eFileCabinet provides electronic document management and online backup solutions that help customers manage and protect their valuable data assets. The company, led by CEO and President Matt Peterson, recently took on venture funding from Canopy Ventures. Matt recently took some time to tell us more about eFileCabinet and the direction the company is headed.

Silicon Slopes:  Can you give a brief overview of your company and the solutions you offer customers?

Matt Peterson: eFileCabinet was founded in 2000 by a local CPA named James Blaylock with the hopes of creating an affordable system that could scan paper documents and store them on a PC. From that simple idea, eFileCabinet has grown into a national company with an installed based of close to 19,000 users.

Currently we offer two flagship products. The first is eFileCabinet; which is our electronic document management solution. This solution allows users to scan their paper documents and store them as indexed PDF files in a secure database repository. We have also created a means to quickly store and index MS Office files such as Word, Excel, and Outlook emails (including attachments) in their native formats into our system. eFileCabinet has the capability to store just about any computer generated file.

With all these customers scanning and storing their files electronically, we felt it would be a good idea to create a service in which they could securely and cost effectively backup these files to a remote data warehouse to protect themselves against computer failure. This online backup service is called Concentsus. This name is a play on the word consensus, which means majority of opinion. We put the word “Cents” in the middle because the service allows users the opportunity to literally back up and protect their computer files for just cents a month.

We have created service plans that allow home, small business and enterprise users to safely store their files to a remote location for protection against hardware/software failure and natural disasters. It truly is an affordable and effective insurance policy that everyone should have. This early success of this service has exceeded our expectations to this point.

Silicon Slopes:What’s your background?

Matt Peterson: I have been involved in the tech sector since 1998; having started and sold a company in California called Aspire Document Imaging, Inc, where I served as CEO. Aspire did system integrations for companies that wanted to adopt digital document management systems. We also ran a service bureau where we would use high speed scanners to convert paper to digital files for clients all over California. We had clients that ranged from cities and counties, school districts to prominent brokerage firms and pharmaceutical companies.

After selling Aspire in 2006, my family and I decided to relocate back to Highland, Utah and shortly thereafter the opportunity presented itself to join eFileCabinet as the COO. In January of 2007, just after the Canopy Ventures investment in July, I was appointed president and CEO by the board of directors.

Silicon Slopes: What’s different about eFileCabinet and other document management systems?

Matt Peterson: That’s an easy question. It would definitely be the ease of use and cost factors. eFileCabinet has been designed around the premise that customers want to efficiently and economically store their documents in a repository that are indexed and easy to view, print and email.  I liken this to many of the options that you see in the tool bar of Microsoft Word. Other than the copy, paste, print, save, and a few other functions, how many of these features does the typical person actually use? Not many more. We have built eFileCabinet with the same premise. Give the customer what they need to do their job quickly and effectively instead of piling on a bunch of features that nobody is going to use.

Just like any other company, we do have competitors. However, we feel that by constantly listening to our customers we have constructed a product that is highly functional and affordable for the masses and keeps us a step ahead.

Silicon Slopes:  How is data stored?

Matt Peterson: Data is indexed and stored in its native format whether it is a scanned Adobe PDF or a Word, Excel our Outlook email message. Data files are then retrievable via a keyword search or full text through Optical Character Resolution (OCR).

Silicon Slopes: What about your security & encryption? How do you convince customers that their data is secure?

Matt Peterson: eFileCabinet has developed a tightly integrated role based security system. Through the setup screens an administrator determines who sees what files in the database.  eFileCabinet even creates an audit trail that shows who accessed what files, what they did with them, and when they logged out. We built this component to comply with the medical field’s strict HIPAA regulations. We are beginning to realize that this security and audit trail are being warmly embraced in many other vertical markets such as HR and Insurance and Financial Services.

We have even added a feature that allows users to attach passwords to files that are to be emailed from eFileCabinet. This was a request by many of our existing customers.

An optional and extra layer of security allows each store file to be secured with 128 bit encryption. This encryption meets the stringent demands of the most strict government agencies as well as the SEC.

Silicon Slopes:  You were recently funded by Canopy Ventures. Other than the obvious infusion of capital, how is Canopy opening new doors for the company?

Matt Peterson: We were very fortunate to have been in talks with other VC firms around this time and felt that by going with Canopy we would not only be able to leverage the experience of their management team, but that by having a partner in close proximity we would be able to bounce around ideas and strategize on a more regular and face to face basis. Our relationship with Canopy has already proven to be valuable in introducing us to key industry contacts as well as providing additional guidance on current and future go-to market opportunities.

Silicon Slopes:  What is driving the adoption of document management systems today vs. five or ten years ago?  

Matt Peterson: Definitely cost and reliability. Ten years ago scanners cost $5,000 and software was even more. This pricing scheme put document management solutions out of reach for most of the SMB market.

On the other hand, the exponential increase of PC processor power over the last ten years has allowed the management of electronic files across the network and web to become a viable solution from the smallest business to the largest enterprise. Increased processor power has removed the frequent network bottlenecks that occurred when multiple users were viewing multiple documents.

Silicon Slopes:  What industries or markets do you see as having the most potential for adoption?

Matt Peterson: Currently we focus our efforts on eight major vertical markets across the country and around the globe. The markets include: accounting, banking, education, government, insurance & financial services, HR, Title, and legal. We are just now entering the medical market and our latest release includes functions for HIPAA adoption and compliance. We also just signed an agreement with Simplifile, the nation’s leading e-recording service, to integrate eFileCabinet into their system that is widely used by title companies and county recording offices.

Last year we started a reseller channel that currently includes over 35 resellers around the country, and we are adding about three new partners a month. We will be focusing our attention and efforts on building this channel to increase our market penetration. We recently added new partners in both Australia and Brazil.

Silicon Slopes:  Is there a measurable ROI for customers or are your solutions more of an insurance policy in case of disaster?

Matt Peterson: A few years back Price Waterhouse Coopers did a study on companies that lose their data through a natural disaster, theft or hardware software failure and the results were startling.  They found that 70% of companies that experience a major data loss go out of business within a year. One need not look much farther than the front page of a newspaper or nightly news to realize that now matter where you live you are prone to hurricane, flood, fire, tornado or earthquake. As far as hardware failure is concerned it’s not a matter of if, but when one or more of your hard drives will fail.

The answer to this question is that the true ROI on this type of solution is immeasurable. By implementing an electronic document management solution you will be saving your organization significant time, space and money.

Time:  Because never again will files be lost or misplaced. They will be scanned, indexed, and stored in a database that can be accessible to multiple users at the same time.

Space: Because no longer will valuable real estate be used to house row upon row of file cabinets. Office space which is at a premium in many locales can now be used for less clerical functions and more revenue generating activities.

Money: No longer will users waste time looking for lost or misplaced files or even the exorbitant amount of time to recreate permanantly lost files.