Here is Part 2 of my interview with Paul Grayson, CEO of Alibre. If you haven’t Part 1 you can read it here.
Deelip: I noticed that you issued a press release about the $99 offer a day after you announced it on your blog and let bloggers know about it. There is a view that bloggers do a better job at putting out and analyzing technical information as opposed to the traditional CAD media. But your decision of letting bloggers to be your first line of marketing seems to suggest that they can be useful at spreading news as well. Or am I reading too much into this?
Paul: You are absolutely right – bloggers and other social media outlets are an excellent way to spread the word in addition to analyzing it. It has been a very successful strategy for us.
It is our observation that CAD bloggers have become a primary source of independent news and analysis in the CAD industry. Traditional print media is severely handicapped in the Internet age. Consumers have always turned to the most immediate and most engaged forms of journalism. They want the news and analysis and they want it now.
Deelip: Do you think the “80-20” argument (80% of the functionality for 20% of the price) sits well with prospective customers? What is the 20% that is missing and why does not everyone need it?
Paul: It sits well with many of them. Alibre Design does not offer all the tools of the competition – but that’s who we are and it is intentional. We don’t focus on “everything for everyone”, which invariably translates into “expensive” and “very complex”. We do not offer complex surfacing nor do we support massive assemblies very well. But our customers aren’t trying to make 10,000 part assemblies. Whether or not Alibre Design is a good fit really boils down to what your business makes – our Sales staff is happy to answer questions and will let prospective buyers know if we aren’t a good fit for what they are trying to do.
We don’t believe that we are missing anything that the majority of customers need to get their jobs done.
We believe that most 3D CAD products, including Alibre Design, passed the “80-20” point early in this decade. Now the high priced competitors are engaged in a feature war to justify their prices and to directly battle each other. Alibre is focused on making our software as powerful as possible while also retaining its intuitive ease of use and learning.
Deelip: There is a view that Alibre Design is good for creating “boxy” parts since it lacks good surfacing tools. The images in the Alibre Gallery also seem to suggest that. Do you agree? If yes, is that something that will change?
Paul: “Boxy” connotes a level of simplicity that is not completely accurate. “Prismatic” is probably a better word to describe Alibre’s sweet spot, at the risk of sounding too technical. We have customers using our loft and sweep tools to make some organic parts, but we recognize that if highly organic surfaces are a part of your daily workflow then we are possibly not a good fit for your business. Most mechanical designs do not have excessive surfacing requirements – that’s more in the realm of consumer products and mold design in some cases. Tools dedicated to surfacing above and beyond lofts and sweeps have been on the radar for us, but they do not fit into our immediate plans. Customers using Rhino can import native Rhino surfaces into Alibre Design as the basis for parts.
Deelip: How much importance would you give marketing when it comes to closing a deal, as opposed to getting a prospect to doing a technical due diligence of your product? Do you believe that the mid-range MCAD vendors use their strong marketing as an unfair advantage over Alibre?
Paul: Technical due-diligence is something that every prospect should do when buying any product for their business. It is in fact this very discovery process that makes us attractive to many people when they compare our capabilities to the competition. We want people to evaluate, in detail, what we can and cannot do since this is often to our advantage. We don’t believe other mid-range MCAD vendors have an “unfair” advantage over us in terms of marketing. They use hard-sell tactics and misinformation against each other just as much as they use them against us. It’s just the nature of the industry, unfortunately.
With traditional print media, larger companies can have an advantage because they can more easily afford to pay the advertising rates necessary to get product reviews and good press. However, the Internet is a great leveler of playing fields, which has also been an advantage for Alibre.
Deelip: Who is your number 1 competitor in terms of functionality?
Paul: We are more in competition with the market as a whole than with a particular vendor. All of the competition in this realm is more or less evenly matched.
Deelip: Who is your number 1 competitor in terms of price?
Paul: As with the previous question, it’s really the market as a whole. Their prices are all relatively the same, and then there’s us.
Deelip: What is the Unique Selling Point of Alibre Design?
Paul: Do what you need to do for dramatically less money. Pretty simple.
Deelip: Some people appear to be going to lengths to suggest that Alibre is going down and that this $99 is a last ditch effort to stay afloat. Do you think such utterances are worth addressing? If yes, what would you say to your current and prospective customers to reassure them?
Paul: Alibre is profitable, cash flow positive, debt-free, growing, and has been self-funded since 2001. We don’t think it deserves any more discussion than this. We could keep rebutting the claims, but those that make them are almost invariably anonymous posters that have never used the software. The short end of it is that these people do not have a clue what they are talking about.
I doubt that a couple of things Paul said will go down well with the traditional print media:
“Traditional print media is severely handicapped in the Internet age”.
“With traditional print media, larger companies can have an advantage because they can more easily afford to pay the advertising rates necessary to get product reviews and good press.”
I don’t think Paul could be any more direct than that. Another thing, in a comment to an earlier post on the subject titled “Changing Times for the CAD Media“, SolidWorks employee, Mike Puckett left it up to his PR department to clarify whether my interpretation was right or wrong. They have not done as yet and I don’t think they ever will. Frankly, no level headed PR department would ever respond to that kind of sarcasm. But I get the feeling that I went ahead and said things that they have been itching to say for quite a while now.