Sharing ideas with the world

Friday, September 30, 2011

The Long Tail Of Startups

7:56 PM Posted by Deepak Nayal No comments
The startup activity has increased a lot in recent years. With many angels, VCs and incubators (such as, Y Combinator and Seedcamp) coming up, more startups are getting the support they require in the early stages. Even though many people generally call them investors, these entities [hopefully] provide more than just money - in the form of required capital, connections and mentoring. 

Tapping The Long Tail 
Even with increased activity in funding and supporting early stage startups, only small percentage of startups are able to get any help from such investors. Unfortunately, a lot of entrepreneurs miss on to the opportunity of getting the required support system for their companies. Media is also almost always generous only to the ones that are linked to some investor, preferably high profile ones. The blogosphere is full of news on such startups. However, there are many other ventures out there that are doing well, but are not lucky enough or do not have the right pedigree to get the required support system and the media attention.

Look around you, most of the SMEs that you deal with in your daily lives were not funded by any angel or VC or incubator in their early stages. These kind of ventures form the long tail of startups. The media does not cover them, we do not hear about them, and most of them die out, few turn into SMEs, and even fewer turn into sustainable companies. I do not have the data to support it but I can bet that the ratio of startups supported by VCs, angels or incubators to the overall number of startups founded in a year is very small. It can be argued that the success rate of the former group is higher than that of the latter, but possibly one of the key reasons that the second group - the long tail of startups - fails more is that they do not get the required help and mentoring. It is quite possible that this long tail will do much better with a proper support system in place; there definitely is a lot of potential in them.

Leveraging Technology
Technology is probably the greatest enabler of all time, and it can play this role for startups as well. It can help us democratize entrepreneurship, and open it up for more people. By its very nature, technology can reach out to anyone, anywhere and anytime, irrespective of their monetary status, education background or work experience. This trait of technology can help us open up opportunities for a lot of entrepreneurs that have not been able to get the attention of investors. There already are services available on the internet that help entrepreneurs with their startups in different ways, such as getting advice (Sprouter), getting funding (Kickstarter), finding investors (AngelList) and finding co-founders (Tech Co-Founder). At a closer look, you will notice that almost all of these services leverage crowdsourcing or [social] networking to provide their service. Services like these make me believe that we can combine the power of people with technology and tap into the potential of this long tail. 

We already are in early stages of doing so. Services, like the ones mentioned above, are available for helping new startups with a particular problem, though we still lack an online entity that acts similar to an angel or an incubator. If we can have open schools and universities, why can we not have open incubators? These virtual startup platforms can help entrepreneurs the same way actual incubators do, only remotely. They can take startups through various stages of funding, provide the required advice, connect with the required people (such as enthusiasts, technologists, marketeers and investors), and even provide platform to offer products and services and partner with other companies. We might have to make our peace with the fact that the success rate of such virtual platform is not going to be as high as premium incubators such as Y Combinator, but the actual numbers will surely be much higher. 

Technology has revolutionized almost every industry and function in the world. It has even revolutionized the act of starting up new ventures (with innovations such as cloud computing and services such as Sprouter and Kickstarter); though, much more is possible. The world of startups has a very long tail, which is mostly [and surprisingly] ignored. Tapping this long tail will not just help entrepreneurs and investors reap monetary benefits but also help the society in general.

[image courtesy of Wikipedia.com]

Monday, September 26, 2011

Information Overload

8:39 PM Posted by Deepak Nayal , 2 comments
[For the purpose of this article, data, information and content will be collectively referred to as information] 

We are all drowning in the ocean of information. Businesses and individuals are generating huge amounts of information everyday. This information can be commercial or non-commercial in nature, such as latest news, price quotes, marketing intelligence, bus routes or info on music shows near your house. We are reaching (at least envisioning) a stage where every single entity around us will start generating information (The Internet of Things).

With more information generated and larger data sets created we already are reaching a state of overload, which is leading to increase in information processing complexity, decrease in the average consumption time (or attention span) and increase in missing out on useful stuff. This problem is not just limited to people, but is also affecting organizations. The good news is that if technology can create this problem, it can solve it too (may be not completely though - at least in the near future).

This overall problem of information overload can be broadly divided into two aspects: Information Discovery and Information Consumption, as depicted in the diagram below. 


Information Discovery 
There is so much information getting generated around us that we miss out on many things. We are not able to discover all the information that we would like to or need to. In the early days of internet there were only a handful of sources that you would tap, and that was pretty much it. This obviously is not the case anymore. In addition to tapping their usual sources, users can and do also utilize other methods for discovering information - 
  • Aggregation - Instead of visiting every possible source of information that they can think of, users can get the required information from aggregators. These aggregators vary a lot in the kind of information they aggregate, which varies from news to movies. Google News, Techmeme, Rotten Tomatoes and Epinions are good examples of such [generic] aggregators, which collect information on a particular topic/area and share it with all users in the similar fashion. Services such as Quora and Hunch have taken aggregation to another level. Hunch asks its user a set of simple questions, answers to which help it understand these users better. Based on that understanding, it shares news and recommendations with these users. Quora asks its users to follow topics of their interest, and then shows them the questions raised by other users in those topics. These services leverage the interest graph to provide better aggregation customized for each individual. 
  • Social Discovery - People are always comfortable using tried and tested things, which is why social discovery is a major way of looking for relevant information. You check recommendations before you buy a book on Amazon.com, prefer watching videos online with highest ratings, look at seller's ratings before buying something from eBay, check out links shared by your friends and family on Facebook, and read the top stories of the day on Digg. Social discovery is a very powerful tool to find the relevant information, and has become even more powerful with the advent of social networking. Companies understand that, which is why the spend on social media marketing is increasing at a amazing rate. 
  • Search - Search is another powerful tool to discover information. People look for different kinds of information at different times and in different context, and a good and quick search is the best way to get to the right source. Google is the grand daddy of search and has been doing its job pretty well - barring the times when SEOs play smarter and help push some crap link higher in the search list. A good information search utility is not just useful for individuals, but for organizations as well - as database and content management software can only do so much. 
Even with all these tools/mechanisms it is still hard at times to find the relevant information easily - that relatively unknown song from the 70s which for some reason has been playing in your head all morning; or that research paper recommended by your professor that can help you complete your dissertation; or some good data on a niche market that you are exploring. Not much has changed in the way we discover information for years, but the quality of these methods surely has improved a lot. 

Information Consumption 
In spite of people missing on to a lot of useful information, a good amount useful and interesting stuff still reaches us, which leads to another problem - consumption. With more information getting generated, people face two kinds of problem; it becomes more difficult for them to comprehend that information, and the average time spent on processing also goes down. This is a particularly big problem with enterprise users. However, as with any other problem, there is solution to this one as well. There are ways in which information can be processed or represented in order to enable better consumption by users - 
  • Presentation - One of the most common ways of engaging audience is to present information in a comprehensive manner. This is why charts and graphs have always been preferred over numbers and text. Infographics are another great way of presenting a lot of information in a more comprehensive manner; Nicholas Felton's annual reports on his own life are a great example of the power of infographics. In addition to that, you can always explain things using videos. The more senses you use in learning about something, the more easily you understand it and the better you engage with it. With graphics the audience is only using their eyes, while with videos they use eyes and ears. Zappos started using videos for product demos, and witnessed "a sales impact of 6% to 30%". This is also the reason why iPad (or any good tablet) is a great tool for information consumption - because you are not just seeing and hearing information but also touching it. 
  • Summarization - Summarization is about taking a lot of information in, and then preparing a "executive summary" of sorts which can be consumed in lesser time. This feature is especially useful in fields where users have to deal with huge amount of documentation, such as legal and investment banking. The problem however is that there are not many services for this available out there. Topicmarks has been praised for its results in the past. Techcrunch Disrupt winner, Qwiki is trying to take information consumption to the next level. It summarizes the information requested and then presents it in a video format, which can even be interacted with on a tablet. If Qwiki is able to achieve its goal, it might become the default way to consume information. 
  • Analytics - Analytics can help us consume massive data sets, and is especially useful for enterprise customers. Presentation and summarization alone cannot solve the consumption problem for large data sets such as twitter feeds, click streams and log files. In addition to processing the information, analytics can also spot trends which can help organizations prepare for future. Companies expert in analytics are already helping organizations in many ways such as, developing better products and decreasing waste, and even helping governments prevent criminal activity. Earlier analytics was more of a reflection-on-the-past kind of activity, in which companies would crunch data that is days, weeks or even months old. Thanks to technologies such as Hadoop, organizations are now even capable of realtime analytics, processing the information on the fly and making faster decisions. 
Technology has come a long way in processing information, however we are still behind the curve because information is getting generated on an even faster rate. Entrepreneurs, engineers and mathematicians are working hard in helping us make the most out of this sea of information. It is definitely not an easy problem to solve, but surely an important one. After all, as Gordon Gekko, from the famous movie WallStreet, said - Information is the most valuable commodity.

Tuesday, September 20, 2011

Thinking Social

9:58 PM Posted by Deepak Nayal , , No comments
Anyone following the technology scene for the past couple of years would have definitely noticed the increased frenzy around social networking. Many big and small companies are thinking of or trying to leverage this phenomenon. However, many enterprises are still jumping into this bandwagon without really understanding what social means for their business. They think that creating a Facebook page/application or a Twitter handle or a LinkedIn group makes their company social, or integrating with these networks makes their product social. Social networking is obviously bigger than that. Companies can use social networks primarily in two different ways: marketing and product development. 

Thinking Social In Marketing 
Companies use existing social networks (such as Facebook and Twitter) for marketing, to promote themselves and their products and engage their users. This engagement [hopefully] matures overtime, and can be broadly classified into four different levels (shown below). Though each of these levels are logical progressions of engagement (with each level encapsulating the features of the ones below it), these are not completely dependent on each other. For example, the user can reach from level 1 to level 3 without going to level 2. 

Levels of Engagement on Social Network 
  1. Discover - The initial and minimal level of engagement, in which the user gets introduced to a product or an organization. This is like getting to know about a new product for the first time, when it shows up in your social network stream because your friend tweeted or liked it. 
  2. Share - The next level of engagement, in which the user shares content (generated or shared by others) within his network. It is equivalent to you 'Like'ing or 'Re-Tweet'ing about a company or a product. 
  3. Contribute - At this level the user not only shares but also creates the content, in the form of reviews, feedback, comments or stories, which are published in his network. 
  4. Engage - The highest level of engagement in which the interactions between the user and the organization are like a dialogue. The company shares news, products and offers with the user, considers his suggestions and highlights and rewards his contribution, while the user shares feedback and promotes the brand. At this stage the users become ambassadors of the organization within their own social network. 
Most of the organizations trying to leverage social media marketing are only able to reach the second level of engagement (Share), few reach Contribute, and even fewer reach Engage. These are the organizations for whom social media marketing is about having a Facebook fan page. They fail to create a dialogue between themselves and their users. The reason for doing so might be lack of time or lack of knowledge or sheer lack of commitment. No worries, though, help is on the way. There are a lot of applications and services available on the internet that enable companies to launch and manage social media marketing campaigns. Wildfire is a pretty good example of such application. You can launch and manage campaigns on social networks, creating a dialogue and engaging users. The overwhelming level of information generated on the internet everyday and the decreasing attention span of users means that sheer presence on social media is not enough and companies need to find ways of getting mind share. 

Thinking Social In Product Development 
There are many enterprises that just create a Facebook application, or incorporate 'Like' button or the comments feature and believe that their application or website is now social. They fail to realize that social networking is a lot more than just Facebook, LinkedIn or Google+. It is a more fluid concept that extends beyond and goes deeper than these platforms. Organizations who want to leverage full potential of social networking in their products and services need to go back to the drawing board and understand how their product or service can enable people to connect, communicate, express and collaborate; giving users incentives to not just listen but also add to and start the conversation. 

Facebook or Google+ or Twitter are great social platforms - some of the most articulate online representation of social networks to date - but they are just means to the end. In fact, you do not even need them to leverage the power of social networking in your offerings. Successful brands have been leveraging social interactions even before social networking became a fad. eCommerce platforms such as Amazon and eBay built and leveraged what may be called loosely-held interest graph based social networks. Email lists and blogs are also examples of social networks. 

The current big daddies of social networks are so successful because they articulated social and interest graphs really well, becoming the most obvious examples of social networking. However, there are many products out there that have developed their own social platforms by enabling human interactions. These "vertical social networks", such as Tumblr, Quora, Instagram, Jive, Chatter and TurnTable.fm, cater to different needs and interests of people, and have done really well in the process. Though all these platforms are very different in their user interface, design, target audience and concept, all of them allow people to connect, communicate, express and collaborate. And this is what social networking is about. Companies looking forward to leveraging social networking in their offerings need to think in these terms.

Wednesday, September 14, 2011

Mobile Apps: The Supply Side

9:33 PM Posted by Deepak Nayal No comments
It is no surprise that mobile phones have been a fast growing market for years now, but the smartphones have really propelled this market to greater heights. The global mobile phones market grew approximately 20% year-on-year in the first quarter on 2011, and most of it was attributed to the smartphones. In Western Europe smartphones shipments have already outpaced the feature phones, and US is not far from being a smartphones-dominated market. An important point to remember here is that though smartphones are growing at a stupendous rate, feature phones are still a huge market.

The greatest benefit of mobile phones is - obviously - mobility, and smartphones have leveraged this mobility by introducing the world to mobiles apps. Though technically mobile apps refer to applications on both, smart and feature, phones, the word apps now is generally used to refer to the ones used in smartphones, such as iPhone, Android, Blackberry and Windows Phone. While voice and SMS are still two of the most used features of mobile phones, apps have become a huge hit amongst smartphones users. The growing popularity of the apps amongst consumers can be judged from the exponential growth in apps downloads and the positive outlook for future. This demand in apps is also reflected on the supply side, with new mobile apps getting added to app stores at an annual rate of 63%. Though feature phones apps have also witnessed growth, it is nothing compared to their smartphone counterparts.

Supply Side Offerings
While most of us know and hear more about the consumer [demand] side of the mobile apps market, a huge supply-side ecosystem has grown (and continues to grow) to cater to the rising demands. Following are some of the key supply side offerings that have evolved in the ecosystem. Each of these - briefly introduced below - is a big market on its own.
  • Application Development Service - Application development services market is driven primarily by organizations who either lack the required skills in mobile app development or would like to outsource the development in order to focus on their core activities. It can include services ranging from plain application development to end-to-end service (including development, distribution and maintenance). Currently two-thirds of the apps are developed by such third party companies, and this ratio is expected to grow even further. This is a huge market, which is expected to grow to $100 Bn by 2015.
  • Analytics - Mobile analytics tools help developers/businesses understand the trends around their products and their users better. It helps app publishers derive insights which can enable them to make better development or marketing decisions. Mobile analytics can be further divided into sub categories such as application analytics, data analytics and campaign analytics. With the increased usage of mobile phones and apps, mobile analytics market is poised for strong growth.
  • Payments - Mobile payments is about using your mobile phones for paying for goods and services, instead of using cash, cheque or plastic. This is a big and fast growing market with total value of mobile payment transactions expected to reach $670 Bn by 2015 from $240 Bn in 2011. Currently, these transactions are dominated by digital goods, though that is expected to change with the mainstream adoption of new methods such as NFC. Financial institutions, mobile network operators and mobile payment providers have been taking advantage of this growth by either working directly with consumers or by providing the platform which can be used app developers.
  • Developer Tools - Developer tools allow faster development of applications by providing pre-built widgets or webservices. These can vary from providing tools and frameworks to providing backend webservice (such as Parse) for building mobile applications. Two of the most common types of companies that provide tools and frameworks are the ones which either were already providing developer tools (albeit for different platforms) or the ones that are already into application development service.
  • Apps & Platforms - There are many other players in the mobile development space that provide apps and platforms that other companies and developers can use to develop, launch or market their applications. Players in location-based services (such as Gowalla) and augmented reality (such as Layar) markets are some of the best examples. These types of apps and platforms vary a lot in nature and can prove to be very important for app development. 

There is no doubt that the mobile revolution is here and is only getting bigger. Smartphones, in particular, have been and will continue to benefit from this revolution. This growth has led to creation and expansion of a huge supply-side ecosystem in the mobile space. It will not be surprising if the supply side market becomes bigger than the consumer side one (if that is not already the case). After all, spade makers made the most money in the Californian gold rush.

Friday, September 09, 2011

SMEs and Technology

1:13 AM Posted by Deepak Nayal , No comments
Small and Medium Enterprises (SMEs) are an integral part of the global economy. They contribute a large percentage - in many cases even more than large enterprises - towards the employment and GDP in various countries. With such impact on the global economy, any provider ignoring SMEs as a market will be missing out on a huge opportunity. 

Technology can be a great enabler for SMEs helping them to reach out to [potential] customers, manage customer relationships, vendor relationships, human resources, accounting, etc. However, as far as getting them to use technology is concerned, their size and resource constraints mean that they cannot be approached as larger enterprises are, and their commercial orientation means that they should not be treated as consumers either. 

Adoption Sweet Spots 
SMEs vary a lot in the nature of their business and operations, however, two points are applicable to almost all of them throughout the world, 1) they are always short of resources (time, money and skilled employees) and 2) they are always looking for more business (more customers or more revenue per customer). This is true for many large corporations as well, but a key differentiator here is that large companies undertake many technology initiatives that may or may not directly contribute towards top- or bottom-line, whereas for SMEs there has to be a clear correlation. A key point to note while selling to SMEs is that the value proposition has to be clear. SMEs will use your services only if the money and/or time they invest is offset significantly by the returns (or gives the perception of doing so). In order for SMEs to buy/use your service or product, the offering should fall into one of the following buckets - 
  • Help focus on core offering (save time) - SMEs are always short of time, especially if their founders/owners have growth aspirations. As much as these companies would like to focus on their core offerings, they have a lot of other chores to manage, such as IT, accounts and legal. Products and services that help SMEs save time and allow them to focus on their core offerings, with minimal investment are always in demand. This is a crowded space with a lot of big and small players, specially services companies. Productivity applications can present a good selling proposition in this space. 
  • Raise finances for funding their business (raise funds) - SMEs always need money, to fund their operations, to sell their products and to expand their business. They can raise this money from banks, VCs, individual investors or general public. This is where crowdsourcing platforms and social networking platforms that connect entrepreneurs with VCs and investors (such as AngelList) can help SMEs.  
  • Reduce costs - Technology offerings can help SMEs reduce their cost of running the business. This area has historically been covered by ERP solutions. Technology providers can help SMEs reduce their IT investment, hiring costs, cost of operations (by streamlining processes), procurement costs, marketing costs and customer service costs. Though there are a lot of providers currently out there with solutions that provide these benefits, a lot of them do not have strong enough ROI (or a perception of it) for people to invest. This is where SaaS providers, with their subscription based pricing model, can gain ground by charging customers based on usage, converting capital expenses to operational. It is a tough market to compete as it is difficult for small players to cover all depth and breadth of operations in the SMEs, which is why partnering and integrating with other providers can help software players provide larger set of services.  
  • Acquire more customers (increase revenue) - This maps to marketing solutions. Historically, internet-based marketing has involved search-engine optimization, display ads, search ads and trade forums. Recently, a lot of new players have jumped into this space with coupons and social media marketing based offerings. This is a crowded and competitive market; however, the new mega trend of SoLoMo has created new opportunities for software companies to bring SMEs closer to [potential] customers.  
  • Increase sales per customer (increase revenue) - This is an exciting area which looks into improving relations between SMEs and their customers, in order to increase average revenue per customer. This requires deeper understanding of the customers, and is an area where analytics and CRM tools can prove to be very beneficial.  
  • Just give it for free - There is a good chance that the value proposition you provide is not clearly visible initially, and that your product is the kind that people will find useful once they start using it. In such cases, it will be very hard to make the customers pay for the product upfront, and going "Freemium" is probably the best option here. Blogging sites such as Wordpress and Tumblr are good examples of such offerings.  

Size Does Not Matter 
It is not that big companies are ignoring SMEs. Enterprise software giants, such as SAP and Oracle, already have product suites targeted towards SMEs. However, they have not been able to repeat their success with larger enterprises in the SME market, because they bring along the baggage of large enterprise suites. Generally, SMEs do not like to invest heavily in technology and huge investments upfront are a big NO. New players are trying to swoop in SME markets with clear and targeted offerings, lightweight [hosted] solutions, usage-based pricing and responsive product development teams. Being small themselves, they can relate to the problems and constraints of SMEs. If big players have the resources and experience, small ones have the agility and focused approach. In fact, SME technology market is one of those areas where size [of the players] really does not matter.

Sunday, September 04, 2011

Enterprise Software Market Due For A Shakeup

Competition is good, for consumers obviously; for companies, not so much. In the world of technology, consumer [software] applications market is very competitive. The web has increased the competition by providing a level playing field to all the players, and cloud computing has made it even flatter. Barriers to entry are low, consumers are willing to try out new things, and the selling process is not too long (primarily because there are not many decision makers and stakeholders involved). In the consumer apps market, [usually] better player wins. Enterprise software market, however, is a totally different ballgame. In the enterprise market, there is a pretty good chance that the better player has not won, and is, in fact, still sitting in the wings waving desperately to be noticed. 

Problems 
When you talk about consumer applications, the first impressions that come to your mind are agile, lightweight, intuitive, etc. But when you talk about enterprise applications the first impressions that come to your mind are heavy, clunky, bloated, etc. This [agile] image for consumer apps has taken shape recently, thanks to the web 2.0 sites/companies - such as Facebook, Twitter and LinkedIn - and mobile platforms - particularly, iOS and Android. This change, however, has not happened (at least not fast enough) in the enterprise market. There are many reasons for this - 
  • Bureaucracy - Typical sales transaction in the enterprise software sector involves many stakeholders for both, operational and financial, reasons. Depending on the size of the transaction and the number of stakeholders involved, the duration of the sales process might vary from days to months and require approval from different business units, functions and levels. 
  • Financial Pressures - Managers are repeatedly required to hit their targets for revenue and margins for their respective divisions. This builds pressure on them, leaving less room for trying out new things and forcing them to go for tried and tested options. 
  • Existing Investment - Most of the times companies already have some kind of investment (money, people or data) in a particular technology, and in order to justify this investment they keep adding on to their portfolio even if it is not the best option to go with. 
  • People - Sometimes political motives and egos of people come in the way of going for improving things. This can prove to be the worst and most difficult problem to deal with. 
The problems listed above [and more] have helped existing players strengthen their hold in the enterprise software market. However, the recent changes in consumer application market have led people to question the status quo of applications they use in their offices. The cool, intuitive and easy to use applications they use in their personal lives have made them realize that there are better alternatives out there. However, in spite of the growing frustration, changes are still not happening fast enough, and the key reason is that the consumers and customers of enterprise software apps are different and usually have different priorities. 

Motivation To Compete 
In spite of the problems listed above, enterprise software market is still of a lot of interest to the players (existing and new) because of the incentives involved. While this market is tougher to break in, the rewards of doing so are huge - 
  • To begin with, enterprise software market is bigger than consumer one. 
  • Enterprise customers are willing to pay - unlike in the consumer market. In fact, if something is for free, enterprise customers might doubt its long term viability. 
  • You get large user bases at once. 
  • Enterprises do not change suppliers quickly, because of their existing investment. 

Breaking Into The Market 
Companies such as RedHat, Salesforce, 37 Signals and Box.net have shown that the enterprise market can be tapped by new players and that smaller companies can compete and grow in a market full of established players with large existing customer bases. Analyzing these [and similar] players can reveal the approaches that they have taken in establishing themselves in this market - 
  • They all started with a focused approach. They identified a single problem/area and focused on a way to provide a solution that is better than the existing players. For RedHat it was servers, for Salesforce CRM and for Box.net content management. Instead of solving larger and multiple problems they just picked one and ran with. Doing so helped them in providing solutions for one key pain point of the customer and spread their name in the market. 
  • They started with the SMEs. Larger customers are wary of small and new suppliers, while SMEs are an easier customer segment to target as they are much more flexible in trying out new things. Working with SMEs has another advantage, it helps you refine your product and prepare for the big boys. Once you have an existing customer base and some references in the market, it becomes easier to sell to the big companies. 
  • They kept their costs low and passed on the savings to the customers. Box.net and Salesforce did that by providing SaaS-based products, instead of providing bespoke solutions, while RedHat did that by supporting an existing opensource software, Linux. Cost is a default [and, in some cases, the key] pain point of the enterprise customers; by keeping their operational costs low these companies were able to price their offerings low as well. 
  • In some cases, the new [agile] enterprise market players also got their products in the hands of the enterprise users or smaller teams directly, albeit sometimes unintentionally. SaaS-based enterprise offerings, such as the ones provided by Salesforce and Box.net, help you price your products based on usage and keep the costs in the bracket for which lower level managers do not need approvals from senior managers. This bottom-up approach is very helpful because it can lead to a player having an established user base in a company even before trying to sell its products there, and gives a certain credibility and support during vendor evaluation. This also helps the enterprises align the interests of consumers and buyers. 
Enterprise software market has a lot of potential. Barriers to entry in it are high but then so are for the consumer market - Facebook, Twitter and Instagram are exceptions, not norms. Enterprise applications may not seem as sexy and glamourous as the consumer applications, but they surely have more potential to become viable businesses. With web 2.0 apps, consumers have tasted blood and this might be the best time for shaking up the enterprise software market and creating a win-win-win situation for startups, enterprise customers and end users.