Yammer is going to get overtaken by Kato if it doesn't get its shit together

By Carmel DeAmicis , written on August 27, 2013

From The News Desk

For a while now, I've had 'Why does Yammer suck?' sitting in my list of possible story ideas. Given it has 5 million users as the premier enterprise social network, I'm astounded at the bugs that still plague it. Some names don't show up in the dropdown menu for @ tag functions. Multiple chat boxes with the same user will appear, confusing me about which one we're talking in. I can only make notifications disappear by going through my mailbox, even if I've clicked on them in my newsfeed. The list goes on.

Turns out, Sarah Lacy already did the Yammer sucks post months ago when Yammer went down without explanation. It deflated a day's worth of work for Pando since we rely on the platform for all our office communication and collaboration. One year later, Yammer hasn't gotten better and we're still on it but not by choice. The world is waiting for a better enterprise social network, and that day may be nigh.

Yammer get your shit together, or new upstart Kato might overtake you.

I saw Kato's power to upend Yammer or HipChat within 10 minutes of sitting with Andrei Soroker, the co-founder. He pulled Kato up, and as we chatted, a message popped up from a Kato user named Rohan Kapur. Kapur said, "When I'm in the process of editing a message and somebody replies while I'm editing, it posts the edit as a new message." Soroker responded instantly, "Yep -- known, but will fix."

Kato is setting out to be the reliable, functional, non-buggy, effective, and flexible Yammer or HipChat for enterprise companies. It's already got loads of useful features these other companies don't offer, like searchable chat, where you can search for any key word in a conversation you've had with someone from work.

Companies can create rooms for different topics or groups, like HR, Sales, or company events, so you can check what conversation is most important to you. No more dumping of the Friday ping pong tournament details into your email inbox alongside important client messages or notes from your boss.

Chat feeds can be set up for platforms like GitHub, WordPress, or ZenDesk. Notifications pop up in the Kato chat room when important events happen, like someone submitting a support ticket, or comments on WordPress blog.

And most importantly, every company that signs up for Kato -- paying $5 per employee per month -- gets a direct chatroom line to co-founders Soroker and Peter Hizalev. If anything goes wrong with the system, they know about it. After all, the startup is trying to battle spam while taking reliability seriously. The co-founders came up with the idea for Kato because they were tired of the problems of HipChat, which would occasionally go down without warning or explanation.

Kato Interface Kato Interface

We pay nothing for Yammer because we don't need fancy features, but I'm pretty sure we'd be willing to pay a smallish chunk of change every month for a Yammer that worked better, or a Kato that worked best. Yammer's got a help line for paying customers, but that help line doesn't seem to have fixed its myriad of platform bugs for non paying customers. Are they just giving the freebie subscribers the broken version? I suppose it's possible, but not a great branding idea.

When I asked Yammer about the problems they said, "We are aware of some bugs in the chat experience that are browser dependent and are working through them. We have specific enhancements on our chat functionality and read/unread message tracking in our near term roadmap that are currently being worked on." Excellent. I wonder how long its roadmap is?

That said, I've got a love/hate relationship with Yammer and there's definitely parts of Kato I don't like nearly as much. I won't be recommending Pando make the big switch to the new platform...not yet at least. The best part of Yammer is its social component. Its interface and newsfeed look just like Facebook, right down to profile pictures and individual user walls. It's a natural way to interact with my coworkers, since everyone's trained in the Facebook way, and my eyes are able to discern various chunks of information -- the feed, individual chats, private messages -- easily.

Kato on the other hand is a wall of large chat boxes, like if you had three or four gchats taking over your whole screen. To me it's not an intuitive way to interact, and I feel like I'm lost in a screen of text. It takes all the fun out of social at work.

Soroker says that company will be introducing a newsfeed function soon, and I hope it considers adding profile pictures, user walls/feeds, and other elements we've come to expect from our social networks.

If it does so, the search functionality and Kato help line are more than enough reasons to switch from Yammer or HipChat to Kato. I'm not the only one who feels this way. Jeff Atwood, founder of Stack Overflow, contacted Kato before they even made it into Techstars. Back then the company went by the name Le Chat, and had gotten minor coverage on Hacker News. Atwood send them a formal email, saying he'd be interested in testing the service but he had a handful of ultimatums first. He thought Kato needed a mobile app, a way to share pictures within chats, and email notifications if someone receives a Kato chat when they're not logged in. "It was a lot of nitpicky things that were really helpful," Soroker says.

Atwood said over email, "With Kato, we got real time web chat software, accessible on all our web browsers across all our devices on any screen size, that didn't suck!"

Rohan Kapur, the developer who messaged Soroker to report a bug, says he came across Kato by accident when Atwood tweeted about it, and he's been using it ever since. "Pretty much, it was awesome," Kapur says. "My friend and I were using email for chat. We tried Facebook messenger for chat too. Both clients were dumb, underpowered and left our information disorganized. Kato fixed that."

The company made enough development traction at Techstars that Brad Feld, serial investor/entrepreneur, co-founder of the Foundry Group, and Tech Stars mentor, decided to invest in it and lead its Series A. Kato just raised $1.76 million from the Foundry Group, SoftTech, and David Cohen. With the official funding announcement this week, anyone who subscribes in the next 60 days will get a free Kato chat line to Feld and the founders. After mentoring the team at TechStars Colorado, Feld is opening his door to Kato users as a marketing ploy.

When I asked Feld why he thought Kato had a chance when Yammer already dominates the market, he had the same impression I did. Feld says, "Have you ever tried to use Yammer across organizations? It's miserable."