I Was Just Thinking…

Kuali/ KualiCo Update: One Year and a Cloud of Dust

The Dust Bowl was the name given to the Great Plains region devastated by drought in 1930s depression-ridden America. When drought struck in the 1930s the arid grasslands which had been broken out for farming no longer had a strong root system as an anchor. The winds easily picked up the loose topsoil and swirled it into dense dust clouds, called “dusters”, “rollers” or “black blizzards.” Recurring dust storms wreaked havoc, choking cattle and pasture lands and driving 60 percent of the population from the region.  Dust during the storms cause eyes to burn, housewives hung wet bedsheets over windows and doors to try and keep the dust out, and many people actually died of dust pneumonia. There came a time when people knew another storm, like the one below, was coming and it was just time to pack up and leave.

I ended my first blog about the Kuali change to a commercial entity a year ago by stating “Buyer Beware” in reference to the change. Not because I don’t think the higher ed market needs more choices in the ERP space, but rather because the process which occured to get from to KualiCo was just sleazy.    A happy community contributing toward a common goal of creating “higher ed software by higher ed” transformed quickly into extreme paralysis.
With that and my feeling that “Buyer Beware” is still the appropriate approach to the Kualico effort, let’s review some of the things that have happened with the new KualiCo as described by their blog, news page and the Kuali Foundation web site.
November 2014 – April 2015 …. not much
April 20, 2015 … new Kuali.Co offices!  HP started in a garage, Apple started in a garage, Google started in a garage. KualiCo started in brand new offices funded with other people’s money. When a startups highlight news is about their grand new offices instead of focusing on product, clients and results, you have to worry.
April 2015 – June 2015 … Conversations about culture and cloud.
A June 11, 2015 blog provided an overview of progress on various issues.  One that was interesting to me is the discussion of Rice.  As I recall from various discussions I thought Rice was dead. The October 16, 2104 Kuali 2.0 update states,

Project dependence on Rice should and likely will start to decrease over time.

However in the KualiCo post it states,

Great things are happening with Rice!
Kuali rice

Interestingly, I recently was informed that Rice project board stalwarts Cornell, UC Davis and Colorado State University had departed.  This is a far different story than what is listed in the blog above.
Another portion of that June 2015 blog briefly discusses the student project, which brings us to July 2015. More than once, July 1, 2015 was referenced by Joel Dehlin, the foundation board and other observers as the target date for delivering the first module of the new student system: Curriculum Management.
Curriculum Management missed its July 1 advertised availability and continues to use the original Kuali Java code with only an improved presentation layer (based on their AACRAO roundtable as reported by anonymous attendees). There were no slides or other published materials available from the roundtable.
Many people who pushed the pause button indicated that if KualiCo had not delivered Curriculum Management by that date, then KualiCo is “dead”.  As of this post, 24th of August, 2015, there has been no new Curriculum Management module or any other news about it for that matter.  Kualico failed the most important test.  I wonder what University of Maryland executives are thinking now since UMD took a leap of faith and wrote a $500,000 check to KualiCo for the “new” student system.
Meanwhile, Boston College is moving full speed ahead as they leveraged all the previous work that was done on the $40 million student project that was abandoned by the Kuali Foundation. Boston College is making great progress, as can be seen in this blog by Norm Wright, the software architect on that project.  In that blog, Norm writes:

First of all Kuali Student has been branded on campus as “EagleApps.” The primary goal is to create a system that will work for BC now and for a long time to come. A secondary goal is to provide a stable platform that other like minded institutions will be able use to implement their own solutions if appropriate.  As such the BC effort continues to identify likely configuration points and when done they will release the source code under an appropriate open source license.

The comments section of Norm’s  blog indicate that the University of Washington made a similar decision to continue leveraging the original Kuali Student software and not pay attention to KualiCo.  The university announcement indicates:

This shift, combined with other changes in the SIS vendor marketplace, prompted the UW to defer a decision about entering into a new MoU with KualiCo for Kuali Student development.

Recycled News
KualiCo’s most interesting recent news in the continuing Kuali saga is a July 8th press release that was publicized via LinkedIn with the title: “Coastal Carolina University selects Kuali Research as their SaaS grant & research management solution”
This is the first press release on the Kuali.Co pages of an institution “moving to” KualiCo’s SaaS offering since their formation last year; about eight months ago.  Or so it seems.

That must mean things are really starting to take off.  The doubters such as myself are finally proven wrong… or are we?   Let’s take a few minutes to compare this press release to some of the language in a June 5, 2014 press release by the Kuali Foundation.

Date: July 8,  2015

As a primarily undergraduate institution, our research administration staff and resources are limited, but we have worked hard to successfully increase our research volume. Kuali Research provides a single reliable source for proposal, award, and compliance information along with enhanced oversight and visibility. The built-in reports and user-friendly functionality provide our staff more time to spend with faculty. We are pleased with the service, reliability, continuous improvements, and seamless upgrades which allow us to administer our research and compliance duties without downtime or delay,” said Bruxanne E. Hein, Director of Office of Research Services at Coastal Carolina University.

They also state: “Kuali is the only company that delivers Kuali Research as a SaaS solution”
Kuali Foundation
Date:  June 5, 2014

As a primarily undergraduate institution, Coastal Carolina has a limited research administration staff and resources but is working hard to increase our research volume. Cloud Express will provide a single reliable source for proposal, award, and compliance information along with enhanced oversight and visibility with built-in reports,” said Bruxanne Hein, Office of Research Services Director.

If you think they are basically identical, you would be right.  Coastal Carolina University is a customer KualiCo inherited from rSmart over a year ago.  KualiCo seems to be having trouble with their business model. I think KualiCo felt the need to look resilient, so they have resorted to publishing puffery, and recycling old news.
That’s not all.  Even though the recent announcement made it sound like KualiCo held onto this client and has a long term relationship, the KualiCo press release on their blog about the win came out July 8, 2015 and an RFP was announced August 3, 2015.
( “Coastal Carolina University selects…), CCU publicly issued an RFP, seeking a long term contract for Kuali Coeus hosting and support.  Here is the header of the public Request for Proposal issued with vendors’ responses due on 9/8/2015:

To announce a win while there is an RFP issued by the institution for vendor bids is an effort to mislead in my opinion and raises the question of trustworthiness.  Buyer beware?
More trickery, smoke and mirrors:
KualiCo also says in their release that they are the only one to deliver Kuali Research as a SaaS solution.  I bet that is true since they are the only one with a product named “Kuali Research”  Frankly the press release of a win for an RFP that is about to be issued is very peculiar and the verbal gymnastics used to state that they are the only one with a product called Kuali Research as a SaaS solution is pretty funny as well.   Any time you see “We’re the only… “ you can pretty much assume there is some marketing trickery afoot.
We were told at Kuali Days 2014 that adding clients was absolutely necessary to make the creation of a commercial company successful.  It seems they are recycling news to make it appear something is happening.  All these signs put an even greater amount of doubt over the viability of KualiCo in the long term.
What about the Kuali Commercial Affiliate KCA support ecosystem?  The List of KCA’s has gone from 10 to 2 (Not counting EBSCO) Polus and Open Collab per my sources indicate did not renew but they are still listed as KCA’s.   It is again disingenuous for the Foundation to leave their name up to make it appear to the casual observer that Kuali Commercial Affiliates did not sever their affiliation with the Kuali Foundation. Although some might say this is just an oversight, but based on other factors we have seen this past year it appears to be a pattern.  It also appears from adoption announcements onlinkedIn and other sources that colleges and universities are getting quality Kuali support without the affiliation with the the Kuali Foundation.
Need (in)Patient Capital?
Here is the highlight of the “patient capital” strategy from the Kuali foundation:

The commercial entity is being structured in a way that enables some of the very good things that commercial entities can empower when financed by patient capital rather than beholden to quarterly returns of unaffiliated owners.

KualiCo recently announced a new board member, Darren Wesseman and highlighted his fundraising experience.   First of all, so much for “patient capital” if fundraising experience is now important.  Since universities have been reluctant to provide funding to KualiCo, it seems that they may now be willing to go a different direction to finance development.  But, let’s examine the pattern here.  rSmart now makes up a good part of KualiCo and Chris Coppola, the COO of KualiCo and the ex-CEO of rSmart proudly posted the news about Wesseman on LinkedIn and other venues.  Let’s examine how rSmart previously convinced investors to provide funds and what happened:
Private Investment of $2 million in Aug 2006
Private Investment of $3 million in Dec 2008
Private Investment of $8.5 million in Sept 2011
Last Round $10.75 million in August, 2012
Basically, rSmart burned through more than $24 million of investors’ money prior to selling assets to two companies in October 2014.  Once again, let the buyer beware!
Where are the disclosures, resolutions, and explanations?

  • There are indications Kuali and KualiCo have not provided (and actually refused to provide) any evidence that there is not a special arrangement with the designated Kuali Foundation director. Also, what would prevent KualiCo–after giving stock to Joel and other employees–from “out voting” any Kuali Foundation input and cancelling their agreement with the Kuali Foundation?
  • I do not recall any Kuali Foundation Board resolution providing the name of the permanent Kuali Foundation Director on KualiCo’s board (where is that KualiCo Press Release?)
  • The Kuali Foundation’s director on the KualiCo board should have reported back on the Foundation’s investment and KualiCo stock grants. The disclosures should have been made by the Foundation’s Director on the KualiCo board to the Kuali foundation board and the community.
  • How did the nonprofit Kuali transfer the licensing rights to the for profit KualiCo? KualiCo is not a wholly owned subsidiary of Kuali.  The foundation was supposed to be the steward of the community and public money and respect its fiduciary responsibilities. KualiCo now imposes AGPL licensing on previously ECL licensed software to achieve vendor lock-in.  This is a big one.

Just when you think you’ve heard it all, there’s more!
KualiCo apparently has now changed its name to “Kuali,”   a move that will only further demand an answer to the question of whether the historic non-profit Kuali is playing clandestine corporate gymnastics to benefit from commercial profit while continuing to enjoy its tax-free status under the IRS Code.  It’s no secret that the result of the for-profit designation “Co,” appended to “Kuali,” resulted in a significant amount of anger on the part of the Kuali members, who were not thrilled that their dues were used to fund a for-profit start-up and purchase part of the for-profit rSmart – all this with little input or approval, and without any resultant equity interest in KualiCo.
I think colleges and universities are smarter than that and are starting to lose faith in the Kuali foundation and the way it forced commercialization with KualiCo.   So where do we stand one year later?  In the middle of a dust storm.  We should know and see more, but we really don’t know. What you can see is KualiCo’s attempt to monetize Kuali software and community as well as their utter failure at so many levels all the while moving away from community and the spirit of openness.
When the dirt is blowing in the middle of a dust storm and you can’t see clearly you really need to wait until the storm is over before beginning to clean up the mess the storm brought upon you.  This storm is still picking up speed. Just like the “Okies” packed and headed for California during the Dust Bowl of the 1930’s  it may be time to pack up, leave and re-group in a better place.
Old Blog Post Stats:
August 31, 2015 | Filed under: ERP, Kuali, open source, Uncategorized and tagged with: , , , , ,
This post has already been read 449 times!

Stats since moving to new blog: 4265 for a total of 4717 views through  1-24 -2019

And now we move again…..






Leave a Reply

Your email address will not be published. Required fields are marked *