The New Stack Analysts

Increasingly, there is a growing community of less technical people who are interested in becoming more adept at building their own apps and finding ways to monitor them, too.

New Relic serves as a case study for a company that is adapting to this shift in business interests. From a new stack perspective, we are increasingly curious about how developer tool companies are changing as tools become more acceptable and the overall market continues to grow.

The shifts that happen when the enterprise comes calling served as a topic of discussion last week with Trinity Ventures' Dan Scholnick and New Relic's Bill Lapcevic. Scholnick has been a board member at New Relic since 2008 and is now a General Partner at Trinity. Lapcevic is New Relic’s Vice President of Customer Success and Business Development. They joined The New Stack Founder Alex Williams over a cup of San Francisco's Ritual Roasters coffee, which without a doubt helped them savor the conversation as it drifted into topics about the mechanics of running a developer tool business.

Learn more at: https://thenewstack.io/the-new-stack-analysts-show-16-how-new-relic-adapted-when-the-enterprise-came-calling/

“If you’ve been on the internet at all, you’ve probably seen one of our ads,” says Bill Lapcevic, New Relic’s VP of Customer Success.

“It’s not the brand marketing that has to change” when shifting from a SaaS marketing strategy geared toward small and medium-sized businesses to a SaaS sales strategy targeting enterprise companies. Bill knows that it’s necessary to bring the complete story, because, “from an enterprise perspective, they need other information other than, ‘This is what I do. This is why you care. Try the product.’ They also want to know, ‘Who else is using the product? Who else like me is using the product?’ So, you might find suddenly you have to do a lot more in-depth case studies. They often like to look at white papers. They like to look at things like Gartner Analyst reports to help them make decisions, so if you’re not working with those analysts in the right way and helping shape their vision, and listening to what they have to help you shape your vision, then you’re going to miss the boat there as well.”

Dan Scholnick, board member at New Relic since 2008 and General Partner at Trinity Ventures, is convinced that the quality of the product carries the day, no matter the size of the business consumer. Potential enterprise clients will try the product, “then they’d talk to our sales folks and say, “we need x,y and z enterprise feature.’ And we’d say, ‘Sorry, we can’t do that.’ And they’d walk away and say, ‘we can’t buy your stuff; we’re going elsewhere.’ And then two weeks later we’d look at our server log, and, ‘there’s that guy “Bob” from xyz company who said he couldn’t use us, and they just swiped a credit card and they’re paying us $5000 a month.”

Bill and Dan joined The New Stack founder Alex Williams over a cup of San Francisco-roasted Ritual coffee in the New Relic studios to record this episode of The New Stack Analysts podcast.

Dan recalls their days before cloud infrastructure, when potential clients would tell them how much they liked what New Relic offered, but they wanted it on-premises, ostensibly due to security and privacy concerns.

How does a company counter such a customer stance?

Primarily, says Bill, New Relic endeavored to seek out attainable security compliance and to develop stringent and audit-able policies regarding data privacy. These initiatives integrated into a solid security story that differentiates New Relic in the market. Moreover, “Lew [Cirne, New Relic Founder] had a vision,” Bill recollects, “that SaaS was going to overtake on-premise as the way to build and deploy modern web application software. And what we’re seeing now is that vision is actually accurate, that the market is coming to us…”

Often, developers are already holding the door open. “We targeted, and still target to a certain extent, developers as the primary user of our product,” notes Bill. Even within big enterprises, developers “have a lot more flexibility and they’ve got credit cards.” Developers may have already installed and already begun to use product before any official sales are proposed. When enterprises say “no,” Bill’s counter-stance might be, “you’re already using it and there aren't any problems.”

Both Dan and Bill allow that sales team growth is a fact of business, but that being product-driven leads to greater sales success and marketing efficiency. A superior product lays the foundation for the go-to-market logistics. Dan and Bill speak of “The $2000 Minute,” during which the customer experience of the product seals the deal. Dan believes that this crucial experience remains the key sales lever, regardless of the size of the prospect enterprise.

There is a certain myth when it comes to how we think of the way we define, build and manage new stack infrastructures. Too often, the conversation sinks into discussions that are too broad for any meaningful understanding. But when we start talking about mythology and its context to the data center, then we can really start exploring our roles and how we relate to the new stacks people are developing.

It's this discussion about mythology that surfaced in TNS Founder Alex Williams's conversation at the Open Data Center Alliance Forecast 2014 in San Francisco with Corey Voo, Infrastructure CTO, UBS; Chris Swan, CTO at CohesiveFT and Jonathan King, Vice President, Cloud Strategy and Business Development at CenturyLink Technology Solutions.

Learn more at: https://thenewstack.io/the-new-stack-analysts-show-15-myth-lore-and-religion-in-the-new-open-cloud/

There is next generation efforts among members of the ODCA. Docker and other next generation technologies are getting adopted but the focus is more on volume-based adoption.

People are using the cloud for the first time. It is almost scary that senior people are not touching what it is like to use cloud services.

The culture of the IT group is defined by “the way we things are done around here.” There is still a great deal of inertia. Banks, typically, are half business, half infrastructure. It would be disruptive if there was a much thinner slice of infrastructure. But that won’t happen.

Legacy: What is its role? There is a lot of conversation about migration. To be honest, there is not much of that anymore. People are now building in the cloud and connecting to back to IT.

There really is no real open cloud. The providers are similar to the carriers.

It’s odd to see this continued effort not to drive an open source approach.

In terms of policy, semantic environments are getting more notice.

As Adrian Cockcroft says, organizations are made out of their scar tissue.

Trust the robot, get beyond the fear of potential problems that might arise with new automation capabilities.

Too often it’s the lore, not the law that rules the day.

What is the mythology of the developer? The developer is the new kingmaker, as Red Hat likes to say.

Docker Hub exemplifies a new way of development that is more about assembling pieces than building from scratch.

There is this myth that every problem is unique and new. Containerization? It has been around since Solaris but Docker has solved the build, ship, deploy issue.

What is the mythology of legacy technology? In IT there have been these priests that have emerged. It’s more about serving a religion than solving a problem.

What is the impact of language on the enterprise?

Language in tech is sometimes reminiscent of Orwell and the concept of newspeak. It’s the buzz words that control the language and by default the conversation.

Usage models are really important and are becoming a real way to better understand across different constituencies in the cloud ecosystem.

On today's episode of TNS Analysts, TNS founder Alex Williams is joined by co-host, Donnie Berkholz, analyst at RedMonk; Tom Drummond of Heavybit; Matthew Wong of CB Insights; and by Gil Penchina, co-founder of Fastly. The recent news that Docker and Fastly received $40 million funding each spurs Alex’s curiosity about the evolving status of developer tools as investments.

With the acceleration of open source proliferation of developer tools and a history of tepid ROI outcomes for venture-funding in this market, questions remain as to the worthiness of investment in these services.

Learn more at: https://thenewstack.io/the-new-stack-analysts-show-14-are-dev-tools-crossing-over-the-investment-rainbow/

Alex Williams is joined by co-host, Donnie Berkholz, analyst at RedMonk, Tom Drummond of Heavybit, Matthew Wong of CB Insights, and by Gil Penchina, co-founder of Fastly.

The recent news that Docker and Fastly received $40M funding each spurs Alex’ curiosity about the evolving status of developer tools as investments. With the acceleration of open source proliferation of developer tools and a history of tepid ROI outcomes for venture-funding in this market, questions remain as to the worthiness of investment in these services.

Matthew’s research points to $800M invested in 65+ deals in this sector in 2013. The bigger players in this space are really building core developer communities and are drawing a lot of interest from venture capitalists such as Benchmark, Greylock and Sequoia. It's still very early in this space, and the substantial valuations of Docker, GitHub, New Relic and App Dynamics seem to promise a formidable market.

Donnie believes that the developer tools market has seen lots of investment fluctuation due to changing perceptions. Open source has gained domination and in the past has dissuaded investors, but the growth and maturation of the developer community has offset this perception, and the space has proved its legitimacy.

Heavybit is focused on developer tools and Tom says they are seeing huge amounts of opportunity. However, Tom cautions that looking at the exit market in the rear-view mirror is a poor indicator of the kind of market that is going to exist in the future. Tom observes that developers individually are now willing to invest in good tools and products, that the key drivers to good adoption and loyalty are simplicity and ease of use, and that more and more companies are building products for developers, leaving no doubt that the developer market will become more lucrative.

Donnie agrees on the importance of simplicity, and asserts that low barrier to entry is one of the common factors in making successful developer products. Developer experience is quite under-appreciated, says Donnie, citing the success of iOS as predicated on developers creating apps.

Gil says that the developer market has globalized, and that ease of entry is indeed important, but there are also development teams who are interested in more control over features, and these enhancements are gaining traction.

Tom bases his dissection of the market on a developer's workflow: writing, testing and running software. He categorizes the market three ways: tools for managing and collaboration; products that support continuous integration and delivery (and provide for load testing, performance testing, functional testing, Q-A testing, etc.); and tools for managing large deployments of machines and software. This final category has seen most of the recent investment, and it represents a wholesale reinvention of the enterprise software market. It used to be that only wealthy enterprises could afford these large-scale deployments but now this power is widely available.

Gil says that Fastly has seen more early traction within the DevOps community, but also with developers who are using Varnish, the open source platform on top of which Fastly runs.

We took The New Stack Analysts show to the Intel Developer Forum this past week. On the eve of the conference, TNS Founder Alex Williams gathered with Billy Cox of Intel and two respected cloud analysts: Ben Kepes of Diversity Limited and Paul Miller of Cloud of Data.

We wanted to know how the conversation about the data center has changed in the last year. Has the change been that significant? Cox has some perspectives about a data center that works entirely by itself, commanded by people from some distant place; Miller has perspectives about Google Kubernetes and Kepes keeps it real.

Learn more at: https://thenewstack.io/the-new-stack-analysts-show-13-defining-orchestration-and-drinking-the-docker-kool-aid-at-idf/

A discussion from the Intel Developer Forum where we cover:

Billy Cox said most definitely, with a new focus on the data center more so than speeds and feeds.

It’s the convergence that’s apparent and that is leading to new views about orchestration as illustrated in Google Kubernetes.

But the term “orchestration” is used and abused. There are various levels of orchestration that are important. Networking and orchestration, for example, have different forms of orchestration.

McAfee, for example, now has Intel NSX control that provides app protection, something that is not capable without network level orchestration.

The software defined story is a crucial part of the automation. It’s now important to call physical resources with software. It is why Google Kubernetes is so interesting as one aspect of the management layer.

But the term orchestration is used and abused.

It is important to talk about orchestration for software networking, storage, etc.

Orchestration to me is not just lights out, it’s people gone.

But containers are not the only answer. There are billions of virtual machines and that’s not going to change. Still, there is this emerging confusing mix of VMs and containers. Some form of orchestration is needed to do the work.

What you can do is standardize what you expose. This is increasingly important as IT gets more accustomed with programming the infrastructure with APIs. Servers can be configured based on performance goals.

Now comes the question: Does an Amazon customer want that level of access or is that optimization offers as a service? More so, it is a balance of what detail to expose.

In this episode of The New Stack Analysts podcast, captured at VMworld 2014 in San Francisco, Alex Williams and Virtustream's Chairman & CEO Rodney J. Rogers discuss innovation and competition in the Infrastructure as a Service utility marketplace.

Rogers suggests it's the top of the fourth inning of the customer-vendor relationship, and the push is on. Rogers' and Williams' analysis and insights on the current state and future of the industry cover many topics, including hybrid, containerization and the burden of operations.

Learn more at: https://thenewstack.io/the-new-stack-analysts-show-12-this-is-not-aws/

In this episode of The New Stack Analysts podcast, captured at VMworld 2014 in San Francisco, Alex Williams and Virtustream's Chairman & CEO Rodney J. Rogers discuss innovation and competition in the Infrastructure as a Service utility marketplace.

Rogers and CTO Kevin Reid founded Virtustream, a venture-backed company, in January, 2009. Admiring the elasticity and economics of the core, multi-tenant architecture that AWS has made its market, Virtustream's founders focused on Fortune 500 customers with a view to building a software product having a rich set of enterprise features, that services as a provisioning, management and orchestration layer to run a fully-functional cloud system.

Alongside enterprise stalwarts such as HP and IBM, the big players in the market - AWS, Google and Microsoft - are investing $1B per quarter in infrastructure. For a company such as Virtustream, then, architecture must provide the scalability raison d'etre. Surmounting the performance and security challenges of virtualization, Virtustream takes their abstracting approach into existing environments, generally to optimize for speed and efficiency, but ultimately to control IOPS, and therefore control throughput. This enables service level agreements that go beyond promises of infrastructure availability, allowing Virtustream to offer commercial SLAs based on application performance standards.

Rogers suggests it's the top of the fourth inning of the customer-vendor relationship, and the push is on. Rogers' and Williams' analysis and insights on the current state and future of the industry cover many topics, including hybrid, containerization and the burden of operations.