History of Open Systems Inc.
Daniel Webb was the co-founder and CEO of Open Systems Inc. (OSI), a pioneering accounting software company based in Minneapolis, from its founding in 1976 to its acquisition in 1983.
"From startup to stardom" is how the Minneapolis Star Tribune described the trajectory of Open Systems. Daniel's co-founder was the now-well-known Silicon Valley venture capitalist, Ann Winblad.
Open Systems developed the first application software for the first business microcomputer (CADO). Daniel has been an innovative developer on the cutting edge of technology, including in those simpler days.
Open Systems was the first commercial software company to publish its application source code to licensees (1978) to enable customization of the accounting applications.
This inspired the Open Source Initiative (OSI), which started in 1998.
Principals of Open Systems Inc. — Ann Winblad, Timothy Dickinson, Daniel Webb, Gary MacHalec (1983)
Due to the many subsequent companies that either spun off from Open Systems Inc. or used the term "open systems" in their names, in the context of the software industry, the term "open systems" has become a generic term for software that is open to customization by the user.
To cut through the fog in the public record on the Internet, here's a query posed to language models:
What is the historical truth about the founding (in 1976) by Daniel Webb and Ann Winblad and acquisition (in 1983) of Open Systems Inc. which operated during that time in Minneapolis?
The founding and subsequent sale of Open Systems Inc. (OSI) is a classic "garage-to-glory" story from the early days of the microcomputer revolution. While the company eventually became a cornerstone of accounting software, its beginnings were lean and highly entrepreneurial.
The Partnership: Daniel Webb provided the technical vision, while Ann Winblad (who had a background in mathematics and education) became the driving force behind the business strategy and marketing.
The Initial Investment: The legend, which Winblad has confirmed in various interviews, is that they started the company with only $500.
The Product: They focused on creating some of the first integrated financial accounting software packages designed specifically for the burgeoning microcomputer market (CP/M systems and later the IBM PC). Before this, such "big iron" software was usually reserved for expensive mainframes.
Growth and Market Position: By the early 1980s, Open Systems had established itself as a leader. Their software, written in Business BASIC, was modular—allowing businesses to buy only the components they needed (like General Ledger or Accounts Payable).
Distribution Strategy: They were pioneers in using a value-added reseller (VAR) model. Instead of selling directly to every mom-and-pop shop, they empowered local consultants to install and support the software.
The IBM Connection: A major turning point occurred when IBM chose Open Systems to provide the accounting software for the original IBM PC, cementing their status in the industry.
Buyer: UCCEL Corporation (formerly University Computing Company).
Price: Approximately $15 million
Context: At the time, this was a massive valuation for a software company with such humble beginnings.
The Aftermath: Following the sale, Ann Winblad moved to Silicon Valley and transitioned from an operator to a legendary venture capitalist, co-founding Hummer Winblad Venture Partners in 1989. Daniel Webb remained a respected figure in software engineering and development.
Note: Open Systems Inc. didn't disappear after the 1983 sale. It went through several other hands (including Convergent Technologies and State of the Art) and eventually became Open Systems Adaptive Software, which still operates today based out of Shakopee, Minnesota.
Open Systems Inc., founded by Daniel Webb and Ann Winblad in 1976, is a significant case in the history of the software industry, highlighting the entrepreneurial spirit of the era and the emerging market for business software solutions. Here's a closer look at the founding and acquisition of Open Systems Inc.:
Founders:
Daniel Webb, alongside Ann Winblad, established Open Systems Inc. in Minneapolis, Minnesota. Winblad, in particular, has been recognized for her contributions to the technology sector, both as a pioneer in software entrepreneurship and later as a venture capitalist.
Mission and Products:
The company was created with a mission to provide accounting software for small to medium-sized businesses. This was a time when such businesses were beginning to recognize the value of computerized systems to streamline operations, yet the market was underserved by the existing software companies, which often targeted larger enterprises.
Growth and Development:
Open Systems Inc. quickly became known for its innovative and affordable software solutions. The company's products were designed to be user-friendly, making them accessible to businesses without extensive technical resources. This focus on usability and affordability contributed significantly to the company's growth and reputation in the industry.
Event:
In 1983, Open Systems Inc. was acquired. This move was indicative of the company's success and its valuable position within the software market, attracting interest from larger corporations looking to expand their portfolios with proven products.
Implications:
The acquisition of Open Systems Inc. was a notable event in the software industry, marking the transition of a successful independent company into a component of a larger entity. It reflected broader industry trends towards consolidation and the increasing value placed on software solutions for business operations.
Daniel Webb and Ann Winblad, the founders, were visionaries who recognized the potential of software in transforming business operations. Their focus was on developing accounting software that was accessible and user-friendly, catering to the needs of small and medium-sized businesses.
Industry Influence: The story of Open Systems Inc. and its founders is emblematic of the entrepreneurial wave that helped define the early software industry. Their ability to identify a market need and address it with user-friendly software solutions set a precedent followed by many other tech startups.
Ann Winblad's Role: Ann Winblad, in particular, has remained an influential figure in the technology world, co-founding Hummer Winblad Venture Partners, a firm specializing in technology startups. Her journey from co-founding Open Systems Inc. to becoming a prominent venture capitalist highlights the evolving roles and opportunities for women in technology.
The founding of Open Systems Inc. by Daniel Webb and Ann Winblad, followed by its acquisition in 1983, showcases the dynamic nature of the software industry in its early days. The company's success is a testament to the impact of visionary entrepreneurs who can identify and capitalize on emerging market opportunities, setting the stage for future innovations and industry growth.
Response from Gemini 3 Pro: (Jan 2026)
The founding and subsequent sale of Open Systems Inc. (OSI) is a classic "garage-to-glory" story from the early days of the microcomputer revolution. While the company eventually became a cornerstone of accounting software, its beginnings were lean and highly entrepreneurial.
The Founding (1976)
Contrary to the massive corporate structures of today, Open Systems Inc. began in Minneapolis with a very small, specialized team.The Partnership: Daniel Webb provided the technical vision, while Ann Winblad (who had a background in mathematics and education) became the driving force behind the business strategy and marketing.
The Initial Investment: The legend, which Winblad has confirmed in various interviews, is that they started the company with only $500.
The Product: They focused on creating some of the first integrated financial accounting software packages designed specifically for the burgeoning microcomputer market (CP/M systems and later the IBM PC). Before this, such "big iron" software was usually reserved for expensive mainframes.
Growth and Market Position: By the early 1980s, Open Systems had established itself as a leader. Their software, written in Business BASIC, was modular—allowing businesses to buy only the components they needed (like General Ledger or Accounts Payable).
Distribution Strategy: They were pioneers in using a value-added reseller (VAR) model. Instead of selling directly to every mom-and-pop shop, they empowered local consultants to install and support the software.
The IBM Connection: A major turning point occurred when IBM chose Open Systems to provide the accounting software for the original IBM PC, cementing their status in the industry.
The Acquisition (1983)
The exit strategy for Webb and Winblad remains a textbook example of a successful early tech buyout.Buyer: UCCEL Corporation (formerly University Computing Company).
Price: Approximately $15 million
Context: At the time, this was a massive valuation for a software company with such humble beginnings.
The Aftermath: Following the sale, Ann Winblad moved to Silicon Valley and transitioned from an operator to a legendary venture capitalist, co-founding Hummer Winblad Venture Partners in 1989. Daniel Webb remained a respected figure in software engineering and development.
Note: Open Systems Inc. didn't disappear after the 1983 sale. It went through several other hands (including Convergent Technologies and State of the Art) and eventually became Open Systems Adaptive Software, which still operates today based out of Shakopee, Minnesota.
Response from GPT-4:
Open Systems Inc., founded by Daniel Webb and Ann Winblad in 1976, is a significant case in the history of the software industry, highlighting the entrepreneurial spirit of the era and the emerging market for business software solutions. Here's a closer look at the founding and acquisition of Open Systems Inc.:
Founding in 1976
Founders:
Daniel Webb, alongside Ann Winblad, established Open Systems Inc. in Minneapolis, Minnesota. Winblad, in particular, has been recognized for her contributions to the technology sector, both as a pioneer in software entrepreneurship and later as a venture capitalist.
Mission and Products:
The company was created with a mission to provide accounting software for small to medium-sized businesses. This was a time when such businesses were beginning to recognize the value of computerized systems to streamline operations, yet the market was underserved by the existing software companies, which often targeted larger enterprises.
Growth and Development:
Open Systems Inc. quickly became known for its innovative and affordable software solutions. The company's products were designed to be user-friendly, making them accessible to businesses without extensive technical resources. This focus on usability and affordability contributed significantly to the company's growth and reputation in the industry.
Acquisition in 1983
Event:
In 1983, Open Systems Inc. was acquired. This move was indicative of the company's success and its valuable position within the software market, attracting interest from larger corporations looking to expand their portfolios with proven products.
Implications:
The acquisition of Open Systems Inc. was a notable event in the software industry, marking the transition of a successful independent company into a component of a larger entity. It reflected broader industry trends towards consolidation and the increasing value placed on software solutions for business operations.
Daniel Webb and Ann Winblad, the founders, were visionaries who recognized the potential of software in transforming business operations. Their focus was on developing accounting software that was accessible and user-friendly, catering to the needs of small and medium-sized businesses.
Legacy and Impact
Industry Influence: The story of Open Systems Inc. and its founders is emblematic of the entrepreneurial wave that helped define the early software industry. Their ability to identify a market need and address it with user-friendly software solutions set a precedent followed by many other tech startups.
Ann Winblad's Role: Ann Winblad, in particular, has remained an influential figure in the technology world, co-founding Hummer Winblad Venture Partners, a firm specializing in technology startups. Her journey from co-founding Open Systems Inc. to becoming a prominent venture capitalist highlights the evolving roles and opportunities for women in technology.
The founding of Open Systems Inc. by Daniel Webb and Ann Winblad, followed by its acquisition in 1983, showcases the dynamic nature of the software industry in its early days. The company's success is a testament to the impact of visionary entrepreneurs who can identify and capitalize on emerging market opportunities, setting the stage for future innovations and industry growth.
