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Why isn’t Enterprise software sexy to startups?

So when iOS7 came out last week I was super excited to update my iPhone5.  I pushed the update software button on my phone and was shocked to see that I didn’t have enough memory to actually complete the operation. So I plugged my iPhone into iTunes and was doubly shocked to see I had over 100 applications actually installed on it. How did this happen?  I can almost see past the one-time novelty apps (who hasn’t downloaded the flashlight or songify app?), but realistically there is no way I use even half of these apps every day, at most maybe 5-10.  So I happily purged a ton of useless apps to make room for my new iOS update (side note:  I can’t believe how excited I was for this iOS update, what an Apple fanboy I’ve become).

Now keep this memory in mind and fast forward to the Kitchener-Waterloo (KW) StartupWeekend held recently.  This event has individuals pitch ideas, groups organically form around the most popular ideas, and then the groups work on a minimum viable product (MVP), culminating in a business pitch to a panel of judges at the end of the weekend.  I had the great opportunity to listen to the final pitches, and while I was impressed with the awesome enthusiasm and the hard work all the groups displayed, I must admit I was a bit underwhelmed by the actual business ideas themselves.  Every single group pitched a mobile app idea with a “build it and users will come” business plan.  And the money part?  Well if you have users then obviously you can make money from them somehow? 


Again remembering my recent useless apps revelation, I started to wonder why startups seemed to be so obsessed with the mobile consumer app market?  Are these lucrative business ideas?  Apparently not, according to a recent Forbes article the average mobile app racks in about $4000 in revenue.  What I can’t understand is why startups automatically think of the consumer software space and never the enterprise software space to begin with.  I asked this exact question to some of the younger co-ops/interns I work with and someone replied back that “Enterprise software is not sexy”.  Really? 

Here’s what should be sexy to a startup.  Customers. Better yet, customers who have money to pay you with.  But we’re not talking those that want to pay bargain basement prices.  We’re talking about those that will recognize the value in your innovations and pay proportionate to the business value they receive in return.  Guess who they are?  There’s actually 500 of them, aptly called the Fortune 500. 

SAP Waterloo started as a startup in the enterprise software space (mobile & embedded databases to be exact) before BlackBerry was born.  Our employees are living proof of life-after-startup (and multiple acquisitions for that matter).  And as with any Waterloo startup, we are grounded with unmatched technical aptitude and a certain laidback charm before California cool came from Silicon Valley. Just look around at the other tenants within the David Johnston Waterloo Research and Technology Park (across from UofWaterloo) and see for yourself where viability lies in software.  Sexy is doing innovative work for Fortune 500 customers who recognize the value in your innovations and are not fleeting like those supposed ‘sexy consumers’.  


Addendum:  I apologize for overusing the word ‘sexy’ in this blog posting as someone pointed out it to me it is one of the most overused words in business writing and reeks of desperation.  In my defense this blog posting is a response to someone’s real life comment that used this word first. 

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      Author's profile photo Former Member
      Former Member

      Maybe it's not all about money for those people.

      Some people are okay at earning less but having more fun while working (of course it depends on what is your definition of "fun while working"). When your customers are Fortune 500 companies, one way or the other you'll be tied to their working model, bureaucracy, rules that you don't agree with and legacy technology.

      If you want to work with top notch technology, expressing your ideas, having freedom to try and do things, probably Fortune 500 companies aren't what you find "sexy", as most of them are rather conservative. Plus, there's money to be made providing innovation for smaller business. Maybe people aren't trying to be the next SAP, Oracle, Microsoft or a big consulting company anymore, instead they're trying to be something like the next 37signals.


      By the way, I work for a Top-30 Global 500 company.


      Author's profile photo Former Member
      Former Member
      Blog Post Author

      Interesting enough I attended a local start-up conference and indeed there was a lot of talk about entrepreneurs building businesses not just for the $ but also for the fact that they are designing their own future (and I rather like that expression - designing your future).