Why The Enterprise Space Needs To Build Companies Like The Consumer Space
publictivity.com
publictivity.com
One important fact that is often overlooked in terms of SaaS+capital is the need to have a basic infrastructure in place in order to get customers. It's not, as the author says, as simple as building a product quickly and getting customers.
Your customers will usually be big companies who invest in software very conservatively and your competing with massive billion dollar enterprise software businesses.
To get customers requires sales reps, 1800 numbers, basic technical support, knowledge base, very secure servers, implementation support, etc. When your app is mission critical, theres no time for beta.
But if you're the billion dollar enterprise company, then that's not quite true. All you have to do is sell a checklist of features on some glossy paper and throw in some "services" which basically gives you cover for trying to get a functional (or maybe even just installable) build out the door.
And here's an article talking about Waste Management suing SAP for playing that game:
For SaaS, I don't think it's true at all. Why does it have to be different than the consumer market? You have a piece of software, it solves a need, you use it. In the consumer market people pay for an upgrade, with SaaS/biz software people pay on a freemium model/ after a trial basis.
-jlb
But I believe that getting a foothold in the market would also require an 800 number with people who understand the product very well on the end of it.
Also I think the most important point he makes is this:
"Focus on User Experience"
I can't tell you how hard it has been for me to use some business apps in the past! I personally believe the application should really be an extension of their routine, not an entirely new routine.
I'd bet this is the key to success in the enterprise space, make people do less work and they will appreciate it.
Taking a picture of a business card and save the info automatically instead of saving, putting it in a rolodex and also manually entering the info into your phone and/or outlook.
Click to call buttons so that they dont have to dial a number.
Having word docs/pdfs templated so they can be filled in automatically using the persons info instead of having to fill it in manually.
Make the format easily exportable for re-use in another system (salesforce to basecamp or salesforce to calyx or basecamp to blinksale or harvest to less accounting).
These are all things that can be done but arent available to the mainstream SaaS user.
My last enterprise job was with a large shipping company (that drove brown trucks). Their internal software for call centers was far from easy to use. I offered to write apps internally but could never get anything green-lighted.
I'm not discounting user experience-I just don't think an enterprise startup can win on that alone.
Enterprise 1.0 utilized decision making my one person, the CIO/CTO. Enterprise 2.0 is adopted by the users and the personnel inside the organization.
It's true that selling is hard, but that is why we have an experienced sales staff. And yes, sales can take 6-12 months in the worst case, but I think you underestimate the number you can have in the pipeline at once and overestimate the cost to support each sale.
One more note in defense of enterprise oriented startups: as a hacker, I don't find creating enterprise software to be less palatable than consumer software. The selling is compartmentalized in a sales dept, so it's not as if I'm the one jumping through the enterprise sales hoops. Obviously, if you're hoping to keep your company so small that you don't have a dedicated sales department, it's a much different story.
As a startup, it's easy to differentiate yourself from competitors by offering better-quality service. The difficulty lies in scaling up to a large number of customers.