Delrina was founded in
Toronto in 1988 by
Zimbabwean expatriate
Bert Amato, South African expatriates
Mark Skapinker and
Dennis Bennie and American
Lou Ryan. Delrina was Bennie's third major entrepreneurial start up after co-founding
Mission Electronics, a high-end home entertainment equipment producer, and Aviva Software, which became
Ingram Micro Canada. Delrina's business strategy was to "establish technical and market leadership in niche markets", which it accomplished with its electronic form and PC-based fax software. A year before the firm was incorporated, Amato and Skapinker had quit their jobs to start work on an electronic forms product Delrina's initial corporate headquarters was located in a small office on Mount Pleasant Rd. in Toronto. A sales office was set up in
San Jose, California which became its worldwide sales center run by co-founder Lou Ryan.
Origins of PerForm Delrina's initial product offering was an electronic forms application called
PerForm. Amato and Skapinker came up with the idea for the product while working as consultants that what their clients wanted was a way to fill in forms electronically, rather than an easier way to create paper-based forms from a computer. There was significant and long-term uptake of electronic forms products within governmental agencies both in Canada and the United States, the latter spurred on in particular by the requirements of the
Paperwork Reduction Act to reduce the total amount of paperwork handled by the United States government. One of the firm's early major software deals included a multi-year agreement to sell PerForm to the U.S. Navy in 1990. It also scored highly when it came to workflow and routing functions as well as security features. In early 1991
InfoWorld selected PerForm Pro as its "Product of the Year" in the electronic forms category, and
PC World Magazine gave the product its "
Best Buy" designation. PerForm proved to be successful in its niche, effectively capturing the retail market by 1993. In the early 1990s Delrina made deals with
value-added resellers like
NCR and
GE Information Services who had the staff to customize the product to the needs of corporate customers looking to move away from paper-based forms.
Struggle for profitability Despite the growing revenues, the company struggled to make a profit. Heavy expenditures—primarily marketing along with research and development costs—drove the firm's losses from $500,000 from 1989 to $1.5 million by the end of the following fiscal year. For fiscal 1991 it posted a net loss of $1.7 million. Needing an infusion of funds, in April 1991 Bennie managed to raise $7.7 million in a
private placement. In early 1992 word leaked to the press on a possible merger between
WordStar International Inc., and soon after both firms made public the fact that they had signed a letter of intent on a merger deal. However, just over a month later word came out that the merger talks had fallen through, at the time cited to differences over "complex legal, accounting and management issues". WordStar, whose share of the
word processing market had by that time fallen to 5% (from a high of 80%) was seeking Delrina's advanced technologies while Delrina was hoping to utilize the other firm's established global sales network. Despite the failure of the merger talks, Bennie said soon after that "we're still convinced that a larger sales force would give us the kind of marketing clout we need. I still believe that it's possible for us to become a global operation". Delrina subsequently signed deals with Wallace Computer Services, UARCO and
NCR Corporation in an effort to gain greater sales distribution of its products.
Development of WinFax In a deliberate attempt to diversify the business, The Company chose to move into the fax software market with its
WinFax product. Software developer Tony Davis (another South African expatriate who had moved to Canada) was initially hired as a consultant to work on the forms line of products in the late 1980s, soon afterwards becoming part of that team. In his spare time he developed a prototype of what would become the first WinFax product, with the agreement that Delrina would be its publisher. In 1990 Delrina devoted a relatively small space to this new product at that year's
COMDEX (a computer trade show), under a sign that said simply: "Send a Fax from Your PC". It garnered the most attention of any Delrina product being demonstrated at that show. One of the key factors that differentiated this version of WinFax from other fax software packages of the time was the deliberate attempt to make the program compatible with all fax/modems. By the summer of the following year this number had grown to 50
OEM partnerships with various fax-modem and computer system manufacturers to bundle the "LITE" version of Delrina's WinFax software with their own products. Bundling the LITE version of WinFax proved to be lucrative for Delrina. Whenever a person used the program for the first time and submitted their registration information by fax to the company, Delrina would subsequently mail the user an upgrade offer for the PRO version. This sales technique proved to be very effective, and the firm ended up making most of its sales from these upgrades. which would become "Delrina Fax Pro". A version of the program was also designed for use in
DOS ("DosFax PRO") which was launched in June 1992. Initially looking for ways to further improve its electronic forms software, in November 1991 Delrina had attempted to buy two associated firms that produced
Optical Character Recognition (OCR) software, with the intention of incorporating OCR functionality into its forms products. The acquisition deal fell through, This functionality was incorporated into WinFax PRO 3.0 in late 1992, and subsequently in
FormFlow Despite the agreement with Caere, the subsequent version of WinFax used
Xerox's TextBridge OCR engine instead. Based on strong sales of WinFax, by October 1992 Delrina posted its first profitable quarter in three years. At the same time, the firm also announced its intention to acquire other software firms that sold into the consumer software market. The firm created daily planner software, providing time management features while providing some humour by featuring licensed cartoon strips like
Cathy,
Bloom County,
B.C. and
The Far Side. The firm became a wholly owned subsidiary of Delrina in a deal which also paid down Amaze's $3 million (U.S.) debt and placed two of the firm's directors on Delrina's board. These two individuals were
Rowland Hanson, former VP Corporate Communications for Microsoft and George Clut.
Berkeley Systems Inc. v. Delrina CyberLaw: The Law of the Internet p.27 Springer. 1996. 0-38794-832-5--> One of Delrina's
screensaver products was based on the licensed
Bloom County characters
Opus the Penguin and
Bill the Cat. The initial ''Opus 'n Bill
screensaver, launched in 1993, landed the company in court as its Death Toasters'' module depicted Opus taking shots at a number of flying toasters, a well-known emblem in Berkeley System's
Flying Toasters module from their
After Dark screensaver. Berkeley Systems sued for
copyright and
trademark infringement. The following court case of
Berkeley Systems Inc. v. Delrina was fought by Delrina on the basis that a software-based parody should fall under the same
First Amendment protection offered to the press. A preliminary injunction was filed against Delrina in September 1993 which halted the sale of the product, and subsequently forced a recall of it through the court. The case drew political satirist
Mark Russell to speak in defense of Delrina, who argued in favour of the screensaver as a valid parody, while the estate of composer
Irving Berlin sided with Berkeley. Commenting on the case involving his characters, cartoonist
Berkeley Breathed said: "If
David Letterman can depict the
NBC peacock wearing men's boxer shorts, then Delrina should be able to plug a flying toaster with hot lead". Judge
Eugene Lynch found in favour of Berkeley, citing that a commercial software product was not subject to the same exemptions as parodist literature, and that the toasters were too similar in design. In the court case, it was also cited that the design for winged toasters was not original and that the Berkeley Systems' design was itself derived from the
Jefferson Airplane album
Thirty Seconds Over Winterland, which also used flying toasters adorned with wings. The rock group lost the case as they did not trademark the album cover at the time of publication. While Delrina lost the court case, the publicity it generated was substantial, with coverage in over a thousand newspapers across North America, resulting in consumers turning out in droves to buy the offending program before it could be recalled. With the success of the WinFax product, the company grew rapidly. By early 1993 the number of employees had grown to 250, and by the end of the year to 350. The increasing success of the WinFax product consequently led to significant strains on the firm to handle the increasing volume of calls to its Technical Support department, as each of the over 300 modems on the market at the time had their own nuances in how they implemented the fax data standard. By the end of 1994 the situation had improved to the point where noted industry commentator
Robert X. Cringely put Delrina in his shortlist of firms providing "exceptional" product support. In order to further enhance the appeal of its new flagship product, in 1993 the firm established a Communication Services division, designed to tap into the commercial market. The firm started making deals with major
telecommunication companies, such as
BellSouth and
MCI Inc. in preparation for the services the firm was about to offer. In November of that year the division launched its Fax Broadcast service. The Fax Broadcast service allowed subscribers to upload a single fax and a recipient list to Delrina. Systems at Delrina would then send out the fax to the recipients on that list, to a maximum of 500 fax numbers. A subsequent Fax Mailbox feature—which enabled subscribers to remotely access both fax and voice messages from a single phone number—was initially held up following a dispute with
AlphaNet Telecom for the rights to the technology. This dispute was resolved by June 1994, though with both sides publicly disputing the story of the other, and with AlphaNet receiving an undisclosed sum in compensation. and employed over 500 people, most located at its offices in Toronto. The firm was shipping 200,000 units of WinFax a month, and had an installed base of four million users. The cost of doing business had also improved, as the firm's
cost of sales was now 25% of net sales, down from 30% the previous fiscal year, The firm decided to work on a suite of applications designed to be an enhancement on what was to be available in
Windows 95. and used it as the basis for the initial version of its
WinComm online communications software. and then using it as a distribution channel for free versions of its WinComm LITE and DOS-based FreeComm products in March 1995. When the Internet was opened to commercial interests in the mid-1990s, Delrina started to expand in this nascent market space with their
Cyberjack 7.0 product, launched in December 1995. Created by a development team based in South Africa, it included a
Web browser,
Usenet news reader,
ftp client,
IRC and integration with the Microsoft Exchange email program. The program used an interesting variant of the now-common bookmark, using a "Guidebook" to store information for various Internet addresses.
CommSuite 95 shipped later that same month, bundling WinFax PRO 7.0 along with WinComm PRO 7.0, TalkWorks and the Cyberjack suite of Internet components. With the release of Windows 95 in August 1995, Delrina was now competing directly against Microsoft in the fax/electronic communications marketplace, as Windows 95 included a basic faxing application as an accessory, along with a licensed version of
Hilgraeve's
HyperTerminal communication package, (which was also used as the basis for Delrina's own WinComm program). While these applications offered only rudimentary fax and online communication services in comparison to the mature Delrina products, Microsoft was perceived as a potentially serious future competitor in the communications market space. The release of the initial version of Microsoft's
Internet Explorer in late 1995 as a free product effectively killed off the early
emerging market for non-free browsers, creating a market where Delrina's Cyberjack browser could not hope to compete.
Acquisition by Symantec and aftermath In late Spring of 1995, Delrina Chairman Dennis Bennie met with Symantec CEO
Gordon Eubanks to discuss the possibility of merging the two firms. In September 1995 Delrina's founders—who owned a controlling interest in the firm—sold the firm to
Symantec in a stock deal worth $415 million US. The deal was first announced on July 6 of that year, with shareholders from both firms approving the merger on November 20. The merger was completed on November 22, 1995, and Delrina officially became part of Symantec. The deal made the merged company the fifth largest American software firm at the time. The firm became the "Delrina Group" within Symantec, which brought under its control other communication software products that belonged to the parent firm, such as
pcAnywhere. Bennie joined the Board of Symantec and was also appointed an Executive Vice President. At its height the company employed more than 700 people worldwide, the majority based in Canada. Symantec was following a general trend of large American firms buying smaller Canadian software companies. Other contemporaneous examples include
Softimage and
Zoom-it being bought by Microsoft, and
Alias being bought by
Silicon Graphics. Parts of the company were subsequently sold off, such as the sale of Delrina's Electronic Forms Division to
JetForm in September 1996. JetForm, which later changed its name to Accelio, was in turn bought by
Adobe Systems. Adobe officially discontinued the electronic forms products in 2004.
Creative Wonders bought the rights to the Echo Lake multimedia product, which was re-shaped as an introductory program on multimedia and re-released as
Family Album Creator. Though the market for fax software would shrink significantly as the use of email became more pervasive, WinFax brought in significant revenue for Symantec; a year after the merger sales of fax software accounted for 10% of Symantec's revenues.
Post-Delrina Delrina was a catalyst for entrepreneurial talent and greatness, as many of the principals and employees of Delrina went on to find new successful ventures. With investments from Skapinker and Amato, and Bennie as lead Director, Davis went on to form Lanacom, which developed an early Internet "push content" product. This firm and its technology were sold just over a year after its inception to Backweb, a NASDAQ listed software company; Davis remained president and Bennie was brought on as Director. Skapinker and Davis then went on to found
Brightspark, a software venture capital firm. Brightspark Ventures raised a number of VC Funds from Canadian Financial institutions raising $60m in 1999 and $55m in 2004. Brightspark employed a number of ex-Delrina employees including Allen Lau, Eva Lau, Sandy Pearlman, Marg Vaillancourt. Brightspark Ventures has twice won the Canadian Venture Capital Association "Deal of the Year Award", for the sale of ThinkDynamics to IBM and for the sale of Radian6 to Salesforce.com. Bennie would move on to found XDL Capital, a company which manages venture capital funds. XDL Capital—appropriately named after "Ex Delrina"—raised money for two funds: XDL Ventures (XDL), raising $25 million in 1997, and XDL Intervest (XDLI), raising $155 million in 1999. David Latner, former legal counsel for Delrina, was a partner in both funds, and Amato (former partner, Delrina) was an advisor and major investor to XDL Capital. He also participated in several investee companies as a Director and/or Advisor. XDL Intervest focuses primarily on internet-specific entrepreneurial companies and Bennie brought in two new principals: Tony Van Marken, former CEO of Architel Systems Corp. (ASYC), and Michael Bregman, former CEO of Second Cup Ltd. (T.SKL). XDL has assembled an established board and advisory team, which includes Canadian billionaire Robert Young, a native of Hamilton, Ontario, who co-founded Red Hat Inc (RHAT) and remains its chairman. Several of XDL's venture investments were in companies started or run by ex-Delrina employees who founded successful businesses, fostered by the innovative and entrepreneurial environment of Delrina. A few of the successes today are listed below:
Delano Founded by
Bahman Koohestani, another early developer at Delrina, was a company which developed e-business solutions for corporations. XDL Capital provided seed capital prior to Delano listing publicly. Bennie was the chairman. Delano was listed on NASDAQ (DTEC) was subsequently sold to
divine in 2003.
Pinpoint Software Corporation a supplier of software solutions for managing networked PCs, was founded in 1992 by Lou Ryan. Ryan was CEO & President with Bennie acting as director. Pinpoint was partially funded by XDL Capital. Pinpoint changed its name to ClickNet Software in 1998. Uniting the company name with the successful ClickNet product family name strengthens the product and corporate identity. The company was eventually renamed Entercept Security Technologies Inc. In 2004, Entercept was sold to Network Associates for $120M where they incorporated Entercept's technology into its McAfee line of antivirus protection and other security products.
Protégé Software was formed in 1996 and was founded by Larry Levy, Delrina's European Managing Director. Levy acted as president and CEO with Bennie as the principal investor. The company raised a $120M round of finance with XDL Intervest participating in 2003. Protégé has successfully launched 20 U.S. companies in Europe, nine of which are among Red Herring Top 50 Private Companies. In addition, five of these companies have gone public during Protégé's tenure with them. The company was ultimately sold to various buyers including
Warburg Pincus after the internet bubble burst.
Netect Ltd., an XDL financed venture developing network security software, was purchased by Bindview Development Corporation (NASDAQ:BVEW) in 2001. Marc Camm (Ex Delrina GM Desktop Communications Business Unit) was brought on by Bennie to manage Netect. After the company was purchased, Camm joined Bindview as the E.V.P. of Marketing. Prior to joining Netect, Marc was the general manager of Symantec and systems group product manager for
Microsoft Canada. Within a few years all of Delrina's major market focuses—fax and form software—would be overtaken or superseded by email, e-commerce and the Internet. Daily planning software remains a niche market, and the immersive 3D environment used for creating multimedia presentations has (so far) fallen by the wayside in favour of more traditional user interfaces. Symantec ended support for its final WinFax PRO product in June 2006. Delrina is best remembered by its former employees as an incubator for ideas and for providing industry experience to the many people who would go on to work at subsequent software and hardware companies, many in the Toronto region. A forum exists on
Yahoo called "xdelrina", where many former employees of the firm continue to keep in contact with each other. == Software and services ==