What Comes After SaaS?

What Comes After SaaS?” is a collection of some interesting thoughts on the evolution of the software industry, its current position and issues, and what’s coming next.

Here are a few bits to get you started:

[T]he easy availability and mass adoption of cloud-based (SaaS) technology makes advanced software systems so much easier/cheaper/faster to build that “value” is rapidly bleeding out of the software stack. Yes, software is eating the world, but software’s very ubiquity is starting to threaten the ability to extract value from software. In other words, the ability to write and deploy code is no longer a core value driver.

And:

In an era of cloud and open source, deep technology attacking hard problems is becoming a shallower moat. The use of open source is making it harder to monetize technology advances while the use of cloud to deliver technology is moving defensibility to different parts of the product. Companies that focus too much on technology without putting it in context of a customer problem will be caught between a rock and a hard place — or as I like to say, “between open source and a cloud place.”

And here’s the best part, talking about Cloud 3.0:

The next chapter of Cloud software will lead to an explosion of new vendors and offerings. But they won’t quite look the same as before — expect lots of point solutions (run by small teams or even individuals) and software as a delivery for more elaborate (e.g. human-in-the-loop) service.

This new way of doing business is still developing rapidly. But here’s a spotting guide to identify this new breed of company in the wild:

Cloud 3.0 Company Differentiators:

  • Connect from anywhere: one click auth, integrations with all major platforms with relevant data sources to power the tool
  • Open platform: complete developer APIs and export functionality — and maybe even storing core data in one or more other vendors’ systems
  • Programmatic use: many happy customers may only ever interact programmatically — no more interfaces, dashboards or logins to remember. Just value and connectivity.
  • Clear core value: most companies seem to fit in one or more of the categories below:

One or More Core Value

  • I: Best-in-Class Point Solution (e.g. Lead Scoring)
  • II: Connectivity Platform — the integrations are the product (e.g. Segment, mParticle, Zapier )
  • III: Solution Ecosystem — the core value of product might actually be other developers who happen to deployer or deliver their value through this product’s pipes.

Interestingly, Salesforce — who brought us “The Cloud” — may even be the first major window to what next generation companies look like. After all, one could argue the value to a SMB choosing Salesforce (instead of the many ways to manage sales contacts) has become:

  • A standardized schema for CRM data
  • Easy integrations with hundreds of other point solutions
  • A pool of independent contractors with familiarity of the problem space

We could imagine even faster innovation if only there were a way to establish trust with many remote vendors and workers, each offering the very best point solution in the world. 10 Million “companies” powered by the very best person in the world at their solution. Sounds a little bit like Ethereum and the token-based economy…

The Highest-Paid C.E.O.s in 2016

The New York Times has this awesome chart of highest paid Chief Executive Officers (CEOs) in 2016.  You can sort and filter the data in a variety of ways.

Most of these guys and gals make more a year than the rest of us will ever make in our lifetime.  I guess, they totally deserve it.  I’m sure all of them work really hard to get these money.

Mautic: Open Source Marketing Automation Software

Mautic is an Open Source marketing automation software, which provides a whole bunch of functionality around contact tracking, campaign management, mass mailing, landing pages, and more.  It can be self-hosted or used as Software-as-a-Service (SaaS).  The source code is on GitHub and licensed under GPLv3.

It provides an API, and is already integrated with a whole lot of services, varying from social networks and instant messengers, to CMSes and CRMs.  Scroll down the Tour page for a comparison table against such alternatives as Marketo, InfusionSoft, Hubspot, Pardot, and Eloqua.

 

Cyprus : startup visa proposal

CNA shares some interesting news:

A proposal promoting startups visa, aiming to attract entrepreneurs from non-EU countries will be submitted to the next meeting of the Council of Ministers for approval, Cyprus President Nicos Anastasiades has said.

Addressing a graduation ceremony of IDEA, a starup programme co-founded by Bank of Cyprus and CIIM, the President also announced that a proposal from the legal framework for university spinoffs, liking academic research with entrepreneurship will be tabled within the next three months.

“We believe that the Cypriot startup visa will be one of the most competitive and will bring multiple benefits in the medium-term both as regards new jobs as well as promoting innovation and research and the boosting the competitiveness of our economy,” the President said.

Of course, knowing how long things take in this country (especially if the government is involved) and how twisted they get by the implementation time, one shouldn’t hold one’s breath.  But there’s hope, if nothing else…

RethinkDB: why we failed

Startups are born and gone every single day.  Much more often so in technology sector.  Most of these just disappear into the ether.  RethinkDB at least leaves the useful trace of analysis of what happened and why they failed.

When we announced that RethinkDB is shutting down, I promised to write a post-mortem. I took some time to process the experience, and I can now write about it clearly.

In the HN discussion thread people proposed many reasons for why RethinkDB failed, from inexplicable perversity of human nature and clever machinations of MongoDB’s marketing people, to failure to build an experienced go-to-market team, to lack of numeric type support beyond 64-bit float. I aggregated the comments into a list of proposed failure reasons here.

Some of these reasons have a ring of truth to them, but they’re symptoms rather than causes. For example, saying that we failed to monetize is tautological. It doesn’t illuminate the reasons for why we failed.

In hindsight, two things went wrong – we picked a terrible market and optimized the product for the wrong metrics of goodness. Each mistake likely cut RethinkDB’s valuation by one to two orders of magnitude. So if we got either of these right, RethinkDB would have been the size of MongoDB, and if we got both of them right, we eventually could have been the size of Red Hat[1].

Thank you, guys.  There are valuable lessons in there.  And three points, of course:

If you remember anything about this post, remember these:

  • Pick a large market but build for specific users.
  • Learn to recognize the talents you’re missing, then work like hell to get them on your team.
  • Read The Economist religiously. It will make you better faster.

The Three Machines

It’s amazing how well-timed this article is for the things that go on around me right now.  But even if you are not spending most of your days, nights, and weekends building a company at this moment, have a go at it anyway.   Here’s a bit to get you started:

My current hypothesis is that if you are a CEO, focus your organization on the three machines. Product, Customer, and Company. Then, have a direct report own one of them. If you have a sub-scale leadership team (e.g. you are three founders and four other employees), as CEO you can own one, but not more than one. As you get bigger (probably greater than 20 employees), hopefully now you have enough leadership to have one person own each, but recognize that if someone is being ineffective as a leader of one of the machines, you will have to replace them in that role (either by firing them or re-assigning them).

 

Google and HTTPS

Here are some interesting news on the subject of Google and HTTPS:

In support of our work to implement HTTPS across all of our products (https://www.google.com/transparencyreport/https/) we have been operating our own subordinate Certificate Authority (GIAG2), issued by a third-party. This has been a key element enabling us to more rapidly handle the SSL/TLS certificate needs of Google products.

As we look forward to the evolution of both the web and our own products it is clear HTTPS will continue to be a foundational technology. This is why we have made the decision to expand our current Certificate Authority efforts to include the operation of our own Root Certificate Authority. To this end, we have established Google Trust Services (https://pki.goog/), the entity we will rely on to operate these Certificate Authorities on behalf of Google and Alphabet.

The process of embedding Root Certificates into products and waiting for the associated versions of those products to be broadly deployed can take time. For this reason we have also purchased two existing Root Certificate Authorities, GlobalSign R2 and R4. These Root Certificates will enable us to begin independent certificate issuance sooner rather than later.

We intend to continue the operation of our existing GIAG2 subordinate Certificate Authority.

If you need a bit of help putting this into perspective, this Hacker News thread has your back:

You can now have a website secured by a certificate issued by a Google CA, hosted on Google web infrastructure, with a domain registered using Google Domains, resolved using Google Public DNS, going over Google Fiber, in Google Chrome on a Google Chromebook. Google has officially vertically integrated the Internet.

Engineers Salary Data

Amitj Aggarwal, former Staff Engineer at Google (2008-2012), has collected a whole bunch of data in regards to engineers salaries, in USA and worldwide.  His points seem to be overly optimistic at times, but I don’t have any links handy to contradict his research.

Here are a few points to get you started:

  • Zoho, Salesforce pay 40% more than Oracle, Cisco, GE!!!
  • Top 7% or so engineers at Netflix, Amazon, Google, Facebook are paid more than $1.4M per year. Next 10% make $700K on average.
  • Facebook has lost relevance to Slack, LinkedIn, Snapchat, Pinterest and Quora. If you are working at Facebook ask for a 50% raise else move to a startup.
  • Oracle is loosing to cloud startups. If you are working at Oracle ask for a 60% raise else move to a startup.
  • ENGINEERS DO NOT WASTE MONEY ON AN MBA. You will make 2X more on average as an engineer.
  • Tableau, Splunk, Slack, Airbnb, Quora, Twitter, Facebook, Google pay more than $320K salary to their top hires. Definitely interview at these fine places. Uber top engineer salaries are $190-340K per year.
  • Starting salaries for fresh software engineering graduates is now $130K-160K. Ask shamelessly. For the best ones its ~$180K.
  • Apple pays 60% more than Samsung.