Consilia Vektor's Randall Newton, CADalyst magazine editor-in-chiefCyrena Respini-Irwin, Architosh senior associate editor Pete Evans, and upFront.eZine editor Ralph Grabowski interviewed Graebert Gmbh's chief executive officer Wilfried Graebert, chief technical officerRobert Graebert, and head of sales and marketing Cedric Desbordes.
The meeting took place in mid-October at the offices of Graebert Gmbh in Berlin, Germany, the day after the company's annual conference. Here is my transcript of the hour-long interview. It began with introductory statement by Wilfried Graebert.
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Wilfried Graebert: We are in a position where we no longer follow others[such as Autodesk]. We can go our own way. We need to get more visibility in the marketplace, and so that is what we are doing.
We are too small to open everywhere, so we have some strong partners in the US, Canada. It is natural that we do something in India, because we have an office there. In Japan we had a chance to do that [with a local distributor], and so the next logical place is here in Germany. We are recruiting sales people for Germany.
Q: Are you shifting from primarily seeking development partners to seeking sale channels?
A: First of all, visibility. When we say we have a product like other competitors have, there is not too much to explain. But when we shift away [from what everyone else does], then we need to explain.
We have been talking for ten years about mobility [starting with CAD on Windows CE]. You saw [yesterday at the Annual Meeting] that we are putting SiteMaster Kitchen on mobile, because we are able to make money in that area. Everything is not just a free-bee. Corel has said they are going to sell [mobile CAD] separately; it takes some time to bring it to the market.
Everyone said, "We are going to do everything on the cloud," but what that actually means and how that should work for regular customers, is something that needs to be explained.
The more we are visible with the ARES brand, the more we get OEMs [other software vendors who license Graebert's software]. We will stick with our OEMs, with our retail partners that we have, to multiply our forces. We are just a small to medium-size CAD company, yet we by far have more programmers than sales people. This is the reason why we don't have a problem to work with companies like Corel and Dassault, because they have sales channels. We are never in competition with them, because they are talking to different eco systems.
For instance, Corel came to us, and said "We have many downloads through the Android store," and so they want to [start selling mobile on its own]. This is fine. They did not say anything about Kudo, because it is new. So it is something we have to do ourselves: we have to take the lead, to show the value, to see how it works, to see what is possible.
Q: How does Kudo place pressure on your competitors?
A: For us, it is very encouraging. We have always been very innovative. In the past, our competitors spent 90% of the time talking about price. With our Trinity approach, this is changing. People talk about possibilities, and we can ask them how they want to develop their company.
[Trinity is Graebert's three-pronged CAD system: ARES for the desktop, Touch for mobile devices, and Kudo for Web browsers. All share the same code, share some APIs, and share the same drawings. Kudo is becoming also the file hub for all three.]
What does Trinity mean to them, what does it bring to them? The price, sure, is talked about in the end, but the whole discussion has shifted.
The facilities [add-on] guys can bring new offerings to customers; there are new possibilities now. This is what we have seen for a year now, ever since we announced it, we see companies actively approaching us and saying, "Here we have this sort of thing, does it work [with Trinity]? We met with some of your competitors and they couldn't tell us if [their solution] works for us or not." Kudo is real, we can show it, we can demonstrate it. Quite often with the APIs we can convince them that they can customize things for their workflow.
What I like is that the CAD market is kind of drying up. The big guys are buying up [smaller companies], and then they bundle the [products with their own]. There is a concentration in CAD at all levels, whether in CAD software or among verticals.
We can help small companies with that, we can help them revitalize. To survive, they need to differentiate, and they can come to us. They can get our technology and be different. We think many of our competitors will not survive in this concentration. We need to be different to survive long-term.
When the alternatives to AutoCAD are like AutoCAD but cheaper, then the customer will spend all of his time looking for what is missing [from the workalike] for the difference in price.
When instead we show all these new things, he can tell his boss why this is better. He will spend his time looking at what is new, instead of trying to look at what could be missing. This is completely changing the relationship.
Q: Further on the effect on competitors, have you seen changes as a result of your software offerings or in their focus?
A: We see resellers of other AutoCAD alternatives coming to us and saying they are interested in our solution. They come to us, because some of the AutoCAD alternatives have stability issues or reputation issues, because of legal stories that some of you might remember.
If you try to compete just on the price, thinking that AutoCAD LT is e460 a year [US$380] -- of course, we don't compare with LT, because we have many more functions. If you think about the user who needs 2D, the price difference is not so much [from AutoCAD alternatives], so we need to differentiate.
It has been talked to death, but Autodesk's forced migration to subscription is a big story. A lot of companies are getting in touch with us, who are thinking about what they should do next. If Autodesk hadn't forced the issue, their customers wouldn't have considered an alternative, and now they are actively seeking alternatives. They don't want to move along with that change [to subscriptions].
From reactions [to our advances] that we have seen from competitors, I could say we have seen from Autodesk reactions:
- Their mobile version is getting better
- In some markets, they are keeping perpetual licenses, when they had said they would not
- In Japan, they are getting more aggressive in pricing
They are taking some actions to try to counter us, to fight what we are doing.
It seems that their focus is in different areas. The AutoCAD cloud offering has, I think, regressed over the years. Every year it is getting worse. AutoCAD WS was pretty competent, although it was Flash-based, and now the newer version [AutoCAD 360] is losing features. Maybe we will see some new stuff at AU [Autodesk University], but what is out there today is not of the same caliber as our offerings [Kudo].
There is a double perfect timing. One perfect timing is [Autodesk's] transition to subscription model (and for them it is OK that they leave behind some customers who will not transition), which for us is very good.
The second perfect timing is their shift in focus, and they are not investing much that is interesting in AutoCAD currently. They are fighting hard on 3D with Revit and Inventor, and in the meantime, if you look at the new features of AutoCAD and LT, not so much. I mean, over the last several releases they have been emphasizing PDF conversion!
That's the challenge: What is the product vision for a product that has been on the market for 30-35 years? Where do you take it next? They say AutoCAD works well as a development platform as well as a drafting tool, but a lot of the big verticals have obviously migrated away.
We have the vision that it [Trinity, consisting of ARES, Touch, Kudo] is still a great platform, for end users like drafters or engineers, but also for solutions like Onshape or SiteMaster that are built on it. If you are going to use it as a platform, then you have to modernize the platform to work on the desktop, on mobile, as a [Web] client so that you are able to respond to the needs of the new companies coming up.
Q: The first time I heard "MDM," I had to look it up. It does not roll off the lips of the average CAD user.
A: But it rolls off the tongue of the average IT manager!
Q: When you say you are going to support Mobile Device Management, is there a set of protocols or standards out there, is there a product that you have to work with?
A: MDM is a class of products. When you go work for a large company, they typically give you a phone or a laptop, and they provision [install and configure] software on it. It is a way of installing a set of apps on your phone with a standard set of settings.
The work we have done is to better understand the requirements of enterprise users. First, they have to do this step of deploying the application. They realized that they don't want employees to have to log in -- that's too complicated -- they just want the app to work. They might have a corporate policy of using only one of the cloud providers, so they have the ability to remove the other ones [from the apps].
So we added some configuration settings [for MDM]. They still use ARES Touch, but a slightly different configured version that works in their environment, and this MDM mechanism is just a way for them to install it on all their devices. Microsoft, Google, and Apple have ways to save and read the settings; there are about ten different [MDM] products in common use.
The administrator can say, "I want these apps installed on these devices." MDM also allows the device to be wiped remotely, and it disables accounts that individuals might be used to using. It gives control over versioning, so managers can push updates at their own pace. We can limit the number of features exposed in Touch, should large accounts want this.
Q: Does Kudo support multiple accounts?
A: Yes. although MDM is interesting only to very large accounts. We work with consultants and individual architects who need access to many Google or Dropbox accounts. Kudo supports multiple cloud accounts.
Q: Does Kudo have file or size limitations?
A: This is something we are working on. You will find every three weeks that Kudo opens more kinds of files and opens them faster. There are still limitations; we keep chipping away at it. We are not yet at the state where you can open a 100MB drawing and have it work great.
We recently we made block-heavy drawings perform better, similarly for hatches. We first emphasized Onshape-type drawings, as they are structured in a specific way. Understanding how the drawings work makes us better. As we roll out Kudo for general-purpose editing, we have to handle any kind of file.
We warn you up front when a file is pretty large and it might take some time to open. If you say "Yes," then if it loads well, then performance will be great, because once the file is loaded, things like highlighting and so on are done fully client-side.
I have sent you three view-only links to files. You have nothing to install, just click, and then you can see for yourself the speed.
We are not optimizing for viewing. If we were building just a viewer, we would use some pre-cached format of the DWG data that's easier to stream down. There are a few things we can do if we were building just a viewer. A viewer is valuable enough, but not for us; we are not going to build something completely separate. Our viewer is a subset of the editor. Fundamentally Kudo is an editor.
Another idea behind Kudo is that you use it on a computer where ARES is not installed. You still do the heavy work with ARES Commander. Installing ARES would take longer than waiting a minute for Kudo to open the file [than ARES for desktop]. For me, waiting five minutes is frustrating, but one minute is OK.
I don't think we anticipated building viewers. There is no market for viewers; on mobile it is hard to make money from viewers. There are companies that make a living from viewers, but for us we work with one format, basically [DWG]. When you go into the viewing market, there are dozens of formats. [Most viewers say they support 200 or more file formats.] We wanted to support just DWG, but then we were asked, why not also Revit, Microstation, PDF? It is logical that at least you can view them.
Q: You are supporting references, including images, in Kudo?
A: If a drawing references other DWG files, images -- which is common, particularly as we have that PictureNote feature -- those will render fine. The thing to make sure is that when the [DWG] file is synchronized, that the picture [image] follows.
There is one thing that we haven't done yet [for Kudo]: some users need very large black-white TIFF files. We support those on desktop and mobile, but we haven't really pursued that with Kudo yet. It is not hard to do; a 5000x5000 [-resolution] or a 10000x10000 TIFF image just requires a different kind of processing [because it cannot be easily streamed]. You see it used in the mapping space, such as aerial photos. But normal-size photos work as expected.
[Here there was some discussion of how Graebert works with ESRI on ARES Map. At the end of the day, they didn't sign an OEM contract, they signed a marketing contract. "CAD is a completely alien topic for a lot of maps people; they went to GIS to get rid of CAD."]
Q: Can you use ARES Map to get at contour layers, and pull that vector information straight into the drawing?
A: ARES Map is a CAD editor to Esri services. The answer is, sure, if it is a service provided by Esri . All the processing is done on the GIS side; Map today cannot do this, but we could add survey import tools. Esri might charge for accessing the data.
Q: How did ARES Sketch come about?
A: ARES Sketch came out of our conversations [with ESRI users], where they were saying, "We need a new sketching method. What we have today is quite proprietary and old. Can you help us with that?" [Sketch is for drawing and dimensioning floor plans to determine property taxes.]
We looked at it from a CAD perspective, and thought, "This is super simple." To give you an idea of the market potential of ARES Sketch, there are 3,200-something counties in the US. We calculated that if we begin with just 50 of them a year, that would be already $200,000 - $300,000 for us. So you see the market is potentially huge, because each county has dozens of employees that would use it.
It's early for us, and we are working very closely with the camera vendor that approached us about the idea. We could have created an OEM product, but we realized that the market is larger than the one vendor. We decided to use the Graebert brand so that we can then use it as a launching point to attack the market more broadly.
The $995 price is more of a placeholder. It will probably ship in December.
Q: During the conference yesterday, you said "Adapt to a business model, rather than enforce a software solution." What did you mean by that?
A: I was talking about how we create a price for ARES OEM [which has no published price list]. When we meet a potential partner, we simply adapt our pricing to their business model. There is no fixed price initially for ARES OEM. In the end, they will be the ones selling it; if they don't succeed, we don't succeed. If they succeed, we want to part of the success in some shape or form.
When I have a conversation with a new client, they ask, "How much does it cost?" And I say, "It depends." It could take two weeks before we give them a price, because we ask so many questions to understand what they do; sometimes they don't have a very accurate idea what they want.
This is working well for large companies. But when we talk to small developers, typically a partner who is selling 100 seats a year, who is focused on one country, in a niche market, for them the process seems quite opaque. It looks in some aspects quite frightening to them, because it looks like there is a hammer coming afterwards.
Also, if you go to our Web site, there is no price, and so you go, "Well...". There are no leads coming when people see no price. We can see how many people visit our development Web page, and so we know how many have not contacted us for an offer, and there is a big gap.
In the end, [the new stripped-down "Powered by ARES" OEM version] shows an entry price, the way to do something cost-effectively. And then later, depending on their needs, we might discuss something else. But at least there is already a first price shown.
Q: Does this change the way you support customers?
A: The majority of our support today goes into supporting our OEM customers. But as we grow the number of [direct] customers and increase our marketing and sales channels, we are getting feedback from them that is helping us shape the product.
We got a lot of high-quality feedback from our Japanese sales force over the last 18 months. That has driven the quality of [ARES] 2018 quite significantly.
We are open to receiving feedback to shift the product going forward. Before it was really quite easy. I could just sit down with the largest partners and have a conversation around what is important to them, what we have planned, and what makes sense to do next. But now we want to include more people that might represent a different demographic of our user base.
Now they are more frequently asking us what makes more sense for them! One saying in customer-driven development is, "If you don't tell us what you need, we will figure it out." Sometimes they look to us to give them direction, and so we say to them, "This is what we think is the next important thing." We got a lot of position feedback from our partners, saying "Great, that makes sense."
We need to walk on two legs, helping each other. We showed a couple of verticals yesterday. It is important to understand that a larger majority of our engineering efforts are on the main [ARES] products. Each one of the verticals has a small engineering team. Only when they become large, like SiteMaster has, do they get a dedicated sales and support and engineering teams. The other ones, you could say we are incubating them.
ARES Mechanical, for example, we first presented two years ago. It has taken some time, but this year we saw the first successes, and so we will keep pushing it a bit further, and see how much more we put into it. Like with ARES Map and Sketch, this is generating opportunities.
Q: When other CAD companies do something cloud-ish, it starts to look like PDM, product data management, here's where the files are. Bricsys has a system for it; Onshape has whole system built in; Autodesk has three or four options; there are others. Is this because it is the easier approach? Did you decide that you didn't need to do it that way?
A: It is not our expertise, we are better at graphical software. I would much rather be the partners to all those PDM guys. There is no need to reinvent the wheel. There are interesting things you can do with PDM, but it is not a problem we want to work on. It does not make sense for Kudo to do PLM. We offer a solution that integrates with them.
We created a hub for Kudo where you can connect all the storages [like cloud services] and search them all. This is the most minimal thing we can do to: browse folders and click on files. Yes, we are going to put more into it. We are going to have thumbnails, have a search engine, more workflows around sharing, but we don't have an intention to building a data management solution.
There is no value in re-inventing the wheel when you see companies like Trimble Connect and Onshape. We work with these guys, instead of trying to enforce one more. This comes from our history, where we see who is the leader in the industry, and then we talk to them and see what they say about our offerings.
There are interesting things you can do with PDM/PLM and centralized storage, but it just isn't a problem we want to think a lot about at this point, at our size. There are very small functions we will enable so that people can do some things with them.
What I mean by this, in the SiteMaster application for doing kitchen surveys, you end up having a couple of surveyors out there, and you have these jobs that you schedule -- Kudo will not do that for you. But I have no problem enabling you to store data in Kudo, like data about the file, like what project it belongs to. I don't think it makes sense to go to Kudo to do project lifecycle stuff.
It is more valuable to us to offer integrations with PLM solutions (that already have their own users and communities), than it is for us to start something new from the top. We have to pick our battles.
www.graebert.com
[Disclosure: Graebert Gmbh contributed towards my airfare, accommodation, and meals]
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Correction to your 1.5M DWG files in Dropbox: https://techcrunch.comreports that “These products are long overdue given that Dropbox’s Ross Piper, who is head of ecosystem and developer platforms, says they have 1.5 billion[with a B] Autodesk files stored in Dropbox with 85 million being added every month”
- Dale Bartlett, CAD-BIM system manager
ATKINS, Dubai, UAE
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Steve Johnson (@SteveJohnsonCAD): "*Johnson"
UPFRONT.EZINE (@upFronteZine) Replying to @SteveJohnsonCAD: "I will allow you one misspelling of my name."
Steve Johnson (@SteveJohnsonCAD): Replying to @upFronteZine: "I don't expect to need it. :) "
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"In fact a lot of users don't even want feature updates. Once they've learnt how to operate it, they get grumpy when the software and UI changes."
- I ain't Spartacus, commenter on The Register
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