Duke philosophy grad turns to logic to nurture his file-sharing startup.
RALEIGH – Jesse Lipson’s phone has been ringing a lot lately.
Since the company made Inc. magazine’s list of the nation’s 500 fastest growing private companies, a number of venture capital firms have called, looking to invest in Lipson’s Raleigh software company, ShareFile.
He declines the requests.
Lipson says his graduation from Duke University in 2000 came during the dot-com collapse, and he learned a lesson that’s led him to resist turning to venture capital. “I saw a lot of VC-backed companies crash and burn,” he says. “I wanted to bootstrap the company.”
ShareFile has grown to more than $4.3 million in annual revenue by serving customers throughout the country and around the world.
The company provides a way for businesses to manage files electronically, either by transferring them or by creating a secure area where those files can be viewed by others in the company or by the company’s clients. All of this is done over the Internet in what has come to be called “cloud computing.”
Cloud computing wasn’t a common term when ShareFile started in 2005. Lipson, a self-taught computer programmer, started out by building web pages for businesses.
While working with small businesses, he says, he realized that companies needed better ways to manage documents. Technology industry analysts call this field “managed file transfer.” Research firm Gartner has estimated that the market for these vendors is more than $450 million served by up to 45 vendors. Maureen Fleming, program vice president for IDC’s business process management and middleware research area, notes that the market for these services has grown.
“There is a fundamental need present for this type of software, particularly where there is a need to send and receive files across firewalls,” she says in an IDC report.
ShareFile’s clients include financial institutions, pharmaceutical companies, law firms and graphic design firms. Raleigh graphic design and advertising firm Generate Design was one of ShareFile’s earliest customers. Paul Barth, partner in the firm, says that before ShareFile the company sent files to clients either by e-mail or by courier. Courier costs can quickly get expensive, and e-mail is just not feasible for large files.
“Anything above 10 or 20 megabytes you can’t send through e-mail,” he says.
Generate Design uses ShareFile to create a secure online area for clients to view files. Barth says the area has the same look as Generate Design’s own website.
Lipson says ShareFile is making an effort to grow abroad. The company has started to add data centers overseas to serve new customers.
He notes that while a data center can serve customers anywhere, some regions, such as the European Union, require data centers handling regulatory documents to be physically located within Europe. That’s why the company opened a data center in Ireland. ShareFile also has a data center in Singapore to serve customers in Asia.
These growth plans aren’t what Lipson had in mind when he graduated from Duke with a philosophy degree. He had studied philosophy, intending to become a philosophy professor. He says philosophy probably helped him become a better programmer because it’s rooted in logic, which is a useful way of thinking for programming. But he says philosophy also helps in the business world. Approaching problems from an outside perspective is appropriate thinking for the business world.
“I think that’s what being an entrepreneur is,” he says.