Why Startups Win Over The Large Software Vendors
My post What's Next For Social Software Startups sparked a great deal of feedback both positive and negative. I received a flurry of responses ranging from "spot on" to "why would you say that!" So I want to be clear, I don't think startups are a bad choice at all. I was simply trying to assert that the large software vendors (LSVs) are no longer lagging years behind when it comes to social software (Microsoft being the exception). However, they are many reasons that Startups still have an advantage, such as:
1. They care about you. In many cases your business may mean more to a smaller company than it does to a LSV. A $100K deal may be significant for a startup while an sales person at an LSV may not even look at deals of that size. This often translates to better support, for example delivering your feature requests quite quickly.
2. Frequent Releases - While some LSVs have been able to reduce their release times from 18-24 months down to 6-12, they still don't match the quarterly or monthly releases that most Startups crank out.
3. Quickly Adapt To Trends - Things change quickly and the next great idea could pop-up any minute. Startups are often able to adapt their plans to incorporate the latest and greatest ideas, while LSVs require months of product management meetings to even start planning their roadmaps, let alone deliver new code.
4. Don't Push Their Own Agendas - One of the biggest complaints I hear about LSVs is that their plans are not customer driven but instead push their own agenda. They often tell customers what would be good for them instead of listening to what the customers are asking for. Examples are trying to sell specific hardware, services or additional products from their larger software portfolio.
5. Image Is Everything - Sometimes perception and image mean more than features or pricing. Some customers simply want to go with "the new cool kid on the block" vs. "an old established player."
I'm still sticking to my belief that as social software has become more mainstream and companies are rolling out solutions company wide, the LSVs may have an advantage in security, scalability, compliance, etc. I also don't see the feature gap (specific to collaboration) that existed a few years ago, as the LSVs have been able to create some pretty compelling solutions this year.
Bottom line is there are always advantages and disadvantages when choosing a vendor, and no one right solution fits every customer.
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1. They care about you. In many cases your business may mean more to a smaller company than it does to a LSV. A $100K deal may be significant for a startup while an sales person at an LSV may not even look at deals of that size. This often translates to better support, for example delivering your feature requests quite quickly. 2. Frequent Releases - While some LSVs have been able to reduce their release times from 18-24 months down to 6-12, they still don't match the quarterly or monthly releases that most Startups crank out.
3. Quickly Adapt To Trends - Things change quickly and the next great idea could pop-up any minute. Startups are often able to adapt their plans to incorporate the latest and greatest ideas, while LSVs require months of product management meetings to even start planning their roadmaps, let alone deliver new code.
4. Don't Push Their Own Agendas - One of the biggest complaints I hear about LSVs is that their plans are not customer driven but instead push their own agenda. They often tell customers what would be good for them instead of listening to what the customers are asking for. Examples are trying to sell specific hardware, services or additional products from their larger software portfolio.
5. Image Is Everything - Sometimes perception and image mean more than features or pricing. Some customers simply want to go with "the new cool kid on the block" vs. "an old established player."
I'm still sticking to my belief that as social software has become more mainstream and companies are rolling out solutions company wide, the LSVs may have an advantage in security, scalability, compliance, etc. I also don't see the feature gap (specific to collaboration) that existed a few years ago, as the LSVs have been able to create some pretty compelling solutions this year.
Bottom line is there are always advantages and disadvantages when choosing a vendor, and no one right solution fits every customer.
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