When I started my career in high tech back in the early 1990s, Geoffrey Moore and Crossing the Chasm reigned supreme. Whether or not companies used the term Crossing the Chasm or even knew that what they were doing was Crossing the Chasm, practically every company that walked through a venture capital firm’s door based their strategy on its tenets:
- Focus on a vertical market
- Target visionaries
- Use an enterprise selling model
- Market the ROI generated by the visionaries to sell to the mainstream
There was a good reason why Crossing the Chasm was so popular – it worked!
The first cracks in this view of the world surfaced in 1994 when Netscape was founded. Rather than hire enterprise sales reps to sell seven figure solutions to visionaries, the company gave away its browser for free. When trading closed on August 9, 1995, the day Netscape IPO’d, its market cap was $2.2 billion. While Netscape itself would meet an ignoble end, divvied up between AOL and Sun, technology strategy would never be the same.
Today, companies are pursuing an ever wider array of business strategies supported by countless packaging, pricing, sales, and marketing approaches. While every one of these strategies has its own set of champions who will claim that the whole world is going (pick one) open source, appliance, SaaS, etc., our view is that choice is here to stay.
This means that managers in emerging technology companies face an infinitely more complex set of strategic choices than their peers did a decade ago. Should they be an open source company (like RedHat) or a SaaS company (like Salesforce.com) or an appliance company (like Reactivity) or an open source appliance company (like Sourcefire) or a software and appliance company (Riverbed Solutions) or an open source SaaS and appliance company (like SugarCRM)?
Along with these choices come new sales, marketing, financing, and operational challenges. My goal for this blog is to help companies sort all of this out.