Paul Graham from Y Combinator posts a list of ideas that his investment firm would like to fund, and Enterprise 2.0 makes the list at Number 5:
5. Enterprise software 2.0. Enterprise software companies sell bad software for huge amounts of money. They get away with it for a variety of reasons that link together to form a sort of protective wall. But the software world is changing. I suspect that if you study different parts of the enterprise software business (not just what the software does, but more importantly, how it’s sold) you’ll find parts that could be picked off by startups.
That last point — that it’s not as much about what the software does, but how it’s sold — was a huge motivator for us when we started Infovark. One of our most popular posts to date is Emergence in the Enterprise — a rant that was a direct result of me spending far too long as part of the Enterprise Software Sales Cycle.
Power and money are concentrated at the top of the org chart, so naturally vendors want to sell to senior management. After all, from a cost-of-sales perspective, you make higher profits by making only one sale for 12 million dollars than you do making 24 sales for a half million each. That’s surely good for your business.
But the reality is that Enterprise 2.0 can’t deliver much value at the top of the org chart. It’s the process changes and cultural change that delivers value. Unless you can convince the C-Level guys to force everyone else to come along for the ride, the cultural change necessary won’t occur. And as Dean says, if top-down “thou shalt” approaches to change management worked, there wouldn’t be any need for Enterprise 2.0… Enterprise 1.0 would do the job.
That’s why we’re firmly focused at the bottom of the org chart.
(We finally managed to get our product page up — if you’d like to find our more about how Infovark is planning to help, you can check it out here. )