Money, power, intelligence, and enterprise software that works is sexy as hell

The following is a guest post by Craig Rosenberg, CEO and Editor of Funnelholic Media.

Craigpic

Crowdsourcing is sexy.  I took the question: “Why is enterprise sexy again?” to a number of enterprise software thought leaders to get their takes.  It was the best move I could have made.  Or put another way, I would not have said it better myself….

The result, three reasons why enterprise is sexy again:

 

  1. Revenue is sexy

“Because customers actually have money and will spend it. Because the problems that can be solved have real value”
— Chris Selland, VP of Marketing for Vertica from HP Software

“First, I think we’re seeing the crest of the replacement cycle rolling around, delayed by several years of recession. Money makes everybody seem sexy.”
— Chris Bucholtz, Editor in Chief for CRM Outsiders

  1. Software that actually works and delivers value is sexy

“For the first time ever, enterprise software is becoming flexible, adaptable and unshackled from the stringent control of central IT. Autonomy comes high on Maslow’s hierarchy of needs and modern enterprise software is enabling autonomy in spades. Given this fact, and the fact that these new, easy to use tool are finally allowing business units to remove technology as a blocker to achieving their strategic outcomes, is it any surprise that some would describe this as enterprise software being sexy?- I think not. Add to this the fact that, from the investment side, enterprise software companies are providing the returns that consumer plays sadly do not, and you have factors that both from a supply and a demand side perspective result in enterprise being different to what it ever has before.”
— Ben Kepes, Advisor, Investor, Commentator on Cloud Computing and Technology Generally

“Enterprise software vendors have a new sense of confidence: the current generation of tools is more refined and more aligned with user needs, and the vendors are becoming smarter about telling the story of how the software can help users. They’re increasingly skilled at using the language of the customer instead of the language of the software industry. To put it in dating terms, they’ve learned to say, “enough about me – let’s talk about you” – and then they’ve learned to talk about themselves in the context of the customer’s problems. And finally, you can’t underestimate the value of software that draws a straight line to ROI. Enterprise software does that very effectively.”
— Chris Bucholtz, Editor in Chief for CRM Outsiders

  1.  Money, power, and intelligence are sexy as hell

“Enterprise software spend is about $250 Billion each year, and growing circa 8% each year.  Money is sexy in my book.

Enterprise software lets companies do what they do, without it you would not be able to use your cellphone, get on an airplane, buy food, clothes, books, music, and most anything else.  Intelligence is sexy in my book.

Enterprise software uses technologies that most consumers don’t even know about (try WebRTC for real-time video and voice communications, in-memory analytics just from the recent batch) and hardware that makes grown men and women drool when they hear the specs.  Leading edge technology is sexy in my book.

Enterprise software has defined, limited, and ended more careers that most anything else in this world for people who underestimated it.  Power is sexy in my book.

Any way you look at it, money, power, intelligence – those are sexy attributes.  Aaron said it is sexy again because he has not had sufficient experience with it.  Enterprise software never stopped being sexy from the very first COBOL program (talk about a sexy language) implemented in time-share.”
— Esteban Kolsky, Independent Analyst on Customer Strategies and Principal and Founder of Thinkjar

 

About Craig
Craig Rosenberg is the CEO and Editor of Funnelholic Media.  Craig works with companies to design, build, and optimize their Demand Chain Strategy.  What is the Demand Chain?  Whereas the supply chain which has repeatable, metrics driven processes that deliver products on time, the Demand Chain is a systematic process built to predictably deliver/over-deliver revenue on time.  Craig helps companies with their overall Demand Chain strategy and advises them on the critical components such as online marketing, demand generation, social strategy, content marketing, inside sales, and sales processes.  

Craig speaks frequently at both live and virtual conferences and other events on a number of b2b sales and marketing topics.  He also contributes to e-books, webinars and a range other digital content. Many in the industry also know him as The Funnelholic. On his popular blog, Craig waxes poetic on topics of interest to those who live and work in the B2B Demand Chain from the top of the funnel to close.

 

Advertisements

Old School Marketing is Sexy, Social is a Flirt

The following is a guest post by Scott Mersy, Senior Director of Marketing at ServiceNow (NOW).

As a veteran of high tech marketing from B-DC (before Dot-Com) to today, I’ve witnessed the “death” of many a marketing tactic. We’ve all seen numerous proclamations that “email marketing is dead!” Meanwhile, it remains the bread and butter of virtually every B2B marketing toolkit.

Today, there are hundreds – if not thousands – of blogs touting social media and inbound marketing techniques, almost to the exclusion of everything else. Nothing else matters, it seems. Just create great content, seed it where your buyers are, drive them back to your web site to get more super content, and watch the dollars roll in!

“Social Marketing” is certainly a critical piece of the B2B marketing puzzle. It’s one of the best channels to reach potential buyers with your messages, entice them to interact with you, and develop a relationship. However, B2B enterprise solutions are not to be bought via a shopping cart and with a credit card.

Social is a start, but nothing replaces the magic that happens when a compelling, complex product that solves real (and big!) business problems meets face-to-face marketing and sales engagement. Social can start a relationship and help sustain it, but truly sexy enterprises understand that the heavy lifting gets done by a strong sales team armed by a  marketing organization that “gets” field marketing.

These organizations lean on another tactic that “died” in 2001. However, unlike Webvan and other Dot-Com busts, event marketing is back and stronger than ever. There are more trade shows, conferences, meetups, seminars, workshops and forums than ever. Strong enterprise marketing organizations are taking those flirty social relationships developed with prospects online and driving face-to-face engagements prior to sales calls. Demoing the solution in person, answering specific individual questions that come up as a result of seeing and hearing what’s possible, and bringing current happy customers to the mix verify what’s said has much more power in person than online.

While tons of information exists online, nothing beats looking someone in the eye and connecting with them on ways to solve a business problem. When marketing helps drive deals by enabling field-based face-to-face engagement, that’s chemistry.

About Scott
Scott Mersy is a marketing leader with more than fifteen years experience, including the last twelve marketing enterprise SaaS and Cloud solutions. As Senior Director of Marketing at ServiceNow, Scott leads marketing efforts driving lead generation, field marketing, event marketing, and channel marketing. As Vice President of Marketing & Products at Genius.com, Scott helped develop and launch the company in 2004. He subsequently defined and delivered five products to market from 2005 – 2010. Scott led demand generation and marketing operations for web conferencing pioneer WebEx from 1999 – 2003, initiating many of the revenue-focused marketing processes now defining B2B marketing. Scott honed his skills during two years developing online marketing at Oracle and five years at Carlson Marketing Group. Scott holds an MBA from the Fuqua School of Business at Duke University.

Bill Wesemann: Sexy Has Come Full Circle

Silicon Valley veteran Bill Wesemann knows sexy. With over 30 years experience, Bill has done it all, from selling computing services in the pre-PC era, through running worldwide sales working for Steve Jobs at NeXT and an IPO at Genesys, to angel investing and advising today. Below, Bill shares his insights on how delivering and selling enterprise software has come full circle, as well as a surprising story about the darker days at NeXT.

How did you get started in technology?
“In 1981, I was a pitcher in the San Diego Padres organization in need of surgery.  (By the way, the lifestyle of a minor league baseball player is similar to working for a startup.  You sleep when and where you can, and if you win that night’s poker game, you upgrade to the buses’ spacious overhead luggage bin.) Waiting in the doctor’s office for my surgical consult, l picked up a copy of Forbes with an article that changed the course of my life. It featured the Top 20 information services companies, among which were several big players selling computing capability directly to end users, including Tymshare.  I decided on the spot that was my next step and before too long I’d landed the job I wanted in sales.”

What has changed since the sexy pre-PC era?
“What I find really interesting is what was sexy at the start of my career in the early 80s has come full circle.  What made Tymshare and its competitors so revolutionary was that the buyer was the end-user and didn’t have to be hardcore programmers to use our service.

Just prior to corporate adoption of the PC, Tymshare offered “fourth-generation” software that allowed analysts to quickly develop applications and empower the end user.  In addition to owning the X.25 packet network called Tymnet, Tymshare also had early versions of email for which we charged $0.25 for every 1K characters.  Can you imagine that cost structure today? Needless to say, with an uncapped pay-as-you-use model, the bills got very big, very fast. As companies struggled to contain costs and set standards, a new regime run by the freshly-created Director of MIS, emerged.  With increased PC adoption, early versions of fixed-price packaged software, and solutions moved in-house, the model unraveled. In 1984, Tymshare was sold to aerospace manufacturer, McDonnell Douglas.

Fast-forward 30 years, and with the advent of SaaS, cloud technologies, social, and mobile, and the end users are once again discovering their own solutions. With today’s multi-tenant SaaS architecture, the ability to deliver cloud services anywhere to any device, and cost-effective per seat or pay as you go pricing has taken the enterprise software industry by storm. As vendors like Salesforce.com have shown, it is more cost-effective, scalable, and flexible to use on-demand could-based software.  So we have come full circle, only this time the economics favor cloud-based applications.”

What’s sexy today?
“I think the rise of angel investors in the past decade has been very good for enterprise all around. Early stage investors can not only participate in advance of seed rounds, but can contribute more than money. Not only can I share domain expertise, but I am also a partner and true fan of the business and the founders.  While the interests of traditional VC models and what is best for the business can sometimes be at odds, angels can be more patient and understanding of the ups and downs inherent to an early-stage company. Because we can become personally involved with the business, I believe this trend will continue to have a huge impact on the success of a startup.”

You know this post wouldn’t be complete without a Steve Jobs story, right?
“Well, I figured.  Let me quickly back up to the time just before I went to work for NeXT and set the stage for a classic Steve story.

When Windows 3.0 put a GUI on enterprise applications, people could actually use them – talk about sexy for the enterprise!  Before applications were natively built with a GUI (think PeopleSoft in the late 80s), we sold tools to augment mainframe applications with a Windows or OS/2 GUI. I sold one of those companies, Viewpoint Systems, to KnowledgeWare, a computer-aided software engineering (CASE) company whose CEO was none other than hall of fame quarterback Fran Tarkenton.  When I joined NeXT, I went from working with a CEO who knew everything about sports and nothing about software to a CEO who knew everything about software and could care less about sports. Talk about 180-degree change!

I mention CASE because it sets the stage for a classic Steve Jobs sales call story.  You see, NeXT sold enterprise application development software, so he actually had to go on sales calls.  This particular meeting was a big one with the US Postmaster General. There we are in a room in Washington DC, 20 guys in suits and the two of us (Steve clad in his classic uniform, of course).  Their very first question was, “Steve, can you tell me what you think of CASE?”  I cringed, and a full 30 seconds of silence passed.  Steve then pretends he’s going to sneeze and says into his hand as loud as he can, “It’s bull shit”. I cannot describe the stunned looked on their faces. Another 30 seconds of awkward silence passes and I say, “Next question?”  I’ve got so many of these great stories, but we’ll save them for a future post.”

What did you learn working for Steve Jobs that applies to entrepreneurs today?
“I will say the time I worked with Steve at NeXT were tough times for him. Some had started to write him off and he was struggling to find himself.   Even through the darkest days, the only time I ever saw him really down was when he briefly decided to give up the user experience and adopt the Windows GUI over the beautiful object-oriented interface we’d developed at NeXT.  Obviously he ultimately didn’t have to do it, but he almost conceded.  It was his spirit and relentless drive that never allowed him to give up.

I believe that those that were fortunate enough to work for Steve at any point in time are the better for it. I have had the privilege of working for many great companies, but I look back at those days as the best of my career.  We worked every day with a singular goal of doing something unique and contributing to something special.  It may sound trite, but that type of culture and unwavering dedication makes financial rewards secondary.   We got up everyday to hit a grand slam.  We weren’t satisfied with a base hit and we never gave up.   I think this is an important lesson for any entrepreneur that faces the fire, you’ve got to double down on faith and push forward.”

About Bill 

Bill Wesemann is a Silicon Valley veteran with over three decades of experience in enterprise software. He began his career in technology in the early 80s selling computing services in the pre-PC era with several successful exits. In the 90s, he ran worldwide sales for NeXT, led sales at Genesys, which went public 1997, and was then CEO of NextPage.  For the past decade, he been an angel investor, advisor, and on the Board of Directors LivePerson (LPSN).  

 

seXML and Business Integration (what your parents didn’t tell you)

The following is a guest post by Jason Ouellette, CTO and Cofounder of SocialPandas.

My first startup job was as a junior engineer at webMethods in 1997. If you’re the kind of person who judges the passage of time by JDK version (and c’mon, who isn’t?) that’s the JDK 1.1 era. Although the details varied over the years, the mission of the company can be found in its camel cased name: to bring programmatic access to the web. The two technologies it used to do so: XML and HTTP. I’m going to jump into XML here because nothing says enterprise and sexy like XML.

XML had been proposed by the W3C as a kinder, friendlier replacement for SGML. Their XML 1.0 standard was structured, self-describing, “strongly-typed” and cognitively more accessible. The two founders of webMethods were excited about XML and its potential value in business integration, fanboi-level excited. They participated in standards bodies, conferences, and encouraged employees to contribute to new, related standards like XQL (XML Query Language, precursor to XPath). They even placed XML at the spiritual heart of our first product in the form of WIDL: Web Interface Definition Language, an XML dialect that described an API layer for CGI forms on websites. Or, in the interests of Keeping It Real: a language for writing web scrapers. However unglamorous it sounds, it made an impressive demo to ask the webMethods tool to examine a web page, build an API around it (like CORBA IDL, we would say enthusiastically), test it, and end up with a tidy, reusable XML description of the whole mess, importing the functionality of that website to any program.

A few months into WIDL we found that “Web Automation” (yet another euphemism for web scraping) was sadly not the Big Idea upon which we would grow big and rich like Netscape. No, we needed something less brittle and with more meat than the DHL and FedEx package tracking demos. We found it in B2B, namely Business-to-Business e-commerce. Using XML over HTTP we set out to improve the state of the art at the time, which was EDI (Electronic Data Interchange) documents over the VAN (Value Added Network). In comparison with the open and democratic interwebs, the VAN is a shadowy underworld of leased lines, arcane protocols like X25, and handshakes involving data formats that only a COBOL program could love.

A quick sidebar on EDI: In those ancient times of relative CPU and network I/O scarcity, many data formats and protocols were lean and mean, quite unfriendly to humans. They were optimized to live in the virtual space between computers, and space was tight. Some examples from the distributed computing wing of the IT museum: CORBA IIOP, COM/DCOM, and much higher up the stack, the ANSI X.12 and UN/EDIFACT family of EDI formats. If you’ve ever seen an “850” document you know it looks like petrified dino dung, but fixed-field documents like that are still hugely important today, helping businesses to exchange structured business information system-to-system, such as purchase orders and invoices.

In contrast to EDI, the human readability of XML business documents was one of its selling points, or so I observed on webMethods sales calls. It was not uncommon for raw XML to be shown in slide decks and demos to business people. While the IT folks in the room grumbled about its piggish appetite for memory and other computing resources, the less technical were transfixed with the beauty of its angle brackets. Fake but pretty purchase orders like this were often trotted out:

In addition to being transparent in a way that binary and fixed-field formats are not, XML documents can be validated against a Document Type Definition (DTD), the lightweight precursor to the more full-figured XML Schema specification. So before processing your purchase order for “Tasty XML Vittles” you can verify programmatically that it’s well-formed and will not break your e-commerce back-end (written in NetDynamics or some other cool web application technology of the day).

This was all sexy stuff back then. Many industries adopted XML dialects for e-commerce, like cXML for procurement and RosettaNet for high-tech manufacturers. webMethods sold lots of product built on the premise of XML document exchange over the Internet, went public (with its lovely WEBM ticker symbol), suffered Bubble Burst 1.0 (like $4B market cap one day, threats of Nasdaq delisting the next), and sold to Software AG for over $500M. XML went on to have a prodigious number of children, most with voluminous specifications, names like WS*. SOAP and Web Services live on today as the most mainstream incarnation of XML.

But like wholesome mid-century American family values, we still pine for the idealized simplicity of early XML. JSON (JavaScript Object Notation), a militant branch of the document simplification movement, has been sexy for a while now. I wonder what will come next, when JSON begins a course of Botox injections. That’s one of the fun parts of being in this industry. Knowing your history is optional, and you’re doomed to repeat it with faster machines.


About Jason

Jason has always preferred computers to people; so starting at age 6 he was coding Commodore BASIC and 6502 assembly. As Chief Architect at Appirio, he wrote three of the most popular apps on Salesforce.com’s AppExchange as well as a book for developers about Force.com. At data virtualization vendor Composite Software, Jason led R&D efforts to build connector products for SAP, Siebel, and salesforce.com. As a founding engineer at webMethods (now Software AG), he developed the industry’s first XML-based B2B integration server. He has a B.S. in Information & Decision Systems from Carnegie Mellon, and graduated summa cum laude from the San Francisco School of Home Renovation Hard Knocks in 2009 with his thesis, “The Information Asymmetry of Milestone Payments.”

 

It’s time for me to confess…

I think enterprise software is sexy as hell.  There, I said it. I think creating value that customers will pay for is extremely hot. A recurring revenue stream makes me giddy.  And nothing, absolutely nothing, turns my head more than profitability.

Why is enterprise boring by definition?  How can improving or changing the way people do business not get you fired up?   Even when I was a noob to the Valley, I still preferred business over consumer. Maybe it’s just because I don’t understand consumers or I don’t want to fall prey to their fickle nature.  Maybe I really am just old and boring and can’t accept it.  Or maybe it’s because I grew up in the age of SaaS.  At my first startup in 1998, we didn’t even know what to call it. We said, “Um, it lives in your browser.” [Blank stare.]  “You can log in from any computer, even from home.” [Furrowed brow.]  Our incumbent competitor wasn’t just premise-based, but kiosk-based, so it was a mind-bending concept for our prospects to grasp. At some point these magical services became ASP, then on-demand, then SaaS, and now we’re all happily living in the cloud – until the next rebrand.

The inspiration for this blog came after reading a great article in TechCrunch where Alexander Haislip explains that the model to follow is not Instagram, but companies that have “real intellectual property, obvious monetization and a plethora of cash-rich potential acquirers.”  I loved Alex’s contrast on the statistical exit probability and valuations of consumer and enterprise markets…. but it was the reader comments that hooked me. It was a lively debate and I’d wager I could guess the age of each commenter within 5 years.  And then I found the one that struck a nerve, “God in Heaven, I don’t know ONE techie who WANTS to build that crap!”

Crap? Really?

As I sat ranting in my head about how these SoLoMo app building, Red Bull drinking, freemium loving, hoodie wearing twentysomethings don’t have a freakin’ clue, it hit me – I am a complete hypocrite.  I cannot count the number of times I’ve turned up one side of my lip while emitting an audible sound of disgust at the thought of working for a global, lumbering, legacy enterprise like Oracle or Cisco. How could that enterprise be my enterprise?   I realized that, just as the newest generation of entrepreneurs and enthusiasts have little understanding of what’s come before them, I’ve completely failed to pay homage to all that came before me. … and what those companies did to empower our generation to build the next great thing on top of their achievements.

When I joined the “dotcom” ranks, we were revolutionizing the world with “the Internet,” turning tradition on its ear, changing the way the world communicated, and had zero respect for anything that got in our way.  In hindsight, it’s clearer to me that while all of that is true, we owed that opportunity to the trailblazers that made our revolution possible.  Without the on-premise and client-side software providers, what improvements would we have had to offer with our fancy new SaaS-iness? Without the hardware, database and communications infrastructure, what would we have built upon? The big boring behemoths are behemoths precisely because our world can’t run without them.  Remove that infrastructure and our apps, enterprise or otherwise, grind to a screeching halt.

I’d also venture to say that this generation’s arrogance is completely justified.  Social and mobile are absolutely revolutionizing how the world connects and interacts.  It did, however, take a lot of once-alluring hardware innovation and uber-sexy enterprise (and consumer) software to get here.

Thankfully Aaron Levie has declared enterprise is sexy “again” (twice!). And even if Dustin Moskovitz and Drew Houston haven’t explicitly declared their infatuation they (along with others) have certainly done it in deed. Yes, fanboys, someone can voluntarily leave Facebook for enterprise without dying of boredom. And just for the record, I love SoLoMo apps, Red Bull and hoodies.  Just don’t get me started on freemium unless you’re ready for an earful. It’s a topic for an upcoming blog.

Here’s my point: From mainframes to mobile, everything that has value was sexy at some point, even if that’s no longer the case.  This blog will feature interviews and guest posts from everyone along the way.  Tales from the trenches, lessons learned, and a timeless perspective on who and what has contributed to creating the industry I love.

Wanna share your sexy story through a guest post or interview?  Let me know in the comments or connect with me on Twitter.

Special thanks to David “The Punctuation” Gleason for his Wikipedia mind, colorful insight and masterful editing prowess.