– Box was founded in response of founder’s need to fix file sharing on the internet
– 3 forces contributed to Box emergence: cost of storage dropping dramatically, more powerful browsers and networks, and people wanting to share more and more and from more locations
– after product launched, was in between a consumer product (too many features) and an enterprise product (not enough features)
– consumer looks really fun, enterprise looks really hard. But in consumer space, it’s hard to monetise. Only two ways: people either pay for the app, or you sell advertising.
– to measure the opportunities, let’s look at global market sizes:
$35b = money spent on apps
$135b = global digital advertising
$3.7 trillion spent on enterprise IT per year…
Should you fight with millions of people for a bit of money, or with few people you charge lots of money?
– Enterprise software: building is slow, expensive, complex, and sales process is also very slow (and usually involves an intermediary, which internet people hate)
WHAT HAS CHANGED IN THE ENTERPRISE?
Everything has changed in the past 5 years, most magical time to build an enterprise software company
– on-premise computing -> cloud
– expensive computing -> cheap, low cost computing. Barrier for client introducing a product to their enterprise is lower.
– customised software -> standardized platforms, that the client customises themselves
– large enterprises -> every business can be sold an enterprise software. Makes the market much larger for enterprise software
– regional -> global, people will buy enterprise software from anywhere
– IT-led -> user-led, bring your own devices etc
LOTS OF INDUSTRIES NEEDING NEW TOOLS
– every company needs better, faster, more secure technologies
– retail: will need technologies to reach customers across all channels. No current solution addressing this [totally true, huge but complicated opportunity]
– every single healthcare company needs to personalize its services to the patients, electronic health records, assistance for doctors, etc
– media: from linear to on demand experiences, new forms of distribution and production need to appear. Need for big data analytics for marketing, etc
HOW TO GET STARTED?
– spot technology disruptions: look for new enabling technologies that create a wide gap between how things have been done and how they can be done. Ex: iPad disrupting blueprints management and collaboration, www.plangrid.com
– intentionally start small: start simple and expand over time. What are the gaps in the incumbents solution that customers will want to use? Expand to the larger solution at a later time. Incumbents will overlook you [or buy you if they notice you get traction?]
– find asymmetries: do things incumbents can’t or won’t do because the economics don’t make sense to them, or because technically they can’t.
Ex: software suites have a hard time being on multiple platforms, so go multi platforms [lesser service across more platforms]
– Find the fringe/extreme customers: go after those who are working in the future without totally losing their minds
– Listen to customers, but don’t always build exactly what they want, build what they need
– Modularize (openness, APIs), don’t customize
– Your product should sell itself, but you will still need sales people to help clients navigate the competitive environment and your product