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One trait I’ve seen in “non-organic” software is the use of the Enterprise SaaS playbook. Start bottoms up, give away free or low/no margin services, gain adop

by jabo 4y ago

One trait I’ve seen in “non-organic” software is the use of the Enterprise SaaS playbook. Start bottoms up, give away free or low/no margin services, gain adoption, capture the market, then with the pressure to grow, they start moving upmarket, go after 100K+ deals and raise prices, and eventually price out / fire vast chunks of their early adopters. Been personally bit by this a few times, so these days I tend to very cautious about adopting non-organic software, at least not without a backup plan. I’m a founder myself and this is one big concern I have about raising VC funds. Wrote about this here recently: https://typesense.org/blog/why-we-are-not-raising-funds/ https://typesense.org/blog/why-we-are-not-raising-funds/ I’ve also started to use the term customer-funded (similar to VC-funded), instead of “bootstrapped”, since the latter seems to give off an impression of early stage whereas the former is a conscious choice and state of being.

pketh 4y ago
> these days I tend to very cautious about adopting non-organic software I’ve noticed the same thing happening to myself and hope to avoid a future where consumers only feel like they can trust/adopt software developed by FAANG type companies) Really great blog post and ‘Customer-funded’ is a really good term. I agree, much better than bootstrapped UPDATE: read even more of your posts/product page… if/when I add full data search to kinopio, I’ll be looking at typesense first :)
- deleted 4y ago
  [deleted]
- jabo 4y ago
  > UPDATE:… Let me know when you do!
polote 4y ago
This is clearly not the enterprise playbook. The enterprise playbook is to sell on slides, iterate with a few customers and go after even bigger customers. Start small and trying to go upmarket is the normal playbook for a b2b smb company that is not growing anymore. Managing enterprise customers is easier than managing thousands or small companies. And it also create a natural barrier to entry
- jabo 4y ago
  > The enterprise playbook is to sell on slides, iterate with a few customers and go after even bigger customers. I would call this product discovery and development with early adopters, something I hope every startup is doing. I've also seen this be called a Lighthouse program. > Managing enterprise customers is easier than managing thousands or small companies. And it also create a natural barrier to entry I definitely get the appeal. To build a billion dollar revenue (not valuation) venture scale company, you can either get 1000 users paying you 1M dollars each, or 1M users paying you $1000 each [1]. It's just painful as a relative early customer to get priced out and no longer be the target market for a company, especially when it has set its eyes on exponential growth and starts to see the SMB market as a means to an end. [1] https://christophjanz.blogspot.com/2014/10/five-ways-to-build-100-million-business.html https://christophjanz.blogspot.com/2014/10/five-ways-to-buil...
  - polote 4y ago
    The other way to look at it, is that if the company starts to give up a product-first market to an enterprise market it is because they are loosing or struggling to keep their customers in their first market and so they dont have the best product. So as a customer if you want the best product then you have to switch
alar44 4y ago
That's... just how you run a sustainable business. As you grow, you simply can't support the small guys with their legacy shit and corner cases. Every service business does this. You have to.
- jabo 4y ago
  I've actually heard the opposite. Once you have a few large enterprise customers who bring in disproportionate amount of your revenue, you end up having to service their bespoke needs and corner cases, at the risk of losing them as customers. So the product ends up inviting a lot of complexity.
  - _virtu 4y ago
    Having worked at a startup that was beholden to a very large client in the space. I too can agree that this is more like what actually happens. The tail wags the dog.
  - alar44 4y ago
    Exactly. You support 5 big ones or die trying to support 100 little ones.

by jabo 4y ago

pketh 4y ago

> these days I tend to very cautious about adopting non-organic software I’ve noticed the same thing happening to myself and hope to avoid a future where consumers only feel like they can trust/adopt software developed by FAANG type companies) Really great blog post and ‘Customer-funded’ is a really good term. I agree, much better than bootstrapped UPDATE: read even more of your posts/product page… if/when I add full data search to kinopio, I’ll be looking at typesense first :)

deleted 4y ago
[deleted]
jabo 4y ago
> UPDATE:… Let me know when you do!

polote 4y ago

This is clearly not the enterprise playbook. The enterprise playbook is to sell on slides, iterate with a few customers and go after even bigger customers. Start small and trying to go upmarket is the normal playbook for a b2b smb company that is not growing anymore. Managing enterprise customers is easier than managing thousands or small companies. And it also create a natural barrier to entry

jabo 4y ago
> The enterprise playbook is to sell on slides, iterate with a few customers and go after even bigger customers. I would call this product discovery and development with early adopters, something I hope every startup is doing. I've also seen this be called a Lighthouse program. > Managing enterprise customers is easier than managing thousands or small companies. And it also create a natural barrier to entry I definitely get the appeal. To build a billion dollar revenue (not valuation) venture scale company, you can either get 1000 users paying you 1M dollars each, or 1M users paying you $1000 each [1]. It's just painful as a relative early customer to get priced out and no longer be the target market for a company, especially when it has set its eyes on exponential growth and starts to see the SMB market as a means to an end. [1] https://christophjanz.blogspot.com/2014/10/five-ways-to-build-100-million-business.html https://christophjanz.blogspot.com/2014/10/five-ways-to-buil...
- polote 4y ago
  The other way to look at it, is that if the company starts to give up a product-first market to an enterprise market it is because they are loosing or struggling to keep their customers in their first market and so they dont have the best product. So as a customer if you want the best product then you have to switch

alar44 4y ago

That's... just how you run a sustainable business. As you grow, you simply can't support the small guys with their legacy shit and corner cases. Every service business does this. You have to.

jabo 4y ago
I've actually heard the opposite. Once you have a few large enterprise customers who bring in disproportionate amount of your revenue, you end up having to service their bespoke needs and corner cases, at the risk of losing them as customers. So the product ends up inviting a lot of complexity.
- _virtu 4y ago
  Having worked at a startup that was beholden to a very large client in the space. I too can agree that this is more like what actually happens. The tail wags the dog.
- alar44 4y ago
  Exactly. You support 5 big ones or die trying to support 100 little ones.