4 ms·

Scaling software to the same level of revenue as a trade business is a sure way to get run over by the VC backed competition.

bruce511 3y ago
I get that when you live in a forest all you see are trees, but 99% of software companies are not in rather VC markets, nor have VC competitors. There are massive problems that come with "scale" - problems most people don't want. The VC model is all about the exit, whereas, again, 90-something-% of businesses, trades included, are focused on long-term sustainability, not on the "exit". Sure, the VC space us very visible, very "loud", gets a lot of press, and so on. And of course 100% of non-vc owners don't get to be billionaires, but to VC world is a tiny sliver of the software world.
- lumost 3y ago
  My experience is that you are either in/will be in the vc space - or you are in a specialized/regulated industry (finance/health) or you are a consulting firm. Even living outside of SV I don’t see a lot of in between firms.
  - bruce511 3y ago
    I guess that's a limit of your experience :) I'm in a space that doesn't remotely interest VCs, it's not a regulated industry, and we're not a consulting company. Actually we're in 3 such spaces. I also teach other (working) developers and while some are in health care the vast majority are unregulated. But to be fair, you've likely never heard of us, or our ilk. We do the boring office software that underpins every boring industry. We're not self-driving cars or exoskeletons, we're data in, data processing, data out. Our market isn't sexy enough, or wide enough for VCs, we don't need millions of $ anyway, so we've never bothered to ask for it. We do boring things like make a profit, and fund growth out of cash-flow. We hire slowly, and we don't do layoffs. We have lots of competitors just like us.
    - lumost 3y ago
      A good test for me of whether you are a consulting firm is “how many customers do you have?”, “How many of them provide significant revenue?”, “how much work serves only one customer?” There are many boutique SaaS firms - but if you only have a few customers, the business looks more like an outsourced internal team then an independent concern. happy to be proven wrong on this point, would give me some ideas for my career :)

bruce511 3y ago

I get that when you live in a forest all you see are trees, but 99% of software companies are not in rather VC markets, nor have VC competitors. There are massive problems that come with "scale" - problems most people don't want. The VC model is all about the exit, whereas, again, 90-something-% of businesses, trades included, are focused on long-term sustainability, not on the "exit". Sure, the VC space us very visible, very "loud", gets a lot of press, and so on. And of course 100% of non-vc owners don't get to be billionaires, but to VC world is a tiny sliver of the software world.

lumost 3y ago
My experience is that you are either in/will be in the vc space - or you are in a specialized/regulated industry (finance/health) or you are a consulting firm. Even living outside of SV I don’t see a lot of in between firms.
- bruce511 3y ago
  I guess that's a limit of your experience :) I'm in a space that doesn't remotely interest VCs, it's not a regulated industry, and we're not a consulting company. Actually we're in 3 such spaces. I also teach other (working) developers and while some are in health care the vast majority are unregulated. But to be fair, you've likely never heard of us, or our ilk. We do the boring office software that underpins every boring industry. We're not self-driving cars or exoskeletons, we're data in, data processing, data out. Our market isn't sexy enough, or wide enough for VCs, we don't need millions of $ anyway, so we've never bothered to ask for it. We do boring things like make a profit, and fund growth out of cash-flow. We hire slowly, and we don't do layoffs. We have lots of competitors just like us.
  - lumost 3y ago
    A good test for me of whether you are a consulting firm is “how many customers do you have?”, “How many of them provide significant revenue?”, “how much work serves only one customer?” There are many boutique SaaS firms - but if you only have a few customers, the business looks more like an outsourced internal team then an independent concern. happy to be proven wrong on this point, would give me some ideas for my career :)