Bret Taylor and Kevin Gibbs's modern word processor works on almost any device. Is that enough to shake up a space Microsoft has dominated for decades?

By JP Mangalindan
August 13, 2013

FORTUNE — According to Bret Taylor and Kevin Gibbs, word processors have been stuck in a rut for the last three decades. Launch the latest version of Microsoft Word, and there’s the same cluttered array of toolbars, even a floppy disc button emblematic of saving progress.

“Your PC doesn’t even have a floppy disc anymore,” muses Bret Taylor, co-founder of the San Francisco-based startup Quip. Last year, Taylor, then Facebook FB CTO, and Gibbs, creator of Google’s GOOG App Engine, struck out on their own to release a product that took advantage of the rapid transition away from the PC toward the smartphone and tablet. With $15 million in backing from Benchmark Capital, Marc Benioff, Yuri Milner and others, the product evolved into Quip, a free word processor introduced this month for the desktop and iOS devices. A paid version, Quip Business, charges $12 a month per user, allows for up to 250 users per account — versus the free version’s five — and adds features like an administrative dashboard. Testing of an Android version is also underway.

To use it, Quip feels like the hipper, distant cousin to Word.  Users may type out documents but also hop from device to device when doing so, writing out most of the file on their desktop, then skimming and lightly editing their content on the phone or tablet. (To compare, a version of Word is only available to mobile users if they subscribe to Microsoft’s MSFT cloud-based Office 365 service.)  “Just taking Word and putting it on the smaller screen would not just a be an inelegant thing, but a frustrating thing to use,” says Gibbs.

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The app takes a lead from Facebook, where Taylor worked for nearly three years after the social network acquired FriendFeed, a startup he co-founded around aggregating social media. Quip includes a heavy dose of social interaction. Users can share and work on documents with each other, toss in photos and tables, make to-do lists, and call a users’ attention to an area of a document with the “@” sign.  “The odds that two people would be staring at the same document at the same time are almost zero,” explains Taylor. But thanks to Quip, a user’s ability to retrieve a file on their omnipresent smartphone almost enables a back-and-forth that feels more fluid and real-time.

Such was the case with an unnamed travel agency that tested Quip early on. Previously, the agency kept a Word document for every customer synchronized via Dropbox, a separate Google GOOG spreadsheet and task management software to keep track of everything from a checklist to a traveler’s dietary restrictions. Once they used Quip, the company was able to consolidate all those things into one document.

For now, Quip’s team of 12 will focus on software updates with more features that bolster Quip’s mobile and social abilities but also appease many people accustomed to conventional word processors. That includes Quip Enterprise, another pricing scheme due later this year with more advanced security features. Says Gibbs: “We want to open their eyes about what can be in a document.”

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