Online project management software enables businesses to share and collaborate with clients and vendors in addition to employees. Companies using project management software can provide their clients with usernames and passwords giving them access to project files. Clients can give feedback, make edits and review progress. There are two main parts to online project management software. The first part involves the management of projects—calendars, milestones, tasks, and to do lists. The second part involves online communication between team members, freelancers, and vendors through whiteboards, forums, chat and messaging systems.
WorkZone is one company that brings all aspects of online project management together into one easy-to-use, web-based project management and document collaboration tool. WorkZone is a privately-owned company based in suburban Philadelphia. The company’s software has been up and running continuously since 2000. WorkZone is one of the most mature and battle-tested web-based project management software packages available on the market today.
Accessible from any web browser, on PCs or Macs, WorkZone is cloud-based project management software, hosted on the company’s secure servers, where your information is backed up continuously. Over 50,000 business professionals around the world use WorkZone currently. WorkZone is used by companies of all sizes, from small ad agencies to mid-sized manufacturers to global organizations like Wells Fargo, McCann Erickson, Wal-Mart, E*TRADE and Subway.
WorkZone operates in many different industries and across many different functions, including advertising agencies, marketing departments, colleges and universities, new product development, healthcare, building trades, consulting and financial services.
I recently sat down with WorkZone President and CEO Rick Mosenkis to gain a better understanding of how WorkZone operates, the market outlook, and what is in store for the future.
Give us an overview of your background, education, and early career experiences. How did you get started with WorkZone, and what is your role with the company?
I attended Princeton for my undergraduate studies and graduated in 1985. I earned my MBA from Wharton School of Business in 1990. Shortly thereafter, I started my career as a strategy consultant with the Boston Consulting Group, where I helped advise Fortune 500 companies on business strategy. Though I still consider myself first and foremost a strategist, I decided a while back that consulting was a bit too hands-off for me.
Starting in 1995 (just as the web was in its infancy), I joined my first web-based-software company, Infonautics as the Director of their Education Division, developing and selling online database software to schools and public libraries. I grew a division from scratch to about $10 million annually in sales in about three years. Though I’m good at creating and growing new ventures, I learned at Infonautics that I’m not a great manager (we had 50+ salespeople in my group), nor is it something I enjoy. So, I left Infonautics and joined another b2b internet company, VerticalNet, just before it went public (in 1999) as Senior Director of Strategy and later Vice President of the E-Commerce Products Group.
VerticalNet went public, and for a short-time was one of the high-fliers of the first dot.com period, rising to a valuation of more than $12 billion. Sensing the craziness of the valuation (and the lack of true business strategy behind it), I left VerticalNet after about 2 years, just before the market (and VerticalNet) crashed. Fortunate in my timing of selling my inflated VerticalNet stock, I went into semi-retirement for about nine months, learning to build furniture and spending time with my family. I got bored and decided I wanted to start my own business, without venture funding, having seen how the “grow big fast” mentality could get in the way of creating real business value.
I started WorkZone in 2002 with co-founder Allan Kalish. Allan had previously run one of the largest advertising agencies in Philadelphia. WorkZone started as web-based collaboration software for ad agencies to share their work securely. Over the last ten years, we’ve grown into being the more full-featured project management software that we are today.
I’m the President and CEO of WorkZone. I oversee all aspects of the company, and play a very hands-on role on the product development and marketing fronts.
Please explain your pricing model. Does pricing depend on the size of the company, the number of users, etc.?
WorkZone is priced as a monthly subscription, based on the number of users who are using the tool.
Which business segments generates the most revenue?
One of the more enjoyable aspects of the business is the wide range of industries we serve; there’s always something new to learn. That being said, we have particular strength among marketing departments of larger companies, ad agencies, and consulting firms.
In which business segment do you see the most opportunity for growth?
We’re seeing growth across all segments of our business, but a particularly strong interest among marketing departments and colleges and universities.
Logistics giants Wal-Mart and Subway recently signed on to using WorkZone instead of Microsoft Project. What prompted that change?
The change was spurred by two new features in the platform, namely Workload Reports, which show which employees are most burdened under various, realistic scenarios, and the task-dependency feature, which can show where pressure points lie along the work-process chain. These are big problem-solvers for process driven, expansive organizations like Subway and Wal-Mart.
What companies do you consider to be primary competitors?
While there are hundreds of other project management software companies out there, we still compete most often against more basic tools like Excel, Outlook or pen and paper. When we do compete against other project management firms, we most commonly are compared to Basecamp (on the low end) and Microsoft Project (on the high end).
How do you differentiate your service from competitors of similar size? What, if any pricing advantages do you have over your competitors? If yes, how are you able to offer those price advantages?
Most project management tools are on the simpler end of the spectrum, more like on-line todo lists than robust project management tools. Basecamp is the most popular of these, and is an excellent product, for those whose project management needs are basic. For those with more involved projects, where laying out projects into subtasks and noting interrelationships between steps is important, we most frequently compete with Microsoft Project. Microsoft Project for a long time has been considered the “gold standard” of project management software, but it’s very complex to learn and use.
For our customers, WorkZone provides an outstanding value, though we are priced considerably higher than lower-end tools like Basecamp. WorkZone’s ability to bring together diverse teams to more effectively manage projects makes it worth the additional investment as compared to less expensive tools.
Does the company have any cash flow from financing activities? Any outstanding loans? What is the company’s total debt, if any?
We are private funded and profitable. We have no debt.
Are you planning an IPO? If so, when? How much capital do you anticipate raising?
We have no current plans for an IPO, as we’re happy providing a great product to our our current and future customers without the constraints of satisfying the short-term demands of the market. We also don’t have a real need for funding in the near future.
How big do you think the web-based project management/document collaboration market will be in terms of total revenue in 2015? 2020?
My guess would be around $500 million by 2020.
I see you have a great website (in terms of an advertising tool). What other forms of marketing/advertising do you use to attract clients? Which methods are most useful?
We’ve had great success with using the web to generate business, as well as word of mouth and direct outreach to prospective customers, cold calling, etc.
What is your strategy for growth? (increased marketing, additions in workforce, etc?)
Growth in marketing dollars and staff are symbiotic; each enhances the other. We are currently adding in both areas.
Is there any other information/new announcements/upcoming projects that are important for us to know about?
We’ll be announcing a major upgrade of the software before the end of the year, designed to dramatically increase the speed of WorkZone, particularly for our larger customers.
Great Rick! Thank you for your time, and best of luck to you and your business in the future! You can find more information regarding WorkZone at www.workzone.com, on Facebook at www.facebook.com/WorkZone, and on Twitter at twitter.com/workzone.