Microsoft May Buy Email Startup Xobni
Michael Arrington
46 comments »
Microsoft has been in acquisition discussions with email startup Xobni, we’ve confirmed through multiple sources. The company, which launched at the TechCrunch40 conference last year, currently offers an outlook plugin for Windows users that significantly improves the desktop email experience (particularly search).
Microsoft may have first approached the company months ago and floated an offer of sub $20 million, which was apparently rejected. But the company, which recently hired notable Yahoo’er Jeff Bonforte as CEO, is now back at the table with Microsoft corporate development.
Xobni currently only works with Outlook, although the company has said they will extend to integrate with other email clients, instant messaging applications, and social networks in the future. The current product creates an information profile for each person you interact with, and surfaces historical information that is relevant to what you are working on. Xobni displays contact information, threaded conversations, attachments, related people, email usage statistics, and information from the web. See our post from January with a more detailed overview of the service.
The company was founded in 2006 by Adam Smith and Matt Brezina, with early funding from Y Combinator. Other investors include Khosla Ventures, First Round Capital, Ron Conway and Baseline Ventures, Atomico Investments, Paul Buchheit, Ariel Poler, Saar Gur, and Tom Pinckney.
Xobni has not yet responded to our request for comment.
Update: Zoli Erdos points out that Bill Gates loves Zobni:
LOL, I can’t believe the crunchbase listing for xobni has to specify that it’s inbox spelled backwards.
I have been using Xobni for the past 5-6 months and I have a love, hate feeling for it….the days that it works, its great and the times that it doesnt work and it slows the hell out of my outlook, all i wanna do is break my laptop….it will be interesting to see if they could scale the application and add more features.
Good thing they did… I didn’t realize it!!!
Mike –
It’s not like this is a surprise - these guys are clever and have a great product with clever marketing — How could M$ resist?
Marcus
UserVoice.com
I use the app, and I like it. Having said that, I don’t see anything about it I would pay for, or maybe even be willing to put up with ads in a sidebar for. As a free module in Outlook from Microsoft though? Pure win.
I use Xobni but it does slow down my XP laptop so I hope Microsoft speeds it up and that it’s a free addon in the future!
Does anybody know what their revenue model is? Does one even exist?
$20MM for a company that has no revenue and sells a silly social plugin?! Bubble!
Outlook 2007 > xobni. Done.
Sub 20MM, I’d say 1MM for this.
That would be bad for Xobni in my mind because they are working on cross-platform apps (it is supposed to work on Outlook, Apple Mail, and Thunderbird) all mail platforms. If Microsoft was to come in, then that wouldn’t happen, they would just allow it to work on Microsoft products! Which would SUCK!
I signed up and used it for a couple of weeks, but I had serious problems with. The major one was that it wouldn’t display when Outlook 2007 was opened just after a restart. I would of had to close Outlook and then reopen it to actually see it.
Also I absolutely hated the fact that it kept its own address book and wasn’t synchronized with Outlook’s.
And then worst of all, it was just another pane added to already several frames that is already there by default. I hate it how my Outlook looks like it’s all patched up, and I have to refer to somewhere else just to see some extended info that could have easily been displayed right where it supposed be. What I mean is that a lot more integration is what it’s really needed, but I don’t really blame them as you can’t really do better with current Outlook Plug-in architecture, so seeing it being acquired by Microsoft will at least be a step towards this needed integration.
What a waste of $ unless the acquisition is really just a signing bonus to get a good team.
take the money and run
Omg … Please, NO! Find anybody but not an owner of an application that’s targeted by Xobni. (Like Microsoft) They’d take the technology, integrate it with their product and stop all attempts that would integrate it with other applications.
So: Please, NO!
There is a business model around that project, so stop talking to Microsoft or any other company you target!
are investors running away with whathever they can get out of a plug-in investment? 4m+>? for a MS outlook plug-in?! sounds like a good move..
Will M$ know what to do with these kids? They look like a fun bunch - they’ll get gobbled up in the bureaucracy of a huge corporation, won’t they?
marcus
Xobni already raised too much money to make a 20M acquisition feel acceptable to everyone… they’re in too deep to take the money and run.
Awesome. It makes complete sense. Microsoft would be wise to continue on with plans to support other email clients. The data is really valuable, even if anonymous.
Those comments that don’t see the value confuse me. No value in a plugin for a tool that tens of millions of people use that actually saves them time, money, and grief? Consider it also as an entry in the bottom-up new wave of social networks — where apps that people already use connect users to each other. Very smart.
“What a waste of $ unless the acquisition is really just a signing bonus to get a good team.”
I think this comment is spot on. If they were interested in the product alone, they would just rip it. If this is true, it’s because they want the team to help build and expand Xobni-like functionality after it’s integrated into Outlook 2010…
personally, i think xobni is unnecessary eye candy slowing down an already slow enough email client. don’t get me wrong, email analytics is interesting … once in a while. i don’t really need to know that i send my boss 2 emails an hour every time i open his thread esp. at the cost of my computer’s memory. the only value i see here is the search, but you can already get that with lookout, google desktop, etc. i just want email to be lighter and cleaner (less spam), with kickass search and labeling features (like gmail …). congrats to xobni for getting a bid, but i say take the money and let this product go. you know once your email plugin starts to look like winamp that you’re just forcing it
i can’t think of another company besides microsoft being interested in this anyway … maybe they realize no one has written a windows application for years and want to promote their platform, even though the web has *clearly* won already. just being honest, all the best to xobni.
Maybe MSFT will combine Xobni with the acquisition of a large social network, such as Plaxo…
@21
“maybe they realize no one has written a windows application for years and want to promote their platform, even though the web has *clearly* won already”
I kind of agree with you here. I’m sure MS would want to morph outlook into a product that is not merely a mail client but a gateway to the online social networking portals and such. In fact I can see a faint dotted line between this and the news that Bill Gates will answer questions on Linkedin (which was circulating a few days ago). So even if Xobni do not necessarily add any massive value to Outlook they may want to show the world that developers who create plugins for outlook can potentially earn a decent payout…
This is ABSURD. This is everything that is wrong with venture investing.
The product has no revenue. No path to revenue. No defensible technology. No massive reach. They are 100% reliant on Microsoft to allow them to continue inter-operating with Outlook.
Someone, please, explain?
None of the arguments above come close to justifying a $20m valuation.
I just hope it doesn’t suffer the same fate as Lookout.
I don’t know if you can justify the cost, but it does look like a nice tool. I am always looking for a photograph I sent or a phone number I did not save…
MSFT should acquire Plaxo and integrate it with Xob…
Haha the Y-Combinator rumor mill at it again. They managed to pull one Rick Roll on all of us with Reddit and now Paul Graham is at it again with Xobni.
MSFT will probably buy it because they do this all the time. It’s not that they couldn’t actually herald the engineering resources to do it, it’s just easier to acquire something that’s out there. That being said, what’s the need for Xobni? Wait, there is none. That’s the signature of Y-Combinator companies - they solve non-existent problems.
Again with the TC usage of “surface”… It’s an intransitive verb fer chrissakes. Can’t you speak proper English?
It kinda looked obvious after the Bill Gates demo
The best thing about Xobni is not the search, it’s the list of recent files exchanged with the contact. I use that almost every day
Doesn’t Plaxo have a similar plugin? And I’ve got to assume Plaxo has a much bigger user base. Between the Plaxo and LinkedIn pluggins, I’m tentative to install another.