~8yrs ago (Dec’12) I got a job @Google. Those were still early days of cloud. I joined GCP @<150M ARR & left @~4B (excld GSuite). Learned from some of the smartest ppl in tech. But we also got a LOT wrong that took yrs to fix. Much of it now public, but here’s my ring-side view👇
By 2008, Google had everything going for it w.r.t. Cloud and we should’ve been the market leaders, but we were either too early to market or too late. What did we do wrong? (1) bad timing (2) worse productization & (3) worst GTM.
We were 1st to “containers” (lxc) & container management (Borg) - since '03/04. But Docker took LXC, added cluster management, & launched 1st. Mesosphere launched DCOS. A lot of chairs were thrown around re: google losing this early battle, though K8 won the war, eventually 👏
We were 1st to “serverless” (AppEngine). GAE was our beachhead -- it was the biggest revenue source early on but the world wasn’t ready for serverless primitives. We also didn’t build auxiliary products fast enough. Clients that outgrew GAE wanted “building block” IaaS offerings.
1st to hadoop (map-reduce ‘04) but our hosted Hadoop launched in ‘15. AWS EMR was ~200M ARR by then. 1st to cloud storage (GFS ’03), but didn’t offer a filestore till ‘18! Customers were asking for it since 2014. Didn’t launch archival storage or direct interconnect till v. late.
Common thread: engineering hubris. We had the best tech, but had poor documentation + no "solutions” mindset. A CxO at a large telco once told me “you folks just throw code over the fence”. Cloud was seen as the commercial arm of the most powerful team @ Google: TI (tech infra).
TI “built” stuff == good; Cloud “sold” stuff == bad. This unspoken hierarchy led to GTM decisions that cemented our #3 position in a market where we had far superior tech. Another reminder that BETTER TECH RARELY WINS AGAINST BETTER GTM:
As a result of this engg::product::sales tussle, we 2nd guessed if we were (1) platform or product (2) for developers or enterprises, serving (3) new age cloud-native cos or everyone. Steve Yegge has a legendary rant on #1: bit.ly/34RIYfV. KNOW WHO YOUR CUSTOMERS ARE!
A lot of early mistakes were made w/ #2-3: AWS was going to the customers and rolling cloud-compatible on-prem versions and direct interconnects to their DCs. We wanted more clients like Snapchat: cloud native. World had lots of goldman sachs: hybrid. GO WHERE THE CUSTOMERS ARE.
Sales teams without quotas (🤯); chaotic branding (GCP? Google Cloud? Google for Enterprise?); title inflation - everyone was “head of X” “lead of Y”; ill-conceived vertical solutions; weak partnership programs, etc. All this took years of fixing.
When TK joined from ORCL many old-timers left GCP to other parts of Google, but he was 100% the right person for the job: aggressive, customer-obsessed, sales oriented. My friends who stayed back speak of a very different org.
GCP is likely at $8-10B ARR now and still growing >50% y/y. This is remarkable, but MSFT came from behind and is now neck-to-neck w/ AWS. I am hardly shocked - for MSFT, an Azure contract was probably 1 extra pricing sheet under a pre-existing MSDN MSA. Zero legal friction.
My google exp reinforced a few learnings for me: (1) consumers buy products; enterprises buy platforms. (2) distribution advantages overtake product / tech advantages and (3) companies that reach PMF & then under-invest in S&M risk staying niche players or worse: get taken down.
As always, this is one person’s narrative so unlikely to be fully accurate. GCP is a much, much stronger platform and team today. Goes without saying, my heart will always root for Google Cloud. We are still scratching the surface of this beast and it is still day one. /end
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This is for SaaS & esp India-SaaS but applies more broadly as well. I’ve been investing in India-SaaS since '18 & harping abt this endlessly to anyone who’d listen. I’ll say it again: the age of “business model innovation” in SaaS is over. It’s done. What does this mean? 🧵1/20
If you don’t have a fundamental product or tech innovation at the heart of your company, you are looking at a 10yr slog ending in a $5-10M ARR plateau → a [10-20]% CAGR lifestyle biz; a sub-$50M M&A by the category leader; or a slow death to $0. What changed, you may ask? 2/20
10yrs ago, “GTM as product” still had a shot. Building a basic SaaS product was *hard*. Cloud was in relative infancy. At GCP, the 1st thing customers would ask us was ‘why should we entrust our mission critical software, infra, data to a 3rd party?” Today we laugh @ this Q. 3/20
gm! We are pumped to release v1.0 of Lightspeed's India & SEA Crypto market map spanning L1 & L2s, devtools, CeFi & DeFi, NFT & P2E gaming, DAOs, analytics & more across India+SEA. See shorturl.at/lwJQ4 for the full blog & what we are looking to invest actively behind: 🧵
Circa Nov'20 we were seeing 1-2 crypto cos/mo. Today we see 2-3 crypto cos/day! India & SEA are fast emerging global epicenters for crypto. Lightspeed has invested in 50+ crypto cos since 2013 - most of it in 2021 e.g. @FTX_Official@AaveAave@OffchainLabs@solana@PintuID & more
The opportunity set 2-3yrs ago in this region was primarily in CeFi -- e.g. @CoinDCX@CoinSwitchKuber@WazirXIndia@PintuID@indodax have scaled really well. Today we see a much broader opportunity set spanning infra, devtools, DeFi, NFTs, DAOs and Gaming - v. exciting times!
The 2010s were all about the Cloud wars. The 2020s might just be about Chain wars. Before chain maxies, there were cloud maxies. I know because I was one while @Google. We ended up in a precarious race to the pricing bottom before learning few hard lessons & innovating out of it:
In early days of a stack, innovation first concentrates & then moves up. The 1970-80s were about the processor wars. The 90-00 were about the OS wars. Early days of cloud were about basic storage, compute, networks, before moving to higher level services e.g DB-aaS.
But Fragmented lower layers can't support upstream innovation; good luck building higher-order services when the underlying infra keeps breaking apart. So, not only does innovation concentrate, lower layers also consolidate as innovation starts to move up.
It was great to talk to my friend @balajis a few weeks ago. He is a quintessential futurist, living maybe 10-20 yrs in the future & has been right about so many things that sounded ridiculous back in the day. Genomics, Crypto, DeFi, Covid. Highlights in thread. #EE21 (1/11)
We asked Balaji - why is he the way he is? He responded by explaining that there are 2 types of CEOs - a COO type (those who ensure the trains run on time) & a CTO type (those who think & live in the future). While both have their merits, he gravitates towards the latter.
As the CTO type, he spoke of his interest in identifying powerful secular trends & behaviours e.g. rapid adoption of internet applications that are revolutionizing humanity - from meeting to mating! Being aware of these ‘curves’ helps in hypothesizing where we are headed.
We @LightspeedIndia are thrilled to host Frank Slootman, CEO of @SnowflakeDB as the inaugural speaker for our #MastersOfSaaS fireside chat series w/ global SaaS leaders: RSVP@ shorturl.at/hDMZ8. As a fan, I've collected Frank's quotes ("Slootisms"? :-) for yrs; some favs👇:
Frank is an absolute master of speed. As the CEO of Data Domain (acqd:EMC), ServiceNow (NYSE:NOW), & Snowflake, Frank’s track record of execution + strategic vision is globally in the company of one. There are none like him. shorturl.at/avzL4. Img credit: @patrick_oshag
Frank on running fast and lean: Img credit: @Altimor