Tech Startups Reinvent Basic Business Models

Mobile, social, and local have been the hottest trends in tech. But TechCrunch Disrupt panel shows that the action today is in enterprise tech.

Patrick Houston, Contributor

September 17, 2012

4 Min Read

It's time to get on your inner Austin Powers. After decades of suspended animation, you pasty-faced denizens of the data center are about to claim a newfound status--as tech's equivalent of the international man of mystery. According to a bellwether conference last week, it's been declared: You're shagalicious, baby.

I saw it with own eyes: On the very same stage Facebook founder and silver screen subject Mark Zuckerburg commanded at TechCrunch Disrupt, four lesser-known startup execs held the throngs as rapt as Zuck did, serving on a panel with the title: "How Enterprise Got Sexy."

All yukking aside, the four made a strong case for why cloud services and other associated "stack" technologies promise to shape the landscape as broadly as mobile, social, and local have.

One of the reasons may be puerile. But it's not to be underestimated. It's a sense of idealism. It won't supplant greed as an incentive. Nevertheless a desire to "change the world" is an operative motive in entrepreneurial circles. It helped fuel the PC, Internet, social, and mobile revolutions, if only because people fervently believed those enabling technologies would eventually touch everyone everywhere. While enterprise technologies have long offered profit and personal wealth, they didn't beckon to the same vast socio-economic changes Bill Gates, Steve Jobs, Jeff Bezos, or Zuck personified.

Until now, that is. A new generation is being drawn to enterprise tech because it portends similarly sweeping impact. Reason: It's no longer about putting enabling technologies in the hands of IT pros. Instead, the new generation has its sights set on the corporate rank-and-file that in turn echoes through global markets.

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Because of the consumerization of IT, Aaron Levie, the 27-year-old co-founder of content-sharing service Box, believes he's empowering a far bigger universe of knowledge workers. With his service available via mobile devices, he's addressing a customer base outside the office building and out in the field that's applying not just muscle but their own gray matter, too.

Fellow panelists Justin Rosenstein, the co-founder of collaboration service Asana, and Todd McKinnon, the co-founder of identity management service Okta, shared a similar sentiment.

"If you think of companies as groups of humans," Rosenstein said in kicking off the discussion, “helping those people achieve their goals is incredibly sexy." Later, McKinnon added: "What's sexy is that we're enabling the enterprise to consume technology like a consumer," setting off a chain reaction. "I can impact a company, and that company can have an impact on the world."

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Of course this change has spawned new challenges. Mobile device management is one of them. But even that's serving as an adrenaline rush. Kirk Dunn, the COO of Cloudera, the Hadoop-based services provider, waxed about it. "It's not the device that's cool," he said. "It's what's going on behind closed doors in the data center to enable those devices that's cool."

One other fundamental change has people humming hunka-hunka burning love. The basic business model is being reinvented. As a result, incumbent players are at more risk than ever of becoming victim to the simple economics pervading the sector. New release cycles shrink from years to months and even days. Line-of-business managers--and their charges--are the ultimate arbiters of technology decisions. So traditional software makers are going to be increasingly saddled with the unsustainable costs of supporting a direct sales corps that can't possibly reach these de facto decision-makers.

It all hearkens to factors that are like pheromones so far as the commercial marketplace is concerned. Whether you're creating tech for the enterprise, helping to harness it, or putting it into the hands of end users, you may find yourself strutting your stuff and declaring to no one in particular: "Oh, behave. Yeah, baby!"

About the Author(s)

Patrick Houston


Patrick Houston is a former SVP for a new media startup, a GM at Yahoo, and editor-in-chief at He is co-founder of MediaArchitechs, which offers strategic product, content and business development consulting to technology-driven media companies. He can be reached at [email protected].

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