.0.  Greg is the founder/CTO of NewsGator and on Wednesday afternoon he asked the question “what do you want to see in the next version of NewsGator?”  We’re in the midst of the development cycle and still have room for some more features, so we’re looking to see what people think are today’s “killer feature” for the next version of the best RSS aggregator for Microsoft Outlook.  By Saturday morning, there were 30 separate posts with over 75 suggestions.  Many of these are features we are already incorporating, but some were new, and it was fascinating to see the patterns.  I’ve long been a believer in the theory that users are the source of most innovation (this is one of the things I worked on in my doctoral program at MIT under Eric von Hippel and is obviously a huge driver of the open source revolution.)
2. Peter Hoskins’ blog post on SpikeSource referring back to his blog post on open source stack management.  SpikeSource’s news page has a section on it called “Blog Mentions of SpikeSource” (in addition to the normal “SpikeSource Articles” section from traditional media).  Smart move – every company should put something like this up on their news page.  It’s not a surprise that Kim Polese – the CEO of SpikeSource – has a clue – as she’s on the Technorati board.

While different cases (case 1: use blog as user community to generate new feature requests for product; case 2: reference blogs as equivalent to traditional news sources about product / company), both are powerful examples of the quickness, ease, and leverage of blogs as a part of the corporate communication and information collection process. 

Oh – and I’ve never really worried about “the long tail problem” – I don’t think it’s a problem if the tail is “long” enough.

If you are Denver/Boulder based, my portfolio company – Rally Software – is in Denver on Friday, February 25th as part of their “Rally Agile Roadshow” to spread the message about Agile development and how to transform your software development organization to Agile processes.  Attendees will also be registered in a drawing to win either a day of Agile Coaching or a free pass to the Agile 2005 conference.

On Monday, Stratify announced release 5.0 of their Stratify Legal Discovery product.  This is a major product release for them, as it incorporates a raft of new features and gives them a huge technology leadership position in the legal discovery software market.

Today – Stratify announced that Merrill Corporation – the leading global supplier of diversified communications and document services – has signed a partnership to integrate Stratify’s products with Merill’s Discovery Navigator (Merrill’s proprietary electronic repository technology).  Merrill is a huge established service provider to top law firms and Fortune 100 companies and this type of deal is – in the words of my partner Rex Golding – a classic transformational channel deal. 

If you sell enterprise software and services, you have to have partnerships like this to be successful.  Our company Cyanea is a poster child for this – they had an OEM deal with IBM early in their life which had a dramatic positive impact on their growth and ultimately resulted in IBM acquiring them for a very nice price due to the success and customer adoption of Cyanea’s products. These partnerships must work both ways – Merrill sees huge value in Stratify’s product (we’ve been through an extended and deep evaluation period where we were chosen over other companies) – and Stratify is delighted to be part of Merrill’s toolkit that they sell to their customers.

There was a flurry of news from several of my portfolio companies the last few days.  For those of you that track what I’m up to, here it is:

• Xaffire closed a $3m financing.  The company had a great Q404 – landing several significant customers and building real momentum with a couple of key partners.  Wendy Lea – an experienced entrepreneur, sales and marketing consultant, and ex-Siebel exec joined the board.
• ePartners has begun reselling LiveVault’s Online Backup and Recovery Service.  The ePartners customer base is one of the largest collection of mid and upper market customers of Microsoft Business Solution products (they added over 300 new customers last year.)  As one would expect, they’re systematically expanding their services with third party products that enhance the range of services to their customers – in this case augmenting their existing Business Continuity / Disaster Recovery offering as well as fulfilling record retention and regulatory requirements mandated by Sarbanes-Oxley.
• Stratify released v5.0 of their Stratify Legal Discovery product.  In addition to a range of new features, they’ve added visual email analytics capability, which enables litigators to identify critical relationships in email message flows as part of their legal discovery process.
• Rally announced the availability of Release 4 of their on-demand software development management solution for Agile teams.  One of the cool things about making (and using) an Agile product is rapid release cycles – Release 3 came out on August 16th – not a bad rev cycle for an early stage company.
• StillSecure Border Guard was awarded “Best Buy of 2004” by SC Magazine: They won top rating in the IDS/IPS (Intrusion Detection / Prevention) category. 

It just turned Wednesday – not a bad start to the month.