Irish company's imaging software to become focus of major initiative after Enterprise Ireland brokers licensing agreement, writes Karlin Lillington.

For Vikas Sahni, the chief executive of a small Dublin software start-up company called SoftEdge Systems, the world has turned upside down.

"Well, not exactly upside down, but it has accelerated," he says, quietly pleased.

Sahni's 12-person company, based in the East Wall's Docklands Innovation Park, has gone from relative obscurity to being the centrepiece of a keynote speech last week by Brad Smith, senior vice-president and senior counsel for Microsoft at the US group's Global Leaders Forum in Lisbon. The company (and Enterprise Ireland) later received a nod from Microsoft chairman Bill Gates.

"Frankly, we were not expecting that things would move so quickly," he says, picking over a lunch platter in Lisbon's Four Seasons Hotel, where he is flanked by Minister of State at the Department of Finance Tom Parlon, Microsoft Ireland managing director Joe Macri, Microsoft's senior director for intellectual property (IP) ventures, David Harnett, and Enterprise Ireland chief executive Frank Ryan.

The comment is perhaps the understatement of the day. Only last September, the company was delighted to be launching its first product, a multimedia document creation programme called DocsAlive. Now, SoftEdge has become the focus of a major Microsoft announcement about its new IP ventures division, an unusual venture through which Microsoft offers a portfolio of its intellectual property to national development agencies. The agencies can then act as marriage brokers between the available IP - basically, source code for projects that Microsoft itself will not commercialise or utilise, but believes to have commercial potential - and the companies on their books.

The first agency to respond - and respond immediately, says Smith - was Enterprise Ireland, followed by the Finnish National Fund for Research & Development. The first company that Enterprise Ireland believed could make use of one of the bits of IP was SoftEdge, and hence, the company finds itself in the centre of a flurry of Microsoft publicity.

The IP in this case came from Microsoft's Beijing research lab. "It's a technology that finds the edges of the foreground and the background of an image," Sahni explains.

Utilised in DocsAlive, it will enable someone to choose one object from an image - say, a single person - and easily crop it from the background to use on its own. All it takes is a single mouse stroke to highlight the desired object in the image, he says.

Currently, this type of cropping can only be done using complex image editing software and painstakingly highlighting the edges of an object by hand. "It's all about letting the ordinary guy work with images," he says.

The company gets the source code for the technology, but not a finished product. It is up to companies to find a way to make use of the technologies, says Harnett.

Sahni notes that SoftEdge has also received much valued advisory input and access to researchers from Microsoft as part of the licensing deal.

Sahni said that prior to the matchmaking with Microsoft, the company had been quietly achieving its aims of a product launch last autumn and a careful move towards profitability, which he predicts for this year.

But following a single e-mail from Enterprise Ireland, SoftEdge found itself in the middle of talks with the world's biggest software company. "From that first e-mail to the actual signing of a licensing agreement was only six weeks," he says.

The company has had to rethink everything, from business plans to advertising to its next product launch in June, when DocsAlive will go out with the new Microsoft technology.

Instead of working on a couple of markets, they are now considering a much wider June launch and, crucially for SoftEdge, instead of stating on the box that the product runs on top of Microsoft's Office suite, with the look and feel of Office, they can now state that the product contains Microsoft technology.

Will they advertise that fact? "Of course!" says Sahni. "That is a major benefit for us. It is much stronger to say we have a licensing agreement with Microsoft than just that the product works with Office."

But the rethink in strategy, advertising and approach has meant long hours for the Indian chief executive, who came to Ireland several years ago on contract as a technology consultant, decided he liked the opportunities here and stayed on, eventually setting up SoftEdge. If still a bit bewildered at the pace of change, he clearly is full of anticipation regarding the next version of DocsAlive and the potential marketing boost the Microsoft connection could supply.

He also has much praise for Enterprise Ireland: "Many people think only of whether they can get grants from them.

"But to me their true value is the help they can give small companies - the introductions and the support - and the fact that they looked at an opportunity like this and then had companies in mind who could benefit."

Enterprise Ireland chief executive Frank Ryan said the agency had already retooled its strategy last May to include a unit that could focus solely on finding ways that small to medium-sized enterprises (SMEs) could license property from large companies.

"So when Microsoft announced IP ventures, we moved in right away. We were all dressed up and ready to go. We matched the research and development road maps of our companies against Microsoft's list of technologies.

"We found 14 companies that could be a potential match and we're very pleased that the first company in the programme is an Irish company," he says.

Five other Irish companies are in the process of negotiations with Microsoft for the programme too, he says.

"We're really endeavouring to look at global companies in a different way.

"Before, they were seen as a potential customer [for Irish services or products]. Now, we are looking at them as venture partners or for licensing deals."

Having an association with a global company can help establish a smaller Irish company, he adds, pointing out that many forget Sun Microsystems once owned one-third of Iona Technologies. "This is the time for partnerships," says Ryan.

"The time of Irish companies launching full frontal assaults on a market are over."