
Lecture 12: Building for the Enterprise - kqr2
http://startupclass.samaltman.com/courses/lec12
======
soneca
One of the required reading is his own praising profile? And then he starts
the video with a theme song??

Am I supposed to learn from him or worship his personality?

EDIT: I finished the video. Here is a too long; didn't watch as asked.

The first 18 minutes he is telling Box' history and justifying its existence.
The first advice come at 7:40 - pay attention of the technological changes
that are happening in the world.

He try to sell you the idea that is better to do business with enterprise
because there is more money on it. Kind of the opposite as advised before
about why to start a startup. And even the numbers he shows are shady. He says
there are only two ways to make money on consumer tech. Consumers paying you
or advertising. That sums up to a total 170 billion dollars market. Note that
he leaves Apple and all sort of consumer tech that is not ads or mobile apps
purchases. And then he compares that with corporate IT market of 4.7 trillion
dollars. But here he includes servers and all infrastructure. Very shady sales
technique comparig apples to oranges.

Then at minute 21 he finally cuts the bullshit and start to deliver content.
Great content by the way. Worth watching after minute 21. If only he wasn't so
Stan S. Stanman at the beginning.

~~~
7Figures2Commas
There was useful high-level content in this video, but anyone who is serious
about building for the enterprise should definitely study other enterprise
SaaS companies. Box's financials, on the surface, are comparatively
unimpressive and some of them even raise questions about the company's long-
term viability[1][2]. Some folks argue that Box is in better shape than it
might appear to be in[3], but this is based on assumptions which may or may
not prove to be valid[4].

[1] [http://kellblog.com/2014/03/27/burn-baby-burn-a-look-at-
the-...](http://kellblog.com/2014/03/27/burn-baby-burn-a-look-at-the-box-s-1/)

[2] [http://tomtunguz.com/box-ipo/](http://tomtunguz.com/box-ipo/)

[3] [http://www.businessinsider.com/heres-why-boxs-aaron-levie-
is...](http://www.businessinsider.com/heres-why-boxs-aaron-levie-is-a-
genius-2014-4)

[4] [http://kellblog.com/2014/05/15/the-box-s-1-delayed-ipo-
and-t...](http://kellblog.com/2014/05/15/the-box-s-1-delayed-ipo-and-the-
genius-of-tien-zuo/)

~~~
ghuntley
re: "but anyone who is serious about building for the enterprise should
definitely study other enterprise SaaS companies"

Can recommend [http://www.forentrepreneurs.com/saas-
metrics-2/](http://www.forentrepreneurs.com/saas-metrics-2/) as a good
starting point.

------
mindcrime
I hate content like this on HN[1].

Please, let all the Stanford kids building startups go after the consumer
space... the world _needs_ more solomo-dailydeal-catpicture-ridesharing-
airbnbForX apps. What it doesn't need is any more vendors selling software to
businesses, who, you know, actually pay, like, money, for software.

No, really, I mean it. There is absolutely _NOTHING_ interesting about selling
enterprise software. It's boring, dull, unexciting, unprofitable, gives you
bad breath, causes cancer, kills puppies, and is bad for the environment. If
you are thinking about an enterprise software startup, forget it. No joke.
Really. Just. Don't. Do. It.

[1]: _Because I 'm greedy and don't want more competition!_

------
api
My trouble with the enterprise has always been that they tend to lag when it
comes to adopting new ways of doing things. As a result, if you listen
slavishly to what enterprise customers tell you to build you'll be building
solutions to yesterday's problems or technology for yesterday's ecosystem.

I've found more recently that this isn't always true, and it really depends on
what sort of enterprise you're dealing with. Bottom line is you can't listen
mindlessly to what customers say-- you have to think about the plan/vision and
the where the overall market is going.

~~~
borski
This isn't quite true.

Enterprise knows what their problems are, and you should listen to them
slavishly. The issue comes in when you listen to them for what solutions to
build for their problems.

They don't know what the right solution is, but they do know what the right
problem is. If they knew what the right solution was, you wouldn't have a
(good) business.

In finding the solution, you will sometimes address a problem enterprise
wasn't even thinking about, but is much larger and solves their initial
problem as well.

We ([https://www.tinfoilsecurity.com](https://www.tinfoilsecurity.com))
started as a website security scanner - we're now a developer-focused website
security scanner that focuses on DevOps integrations and automating the
testing process earlier, rather than later. Nobody would have asked us to
build that (nobody did), but that is what sets us apart and why we're beating
our competitors.

~~~
fsloth
"Enterprise knows what their problems are, and you should listen to them
slavishly. The issue comes in when you listen to them for what solutions to
build for their problems."

So very much true. In the company I work for this principle applies to inhouse
development as well. I.e the problems are obvious but the solutions not so
much. We are an independent software vendor, but ownership of code is so
scattered that essentially a huge portion of development is handled as if it
would be done by external service providers - i.e. the driving force in
development is business who know exactly what the pain points are but would
want only quick hacks.

Except, those pain points are so acute that if there are ready solutions
available they will authorize purchases of ridiculous amounts of cash to have
them solved. I imagine this is the situation in most businesses.

Now, out of those problems some are really hard to crack, while others are
just an artifact of lack of inhouse knowledge of the particular technical
field. Those consultants that manage to offer viable solutions for these well
known problem domains probably can earn their bread quite nicely.

------
fidotron
One of my favourite points about big business is in here, and it applies
equally well if you're a startup selling into a company or if you already work
there.

These people are not looking for the lowest cost option, they're looking for
maximum upside. Don't get stuck in a situation of selling incremental
improvements with reduced costs, but work out how to spend the same you do
today (or more) and get more back for it.

------
jonalmeida
I'm fairly new to enterprise software development, but I do know that I really
like working with customers that are almost always smart and/or know what they
want.

The more companies that move to an agile work flow the better enterprise
software development will become.

IMHO, I don't get the same enjoyment from consumer-facing projects.

------
rsobers
According to Levie, Box has 99% of the Fortune 500. Does it really count if 75
people in Toyota's marketing department uses Box to share a few hundred
gigabytes of files?

The numbers don't lie: "Box’s average customer value (ACV) is $3,653, much
lower than the median of 59,600." [1]

They're selling "enterprise" software at SMB price points.

Setting aside security concerns, getting a big enterprise to move a
substantial part of their IT infrastructure to the cloud is a logistical
nightmare. Perhaps they underestimated this.

[1] [http://tomtunguz.com/box-ipo/](http://tomtunguz.com/box-ipo/)

~~~
benchmark6
Is this supposed to be feedback on his talk? If you watched, Levie is
implementing his own suggested wedge strategy.

------
rajens
I would've hoped for less about Box's story and more focus about building an
enterprise software company, but he did touch on some areas towards the latter
half of the lecture. I summarized about 32 quotes (primarily for the latter
half of the lecture) here: [https://medium.com/how-to-start-a-
startup/32-quotes-from-aar...](https://medium.com/how-to-start-a-
startup/32-quotes-from-aaron-levie-on-building-for-the-
enterprise-c4b90b82bd0d)

------
jeffmanu
What's interesting about Box is that they've succeeded to charge enterprise
clients with a service that should be a commodity by now. They've also taken
the route of graduating consumer interest into enterprise use. Their quick
advance into mobile was good thinking.

------
edman
Can someone write tl;dr of the video?

------
notastartup
As a freelancer, how do you find a customer to build a solution for?

