Salesforce.com’s Heroku Acquisition: A Clear Stake in the Ground

Dec 25, 2010 by

Salesforce.com, over the past few years, has been reinventing itself as a platform company. IMHO, this is an extremely difficult thing to do for a company who’s cash flow is defined by the CRM market, an acronym that Salesforce.com adopted as a stock ticker. When Salesforce.com first announced Apex, it’s new fangled programming language and pseudo-stack, I took a highly critical stance because it was a clear attempt by a marketing and business team to tackle problems that only technologists can properly understand: building runtimes and frameworks that could provide a foundation for future software in the Cloud. My gripe was that Salesforce chose to create a new language that wasn’t rooted in a development paradigm shift where changes in a programmers ability to express solutions are the motivator, and instead decided to base the language development on seemingly more selfish interests and coupled the languages runtime to their operating and hosting environment. Essentially, they created vertically integrated lock-in, which is terrible for customers and the lack of purer motivations on the language development side produced a sub-par development stack best suited for small add ons.

Now we’re in 2010, and the story is starting to change, and seemingly for the better. At Dreamforce this year, Salesforce.com announced the acquisition of Heroku, the well known Ruby PaaS. Not too long ago, Salesforce.com and VMWare announced VMForce, bringing Java into the Salesforce.com cloud. Salesforce.com’s  evolution seems to be taking it down a path of stack agnosticism. This could be due to good strategic decisions making, or out of an attempt to correct a failed path with Force.com/Apex. Whatever the case maybe, its clear that Salesforce.com is embracing other stacks, and no longer focusing on creating a new $1 billion business by brute force.

It will be interesting to see where Salesforce.com goes with this. Will they make Java officially part of their Cloud by folding up a partnership with VMWare and instead make a Java Cloud their own competency? Might they go after Microsoft’s base by building or acquiring a value proposition that targets .NET developers and attempts to attract that group (who own 40% or so of the development market share) away from Azure? Who knows how far they’ll go, but one thing is clear: the Heroku acquisition clearly signaled that they want to do something different, and that something includes languages and runtime’s well outside of Apex. I really am glad that they’re adding true value and no longer beating the Force.com drum exclusively.

How do you feel about Salesforce.com’s Heroku acquisition? Any predictions on the success or failure?

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Are There REALLY Multiple Strategies for ISVs?

Sep 4, 2007 by

About a week ago I wrote an article on SaaS strategies for existing ISVs, and I see that a a parallel conversation emerged starting with a post by Anshu Sharma that claimed that in the real world, ISVs “…adopt a range of delivery model options to fit the customers need and economics of their particular business.” Phil Wainewright followed up with this post, where he vented about Sharma’s position.

I wanted to post a couple of notes on this little blog battle. First, I think the problem with Sharma’s approach is that it’s strictly customer centric. I’m the first to agree that there are (and rightfully so) a multitude of strategies (as I mentioned in my prior post), but that the decision of which to choose should be a combination of what your customer base wants/needs and what aligns with your company’s future goals and anticipated market shifts. That said, your customer might say “I want on-premise”, but you see that the market is quickly changing, with early adopters going for some new delivery model (SaaS) and its probably only a matter of time before the mainstream market (your current customers) buy into it. If you were to listen only to the customer base, you’d find yourself in trouble in the near future.

If you dig through Wainewright’s post, you’ll notice that he does agree with multiple strategies when it comes to transitioning to SaaS. This is the position I take. None of the strategies I mentioned in my above referenced post are to be permanant. Rather, their purpose is to help an existing ISV make a strategic shift toward adopting SaaS. If Sharma’s intent was that adopting a wide range of delivery models should be/can be permanant, I disagree. That’s asking for trouble when it comes to scaling the business, building new efficiencies, and having a cohesive mission.

Bob Warfield jumped into the battle with this post, where he ends on a note of a “protected game preserve” which is basically a market defined by specific attributes (size of company, etc.) where you are free to play as a SaaS provider, insulating you from the dangers of a head first mentality. This is a smart approach, and is virtually identical to my concept of pursuing a “lite” version of your product that targets a degraded demographic, giving you an opportunity to “sandbox” SaaS while you figure things out.

What do you think? Is it healthy for ISVs to pursue permanent mixed delivery models, or does this create a “dysfunctional family”? 

 

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