Business & Finance
News
9/27/2007
05:00 PM
Connect Directly
LinkedIn
Google+
Twitter
RSS
E-Mail
50%
50%

Startup Of The Week: Spiceworks Trades Software For Ads

Spiceworks IT Desktop is network monitoring and management software that’s entirely ad-supported.

Another IT management tool? Boring--until you realize it's free. Spiceworks IT Desktop is network monitoring and management software that's entirely ad-supported. Customers download the software for free in exchange for ads on the management screen.
--Andrew Conry-Murray

SPICEWORKS

PRODUCT: Spiceworks IT Desktop

FOUNDED: 2006

PRINCIPALS: Scott Abel, CEO; Greg Kattawar, VP of development; Francis Sullivan, CTO; Jay Hallberg, VP of marketing

FUNDING: $13 million

INVESTORS: Austin Ventures, Shasta Ventures

CUSTOMERS: London Symphony Orchestra; Master, Sidlow & Associates; Fort Maier Homes; Pioneers Medical Center; Intelligent Decision Systems

MARKETS: Spiceworks targets businesses of up to 250 employees with IT staffs of one to five people. IT Desktop performs agentless discovery, inventories the network, and monitors configurations of discovered devices. It supports Windows, Linux, Unix, and Mac and includes basic help desk capabilities. The user community provides collaborative help. The company has 120,000 users.

Scott Abel, CEO

Free is a good business model for Abel


BUSINESS MODEL
Spiceworks uses Google's AdSense to display ads on the right-hand side of the management console, which is a Web browser. The ads are text-only and take up about 15% of screen real estate. The company has established advertising relationships with tech vendors such as Netgear and Symantec. No information about their customers' networks is sent to Spiceworks. Instead, ads are presented in general categories, such as servers, printers, security, and software.

OPPORTUNITY
Small businesses weren't being well-served by existing IT management products, which can be expensive and hard to use. "We thought we'd do the Salesforce .com of IT," says Hallberg. "But what if someone came up with a cheaper alternative to our SaaS model?" The company decided "free" would be hard to beat. Spiceworks runs on Windows, which helps differentiate it from low-cost, open source options such as Zenoss and Nagios that require some Linux experience.

EXIT STRATEGY
Given the regulatory mandates that have been piled on public companies in recent years, Spiceworks is less inclined to run for an IPO. "We'd be more inclined to being acquired than going public," Hallberg says.

TIMELINE
Timeline Chart

Comment  | 
Print  | 
More Insights
The Business of Going Digital
The Business of Going Digital
Digital business isn't about changing code; it's about changing what legacy sales, distribution, customer service, and product groups do in the new digital age. It's about bringing big data analytics, mobile, social, marketing automation, cloud computing, and the app economy together to launch new products and services. We're seeing new titles in this digital revolution, new responsibilities, new business models, and major shifts in technology spending.
Register for InformationWeek Newsletters
White Papers
Current Issue
InformationWeek Tech Digest - July 22, 2014
Sophisticated attacks demand real-time risk management and continuous monitoring. Here's how federal agencies are meeting that challenge.
Flash Poll
Video
Slideshows
Twitter Feed
InformationWeek Radio
Live Streaming Video
Everything You've Been Told About Mobility Is Wrong
Attend this video symposium with Sean Wisdom, Global Director of Mobility Solutions, and learn about how you can harness powerful new products to mobilize your business potential.