Two startups in San Francisco are betting that one of Google’s most ignominious failures will be their ticket to success. They’re launching software that implements key ideas from Google Wave, a complex communication tool that the company launched in 2009; at the time, Google claimed it would displace e-mail, but the project was quietly shuttered 16 months later after few people adopted it.

Wave was a complex combination of wiki, e-mail client, instant-messaging application, and more. The most technologically impressive thing about it was the way it enabled people to work on the same document, or “Wave,” simultaneously, and see the changes made by other people happening live around their own edits.

This is the experience that two new startups, Stypi and LiveLoop, are betting can be a success after all.

“Google Wave had superb technology, but it wasn’t put into a real product,” says Amal Dorai, cofounder and CEO of LiveLoop, which has $1.2 million in venture capital investment. “We’re taking that real-time collaboration that was a great idea and putting it into something that 750 million people already use: Microsoft PowerPoint.”

A person using LiveLoop’s service can work with an ordinary version of Microsoft’s presentation-editing software together with colleagues, seeing their edits—editing text, or adding or moving images—in real time. Dorai’s company enables Wave-like collaboration inside the familiar Microsoft software via a small program installed on the computer that synchronizes multiple copies of the same document being edited by different people, using different computers.

Dorai says that one Fortune 100 company is already trying LiveLoop’s software, and that his company plans to bring Wave-like collaboration to all of Microsoft Office. Dorai says one reason Wave failed was that it asked people to use the browser for tasks that typically take place in desktop apps, says Dorai, and it presented a confusing and unfamiliar interface.

“Everyone already knows how to use Office programs,” says Dorai. “We’re just making them better. We think this is a model for a new type of cloud application where they don’t have to be in the Web browser and we can combine the power of a desktop app with the benefits of centralization and cloud storage.” Google has already added Wave-style live collaboration to its online word processor, acknowledges Dorai, but he says his company’s tool has the potential to bring it to many more people by integrating with existing programs.

“We didn’t like the way Google Wave was advertised as a new class of tool, but we really liked being able to work together in the same space easily,” says Byron Milligan, cofounder of another of Wave’s reinventors, Stypi. “It makes people more productive.” 

The startup’s website automatically generates a blank text document that you can share with anyone by sending them that document’s unique URL. Collaborators can see each other’s typing, and add their own edits, just as with Google Wave. A “playback” button lets you replay the action that has already happened and roll back to a previous state if you want.

“Common use cases are teams that are drafting an e-mail together: for example, a startup writing to an investor, or working on a talk outline,” says Byron Milligan, who founded the company with Jason Chen. Stypi is supported by the Ycombinator startup accelerator that has been a launchpad for popular startups including cloud storage company Dropbox and document sharing service Scribd.

Stypi is targeting software developers, adding features that automatically highlight particular pieces of code to make a programmer’s life easier, but it has similar ambitions to bring Wave-like collaboration to the desktop apps people already use. A program similar to LiveLoop’s will be released in a few weeks: it will allow users of the Vim text editor, which is popular with programmers, to collaborate live. Milligan says Stypi plans to go much further, making the software it developed synchronize changes to different documents available for every kind of app.

“We know that PhotoShop can be done today, as well as Microsoft Word and the design package AutoCAD,” says Milligan. “We’ve built our technology in a general, easy way so that it can be integrated with desktop apps. We see the possibility to make all apps real-time.”