New technology creates bridge to old information
by Kris Vera
Medill News Service
May 04, 2004
Daily Herald
OctetString Inc. is a no-nonsense software company.
Located in Schaumburg, it has developed ground-breaking technology that helps businesses expand their operations and their workforces efficiently without replacing their computers and networks.
According to Clayton Donley, the company’s founder and chief technology officer, OctetString is helping giants like Motorola Inc. and Boeing Co. solve real problems such as managing and accessing employee information from incompatible computer systems.
“We’re not here to make the next iPod,” Donley said. “You can create lots of gee-whiz technologies. But if you’re not fitting into somebody’s needs, then you’re just wasting your time.”
OctetString, founded in 2000 and located in the Woodfield Preserve Office Center on Martingale Road, booked revenue of more than $1.5 million last year, and just completed the most profitable quarter in the company’s brief history. Also during the quarter, the Commonwealth of Pennsylvania and the National Insurance Administration of Norway signed licensing agreements for OctetString’s leading product called Virtual Directory Engine (VDE).
As corporations expand and become more complex, employee records and other user information is stored on a growing number of applications and databases. Often times, companies invested in database technology in which the software did not know how to communicate with others in order to retrieve requested information. OctetString’s VDE Suite provides a virtual application layer that allows these different machines to access this information as if it resided in one location.
The product is in demand. OctetString expects 2004 revenue to double to more than $3 million.
“We consider that to be a pretty conservative number,” Donley said.
Bob Dirkes, a marketing consultant for OctetString, said he was impressed with the company’s focus and mature attitude.
“Not to pick on the dot-com era, but many times we had this image of a software company with a bunch of guys in their twenties, getting together and saying, let’s play company,” Dirkes said. “That’s definitely not my impression of this company.”
Gerry Gebel, an analyst with the research and advisory firm Burton Group, said OctetString’s VDE Suite provides a lot of flexibility to corporations and their networks. In order to stay successful, Gebel said OctetString needs to continue educating people about VDE technology and the other ways it could be applied to computer directories and internet portals.
“OctetString needs to get more exposure and continue to get more key accounts,” Gebel said. “It needs to raise awareness in the industry about the capabilities of its product.”
Donley started the company four years ago with an idea about an application that could access data between different types of computers, regardless of its operating system or technical standards. After brainstorming with colleagues over e-mail, he came up with the idea of naming the company after a technical definition.
“A byte is eight bits and an octet is eight,” Donley said. “A string is any sequence of letters or numbers. So OctetString is a sequence of letters and numbers made up of eight bits.”
The company’s main source of revenue is its VDE Suite. Donley first worked on this application as an open-source project in which other developers had access to the code and the opportunity to customize it. Through an e-mail list, the developers discussed how it worked and what it could be used for.
It took Donley nine months to produce a marketable version of his open source project.
“We only had $10,000 put into this thing and we didn’t exactly have a million-dollar marketing project,” Donley said. “Fortunately for us, there was a mailing list related to the open source project.”
Within 24 hours of posting the e-mail, Donley got a call from his first client for the VDE Suite., Bea Systems Inc. in San Jose, Calif.
The online open source community was not only a starting place for OctetString clients, it is also a place to recruit new talent.
Marc Boorshtein, then a student at Western New England College, found out about OctetString after he posted his directory-related project to the open source community. OctetString offered to pay him for this project. After graduation, Boorshtein left his consultant position with PricewaterhouseCoopers LLP in Boston and moved to Schaumburg for a programming job with OctetString
“I like the freedom you get when working at a small company and the camaraderie,” Boorshtein said. “You don’t have to go through 50 managers to get a decision on what you’re going to get for lunch.”
The company focused on recruiting programmers with experience working on computer issues for big companies.
“You can’t just have only people who are 22 and have no experience with these enterprise companies, putting together software these people can use straight out of the box,” Donley said. “So, one big focus we had was to not make this a sweatshop for recent college grads, who work 24 hours a day. Then you buy them a ping pong table and that’s what they work for.”
OctetString will release a new version of the VDE suite this summer. Customers will be able to test out the new version in September, at the company’s first annual users conference in Chicago.
BUSINESS PROFILE
Name: OctetString Inc.
Business: software applications for virtual directory technology
Headquarters: Schaumburg
Founder and Chief Technology Officer: Clayton Donley
Residence: Palatine
Founded: 2000
Revenue in 2003: more than $1.5 million
Web site: http://octetstring.com