MOUNTAIN VIEW, Calif. — The buying power in technology has shifted to software developers and away from operations, and that means major changes up the entire supply chain, according to Martin Casado.
Now a venture capitalist with Andreessen Horowitz, the Nicira founder and former VMware executive has been on the front lines as software-defined networking (SDN) has emerged. More than that, he’s seen the changes that a software-driven world is causing, with experience both as a supplier and a buyer.
It’s a far cry from his first job out of college, “working in a national lab doing computational physics,” he said during a keynote at the OpenStack Days: Silicon Valley conference yesterday.
In those days, he was at the mercy of the IT department. “I didn’t have budget for a pencil,” he said. “I didn’t even have root access on my machine.”
Now, developers rule.
“They control a lot more of the budget than they have in the past,” he said. “Their buying methodology is so different. They don’t care so much about analyst reports. They don’t care so much about certification and training.”
What this means is that smaller vendors have a more even playing field. Getting cited in analyst reports, getting certified to sell to a big customer, getting the attention of buyers — these are all easier for big vendors with their large budgets, enormous staffs, and literally decades-long relationships with customers.
“In the past, it’s been very, very difficult for startups to actually get access to the customer in a meaningful way,” Casado said.
Developers want to cut to the chase; they want “low friction to buying,” he said. They’re happy to ignore the trappings of the old sales cycle, and that’s advantageous to the developer-centric startup.
Take a look at companies like Waze, which sprang up overnight to become a billion-dollar (almost) Google acquisition. Waze and its mobile-app brethren take advantage of a supply chain that’s been simplified; thanks to smartphones, they can put themselves directly in a customer’s hands. Tech startups, through open source technologies and this new developer-driven world, have a similar opportunity.
“This, more than anything, is going to shape what the industry is going to look like in the next two to five years,” Casado said.