Time right for young open source companies: Proactum

During the recent Beijing Open Source Camp, I met with senior executives of Proactum, an open source software company from Finland.


While, generally, everybody knows Finland for Nokia, every one from the open source world knows Finland for Linux.

The executives--Proactum chairman Anneli Koivunen, senior partner Jouko Hyppönen and senior advisor Mikko Puhakka--shared their ideas on open source.

Please introduce yourselves and let us know why you created the company, Proactum.
ANNELI KOIVUNEN: I have very wide experience in the infocomm technology (ICT) field and business management. I have also been working as a CEO of a listed company as well as a board member professional. One reason why Proactum was established was because of the different kind of work that Proactum's parent company was doing. The parent company did business consulting and project management, whereas Proactum was doing software development and software projects. Therefore, it was a natural move to establish a software and services company that clearly focuses on providing software and services to the public sector and business markets. At the same time, I saw it as an opportunity to expand the ownership and management structure of Proactum and become a much stronger player in the market.

JOUKO HYPPÖNEN: I totally agree. I came on board when I saw there was room for this type of a company in the market. In addition, the visions and strategy of Proactum matched with my thoughts well. (Jouko has been developing Proactum from its early days, by developing a professional project management culture and customer project skills to the company.)

What are the Proactum's main goals? What is its core value for customers?
KOIVUNEN: Proactum is focused to provide top quality enterprise open source software and services to its customers. The core value is that it can be a very competitive alternative to those companies that are providing solutions around proprietary software. We have seen this as a huge opportunity, since in Europe--and we believe soon in Asia-- public and private sector organizations are using more and more open source software in their business applications. This has been proven by various studies and also in practice.

HYPPÖNEN: The core value, however, is high quality and professional services to customers, who are happy to see there is a new high quality and fast player in the market. Proactum can give a competitive alternative and fresh and innovative view, combined with professional project management skills and top open source products.

What is the philosophy behind the successful Proactum Platform?
HYPPÖNEN: Simply re-use what has already been done; let the customer get the benefits – and of course, apply the advanced technology and create a new way of thinking.

MIKKO PUHAKKA: Simply, the era of open source has arrived for a number of reasons, such as cost, quality and control. We are already witnessing that in Europe and the United States, with Asia catching up fast.

Proactum has acquired Quosis. Can you tell us a little more about that?
KOIVUNEN: This was a strategic move. This way, Proactum could strengthen its open source and technical know-how while its service and business know-how were already in a very good shape. We also got highly skilled staff onboard, and also something that is now been developed towards Proactum Platform. After this acquisition, we were able to grow quickly into a position where we are now. We see this as a beginning of the path where we are going and as a part of our vision to be a big global player.

PUHAKKA: Open source has already proven itself to be a competitive way of producing and distributing technologies, we now just need to add sound business practices on top of that.

What are Proactum's key plans for the next three years?
HYPPÖNEN: We strongly believe that we will be a global player within the next couple of years; our partners and the company itself are playing in the international market in various locations.

PUHAKKA: The market right now has an opening before the incumbents start to get into the game. Whether it will be within three or five years is the big question. In the meantime, it is an opportunity for young companies to establish themselves and position for an exit in either public markets or through acquisition.

Amidst the weakening global economy, China is still growing faster than other countries. What's your view of the business opportunities for open source in China?
HYPPÖNEN: Yes, that is true. The two-digit yearly growth of China's economy may be a one-digit growth in next couple years, but it is still fast. We believe we will see something similar to what has been happening in recent years in the European Union (E.U.)--the business opportunities will grow and the change in the way of thinking about software products and the services proposition will be seen in China just as it has happened in Europe and Finland. No doubt China will be in a very good shape, economically, and that the opportunity may also be seen there while the U.S. and E.U. economies will not grow. In addition, I find that both the Chinese and Finnish are hard working and fast-thinking people.

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Peter Cheng

Peter Cheng is a community strategist and open source evangelist, who is based in Beijing, China. In 2003, he initiated the Open Source University program to gather industry experts and help spread open source technology and culture to over 100 universities. In 2007, he organized the Open Source Camp in five Chinese cities, with the aim to enable the open source community to share and exchange ideas and to promote the technology in China. Peter currently runs TargetSource Tech, a company he founded to provide consulting services on enterprise open source software.