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Disclaimer: I am outside the database market (we view it all as just "storage") We are a similar play (open core, etc) I commented in the rethink thread as wel
by agibsonccc 10y ago
Disclaimer: I am outside the database market (we view it all as just "storage")
We are a similar play (open core, etc) I commented in the rethink thread as well.
A few lessons on the business model we ran in to:
1. Cloud is commodity/experimental. It could be the future though and there's no reason not to have an offering at least. We are launching a partnership with microsoft on azure to experiment with cloud for their hadoop offering. We found it was bring your own license and very similar to on prem. It seems like a no brainer to at least try this.
2. We are on prem first. Enterprise customers need "pay to blame" kind of like insurance. We have closed source features we license. Support is secondary and comes only with a license.
3. Bundling and minimum purchasing is key. You need to validate a customer has a budget.
1 thing that I notice database companies don't cover which kind of surprises me (that cloudera,red hat, etc do) is training and the "services swamp" 1 way to qualify customers and increase run way is a "small" amount of support you charge a high rate which in turn drives licensing revenue on top. A lot of the companies that have actually stood the test of time started like this.
Where we deviate:
1. Building a horizontal platform but focus on 1 product at a time. In our case, we have a generic platform we can license for teams that just need "something better". We focus on a use case such as fraud/network intrusion/money laundering and sell that. This is very similar to the oracle model. "Bundle a database with the app"
2. Any services we end up doing we put aside to turn in to a product down the road. In our case, we observe and learn the patterns and reapply those as "templates". In our case we accumulate expertise, make a bit of money, and monetize later. Many SAAS companies in our space keep the customer data because they need to build better models. I'm not quite sure what the analog in the database market here is.
We just keep the "lessons learned". The key here will be scaling that. In our case, we do that by focusing on 1 vertical use case and owning that. We also minimize engineering time on the platform.
In short: We have a dual licensing model where we have an "app" that's easy to sell in the market, get paid to explore the market (while focusing on/prioritizing 1 use case for more scalable revenue, and for teams that just need a better platform, we can just offer that and make some fairly passive licensing revenue.
1 other neat anecdote: for all the people raving on HN about what google's doing with AI, the problems people had 50 years ago are still the same ones people pay for today. The database market maybe similar, it might not be bad to learn from your predecessors but maybe just update the business model a bit (eg: cloud offerings,..) At the end of the day people pay for use cases over everything else. Think about the reason they are about HA not "HA is cool, they obviously want to pay for that"