In the latest chapter of my one-man quest to avoid all the glamour associated with working in the City, I spent last week at a Business Intelligence summit on the outskirts of Munich.
The dreary weather fit well for a city that felt like it was still in the jaded aftermath of Oktoberfest, despite which it was still sausages and strudel over cocktails and canapés.
The talk of conference was a young firm called Tableau. Founded by a couple of Stanford PhD students and their advisor, Pixar exec Professor Hanrahan, they have revolutionised the analytics market with their “self-service data discovery” software.
Tableau is like Excel on steroids, with visualisation at its heart.
Tableau taking over
Formerly the domain of the software giants SAP, IBM and Microsoft, BI has been turned on its head by Tableau’s intuitive tool. A firm that started with a free desktop download is now a gold sponsor. Shell has 12,00 users.
Industry analysts were drawing analogies to 1993 and the first internet browser. And IBM has had to turn to its supercomputer Watson just to get some attention.
Zendesk is a similar company, in many ways. They offer sophisticated customer service software for any firm, any size. They are starting to move upstream and winning large accounts against Oracle and salesforce.com. Salesforce themselves used a similar strategy in CRM tools in the noughties.
Are the tables turning?
Cloud is awesome; startups are awesome; we’re in the age of ‘Davids’ everywhere and the big guns watch out. Right?
That may all be true, and there is no doubt these companies are a testament to innovation and the process of creative destruction.
But that is somewhat zero sum in its analysis. The pie is the pie, and anyway it’s not my point.
The democratisation of software
No, what’s interesting here is how these tools are, for want of a better term, democratising software.
Because off-the-shelf software is still expensive. Costs for Business Objects analytics software and IBM Tivoli customer service suites can run to tens of thousands of dollars, and therefore remain the exclusive purview of large companies. Even the cost of Office makes many people baulk (and steal).
Today however, a day-zero one-person company that has a dream of selling wearables for hamsters can launch with business-grade CRM tools (Salesforce.com), customer service (Zendesk), analytics (Tableau), accounting (Xero) and countless others.
Pie for all
Targeting the long tail of underserved SMBs, which they can monetise as their customers grow bigger, is a smart move. Like eBay, Amazon and iTunes found the first internet era, this tail can be significant. In 2008 a study found that 37% of Amazon’s book sales in the tail. In a $400 billion global software market that is a lot of extra pie.
And they provide fuel for start-ups to grow that much quicker. Start-ups helping start-ups.
At its huge Sapphire customer event this year, CEO of German software leader SAP, Bill McDermott quipped: “In the nineties and noughties, everything [in software] was best of breed. Well they may have been the best, but they sure didn’t breed.”
A few more Tableaus and he will end up eating a different sort of pie.