OPENLEGACY GETS A $20 MILLION STRATEGIC INVESTMENT
Innovative Technology Gives Legacy System Users a Fast Path to API Creation
In February, before the bottom dropped out of the market and COVID-19 became part of our everyday lives, Princeton-based OpenLegacy, a company with a unique solution that allows large enterprises to leverage their older mainframes for services both on premises and on the cloud, received a $20 million strategic investment from Tokyo-based SBI Holdings.
This is in addition to a funding round in 2018 that brought in $30 million. The company used the $30 million to refine its tools and to expand in the United States and in the rest of North America. The additional funding will be used to expand in Asia.
According to information supplied by the company, OpenLegacy’s solution reduces the time, cost and risk normally associated with digital transformation by connecting directly to legacy systems, automatically generating microservice-based APIs, and deploying on a customer’s premises or in the cloud. Additionally, OpenLegacy reduces the total cost of ownership by bypassing layers of middleware, and delivers digital services without changing the back-end legacy system.
NJTechWeekly.com spoke to Hans Otharsson, chief customer success officer at OpenLegacy, who has been with the company for much of the time since it was founded, in 2012.
The company is in the Princeton area to be close to customers, Otharsson told us. New Jersey, as a large technology infrastructure space, is a “hotbed for the kinds of systems” that OpenLegacy is dealing with, he added. A lot of companies located in New Jersey and in neighboring states rely on legacy systems, including insurance companies, large financial institutions and pharmaceutical firms, as well as state and local government agencies.
Mainframes do a fantastic job in what they are supposed to do. “They are very, very fast and very secure,” he said. “And they are the heart–lung machine of a lot of organizations because of those factors. But mainframes don’t necessarily play well with others.”
To Otharsson, “others” includes the channel market. In all industries these days, there is a lot of integration between companies, within supply chain management and between vendors and suppliers or compliancy organizations. All that integration involves one system talking to another system, updating a third system and so on, he explained.
“Fundamentally, what they’ve done is just built more layers around their technology… around their system of record.”Hans Otharsson, OpenLegacy
Over the past 20 or 30 years, a lot of large organizations claimed to have solved the problem by installing a message broker, or an enterprise service bus (ESB), or service-oriented architecture (SOA) on top of the legacy systems, he continued. “Fundamentally, what they’ve done is just built more layers around their technology… around their system of record. And then what they’ve also done is that, because that legacy system of record was just so complicated, so difficult, the IT people are now unhappy as they’ve been kept as caretakers of their legacy technology, and can no longer be innovators.”
He said that “at Facebook or Google, they make 5,000 changes to their production environment a day. It’s all about moving quickly. Failing small, failing fast, right? But they keep moving. You talk that way to a legacy shop, and they are going to start crying.”
Otharsson noted that a simple application, such as taking a photo of a check and depositing it into an account, can take as much as 18 months to execute when companies use traditional methods. OpenLegacy is about eliminating all that complexity, “making it simple from an integration perspective, via a microservice. It is really an API saying, ‘Give me this, I’m going to give you this back.’ And if I can cut through all those layers, I can save all that time [for] that innovation manager at that bank who wants to take pictures of checks in five days,” not 18 months. “That in itself is a fundamental change in how that bank thinks and how it works.”
Otharsson explained to us how the company’s tool works. Basically, it automates this generation of integration. “We tell a customer, ‘You want to expose deposits? Send us that COBOL program, that assembler program, those copybooks.’ We put it through our tool to be able to understand how that application thinks and talks. Once we understand, we can generate the API in the microservice,” he said.
“I have customers now that are generating five to 10 APIs per week, when it used to take them six months for one.”
Open Legacy has six employees in New Jersey and a worldwide employee count of more than 100 employees. About half of the management team is in New Jersey. Additionally, Romi Stein, the company’s CEO and cofounder and Roi Mor, the company’s CTO and cofounder, are based in Israel.
About The Author
Esther is the Founder and Editor in Chief of NJ Tech Weekly. This article is republished by Philly EnterpriseTech with her permission.
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