Jive Software raises $15M, takes on Microsoft in Web 2.0 office

Microsoft Office, the popular office software, works great for most purposes, but it lacks good software for employees to collaborate on products — co-writing documents simultaneously, for example, or letting them archive online conversations.

Sharepoint, Microsoft’s offering, started as a simple file-sharing system, but its features have been limited. For Wiki features, for example, Microsoft established a relationship with separate wiki software company, SocialText.  Sharepoint continues to improve, but slowly. It’s being challenged by host of newer, nimble start-ups.

One with considerable momentum is Jive Software, a Portland, Oreg. Its product, Clearspace, doesn’t tack various software programs together. It offers it all from ground-up: It lets employees and customers collaborate on a mix of blogs, wikis, forums, chat, tagging, files and reputation systems into a single interface behind the corporate firewall (or outside it, if customers are involved, in which case it governs a publishing system that controls what gets outside the firewall). The company was bootstrapped for years, but in February, hit a vein, says chief executive Dave Hersh — demand for its product became overwhelming.

Jive works instead of Sharepoint, or on top of it.

Jive will do more than $15 million in sales this year, with the second quarter revenue almost double what it was the same quarter of last year. It has more than 2,000 customers, says Hersh, mentioning names like IBM, Sun and BEA. So it has taken $15 million from Silicon Valley venture firm Sequoia Capital, to handle the growth.

The company has been profitable since it was founded in 2001. It says the collaboration market could reach $9 billion by 2009.Other players in this area include Dropbox, the very young Y Combinator company we wrote about yesterday; Intel offers SuiteTwo, which combines Socialtext (wiki software), Six Apart’s Movable Type (blogging software), Newsgator (RSS reader) and Simplefeed (RSS distribution). There’s also Blotronix.

Microsoft’s Sharepoint saw $800 million in sales last year, and it’s Microsoft’s fastest growing product.