Sunday, June 11, 2023

The Hollowing Out of the Software Middle

'Software companies taste like chicken,' says private-equity mogul. 'They’re selling different products, but 80% of what they do is pretty much the same'

SHOW: 726

CLOUD NEWS OF THE WEEK - http://bit.ly/cloudcast-cnotw

CHECK OUT OUR NEW PODCAST - "CLOUDCAST BASICS"

SHOW SPONSORS:

  • Equinix Global Data Centers and Networking 
  • Learn more and signup at https://deploy.equinix.com/. Use the coupon code CLOUDCAST to get $500 in credits to get started. 
  • Find "Breaking Analysis Podcast with Dave Vellante" on Apple, Google and Spotify
  • Keep up to data with Enterprise Tech with theCUBE

SHOW NOTES:


THE MARKET USUALLY ONLY SUPPORTS THREE OPTIONS

  • Walking around KubeCon,nearly every segment had 6-10 companies offering solutions
  • Markets can’t sustain more 3 in any category (Market Leader, Market Follower, Cheaper Option)
  • The Market can’t understand the differentiation of the 6-10 company market; 80% of the functionality is the same.
  • We’re coming out of Unicornpalozza (2019-2022)

OPEN SOURCE AND SAAS HAVE HOLLOWED OUT THE MIDDLE OF SOFTWARE

  • Open source typically highlights the creator, largest contributor to a project
  • Beyond that, open source is “integration” companies, or “lifecycle” companies
  • Large companies (or platforms) can buy up the “feature” companies to fill in their gaps
  • Companies in the middle have to build sales and marketing around mostly undifferentiated messaging or products.
  • SaaS allows companies to leverage product-led-growth, and micro-target to specific use-cases. 
  • The successful middle (mid-sized, decent growth) will get picked off by PE
  • The unsuccessful middle (great tech, bad execution) may get picked off by large vendors
  • The unsuccessful middle (average tech, bad execution) will go under


FEEDBACK?




from The Cloudcast (.NET) https://bit.ly/45UVY2a
via IFTTT

No comments:

Post a Comment