
Fred Wilson Calls Out Enterprise Tech Incumbents, Sees Room for NY Startups - robertbud1
http://www.xconomy.com/new-york/2012/12/19/fred-wilson-calls-out-enterprise-tech-incumbents-sees-room-for-ny-startups/
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mbesto
_“If I could short the entire big, fat, old, cynical, rip-off artist
enterprise software business, I would,” he said. “They’re not innovating.
There’s nothing that those big companies do that’s really any good. The caveat
is it takes forever to rip out those systems.” The half-life of enterprise
software, he said, is often longer than desired, making it difficult for new,
replacement technology to gain a foothold._

Curious - what vendors is he specifically talking about? If he's insinuating a
company like SAP, I'd beg to differ. I'm not a huge fan of what SAP does (and
I work in the space), but the reality is that there are MANY companies who
rely on them to do fairly straight forward operational things (such as
Finance, Accounting, Materials Management, etc). Additionally, SAP _is_
actually trying to rip out it's own infrastructure and get all of their
customers on SAP HANA. They've put MASSIVE money (I would argue billions)
behind marketing and selling it and even then they are finding enterprise
customers slow to adopt.

To put this in perspective, they have a install base of roughly 10,000
customers on SAP BW (their data warehouse product) and have managed to get
around 500 customers on SAP HANA in roughly 2.5 years. That's only 5% of their
own market.

In case anyone is interested in understanding more about this, feel free to
ping me directly. There's a lot more to the enterprise then it just "being
old, cynical, and fat". I'm also writing a book on it.

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w1ntermute
I don't have personal experience with SAP, but I have a parent who does, and
from what I've heard, it's a nightmare. It's expensive, has lots of problems,
is very inflexible, etc.

But none of the things it's being used for are very programmatically
complicated (inventory management, sales, etc.). The software is just buggy
and slow. The SAP "consultants" cost an arm and a leg and are near worthless.

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dave_sullivan
There's a lot more to enterprise than being "big, fat, old, cynical, rip-off
artists". It seems like a lot of people are underestimating the sales/decision
cycle of the enterprise market and the effect this has on costs.

This model of the consumerization of enterprise where users will just come and
sign up has been far from proven at this point. People keep talking about
"disrupting the enterprise space" but it's really a very conservative space.
People with regular jobs tend to be very risk averse (in my experience). They
don't want to make the wrong decision, and are willing to spend a lot of money
and TONS of time to try to mitigate that risk. They also have _lots_ of weird
little requests re: functionality, so enterprise products kind of do need some
kind of platform around them that allows heavy customization (and that takes
tons of time to develop).

So, while I certainly agree there's plenty of money to be made in this
business, I'm finding it more and more unlikely that a truly different
business model is the way to go about making it.

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amorphid
As a recruiter, I can comment on the state of recruiting software. All
recruiting software sucks. I've never meant anyone with.the right combination
of aptitude, perspective, resources, and moxie to build something I would care
to use on a daily basis.

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bernardom
How could there not be room for innovation there? Anyone who has used SAP can
see that.

A few years ago, one of my clients in an oil plant was trying to find parts (a
certain type and size of carbon-steel pipe). They were on SAP, and all
inventory was logged by the maintenance people in the various plants in this
complex. The guy had to try inputting every combination of "3' diameter steel
pipe" into their 90s-esque interface because they hadn't standardized the
parts names.

3 foot, three foot, three ft, di, diameter, etc.

Is that SAP's fault? Well, I suppose it could have been avoided with training-
training every single maintenance guy in a huge complex to standardize the
name of every single part.

What bothers me isn't that they didn't solve that specific problem- I'm sure
it happens everywhere. But 'implementing SAP' is a multibillion dollar
industry because it's so configurable. There has to be a better way. (I've
heard mixed things regarding OpenERP in this forum)

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jasonkolb
Ok so I live, eat, breath, and drink data, and I'd never heard of a "data
network" before, other than as the thing that connects computers together. Is
this some new buzz word I'm unaware of?

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zt
I work in civic technology, and one could easily rewrite this to say:

“If I could short the entire big, fat, old, cynical, rip-off artist
[government] software business, I would,” he said. “They’re not innovating.
There’s nothing that those big companies do that’s really any good. The caveat
is it takes forever to rip out those systems.” The half-life of [government]
software, he said, is often longer than desired, making it difficult for new,
replacement technology to gain a foothold.

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loceng
You'll know what companies are leading innovation by how much they get done,
how broad they go, how big their ecosystem or breadth becomes. Apple is a good
example, Google too. Mind you, these are both massive companies so they have
tons of resources to put towards innovation - so they may not actually be
doing a very good or efficient job, but they're able to ship.

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teamlaft
Hi guys, I'm the organizer of the NY Enterprise Technology Meetup
(www.meetup.com/ny-enterprise-tech). It was a great talk, and Fred shared a
lot of relevant feedback for entrepreneurs working on enterprise technology.

Here is a video of his keynote for anyone interested:
<http://youtu.be/k_ZpbESDkAc>

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bigtones
He doesn't call out any Enterprise Tech Incumbents at all. We're all left
guessing - making this entire article complete hyperbole.

