In his new role, Libin said he will turn to working day-to-day on the product. One big priority, he said, will be to build new features — and even a new line of products — aimed at workplace collaboration. "If there is one thing I wish we would have done sooner is taking the collaborative uses case for Evernote much more seriously," he said. "We've been working on it a lot recently but I wish we would have done it three years earlier."
Libin also hinted at a new product in development. He described it only as an "adjacent product," that would coexist with its current application. "It has a codename," he said, "but I won't tell you what it is."
If workplace collaboration is to be a strategic priority, then Evernote will be entering a crowded marketplace, and doing it rather late. Its rivals will by no stretch of argument include young cloud companies like Dropbox and Box, but also Microsoft's OneNote, to name only a few.
But when you compare its numbers, Evernote sits squarely between Dropbox and Box. It has more than four times the number of individual registered users as Box has (37 million as of last quarter) but about less than half as many businesses signed up as Box (47,000). Compared to Dropbox, Evernote has roughly a third as many individuals as Dropbox (400 million) and about one-fifth the number of business customers (Dropbox had 100,000).
But opposite those rivals, Evernote has grown its user base almost entirely by word of mouth. Where Box in particular was criticized for spending lavishly on aggressive sales and marketing efforts, Evernote spends almost nothing comparatively. "Almost all of our spending is on the product," Libin said. "We can probably afford to do things more like Box without getting into any danger. We have a sales team of about four people. We should probably have a couple hundred. But I don't understand sales. Chris does."
Sales is one fundamental business problem at Evernote. The other is one that Box and Dropbox would recognize: Converting free users to paid users. That job has fallen to COO Linda Kozlowski, an Alibaba veteran, who led an effort to analyze pricing of Evernote's paid services. Evernote initially offered a free service, and a paid service with more storage and features for $45 a year. This year it added a mid-tier service called Evernote Plus for $25 a year. The price of Premium rose to $50 a year.
The company also reviewed pricing in every country in which it operates. "A $50 purchase is a bigger deal in India or China or Brazil," Kozlowski said. "We wanted the price to reflect a more reasonable purchase given the country's economy and scale." Growth of paid users in those countries has since spiked: Paid users in China rose 156 percent; in Brazil, 137 percent. And while the company declined to break out the precise mix of paid versus free users, Kozlowski said that globally the number of people paying for Evernote has grown by 60 percent year on year. And that improvement is not off a low base: More than 20 of Evernote's international markets have more than one million individual users.
Kozlowski was named COO two months ago, as part of the new management team responsible for what Libin says is "taking it to the next level." In March the company tapped Jeff Shotts, a former finance executive at eBay, as its CFO. These execs along with Dave Engberg, Evernote's longtime CTO, have largely taken over the company's day-to-day operations. O'Neill, he says, is the last piece of that puzzle.
—By Arik Hesseldahl, Re/code.net.
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