How Chimp-sized Software Companies can Survive Against Gorillas

A look at technology battles of the past can provide insight into how smaller software vendors can compete against the megavendors of today.

By Steve W. Martin

In a meeting last year, Jonathan Schwartz, president and chief operating officer of Sun Microsystems asked George Colony, CEO of Forrester Research, what he thought of Sun. Colony replied, "Sun risks becoming the Data General of the decade. The company could easily slide toward becoming a ‘zombie’ - a lot of cash but no life, staggering and lurching with a fading heartbeat at each step." Like many other high-tech companies, Sun is battling for survival against IBM.

Whether it’s IBM, Microsoft, or Oracle, every market space has a dominant vendor also known as an "Eight-Hundred Pound Gorilla." So how can smaller "chimp-sized" companies survive against Gorillas? A look back into Silicon Valley history actually provides part of the answer.

Discover New Tech-Enabled Service Opportunities

Mark your calendars for the Silicon Valley Indian Professionals Association (SIPA) annual event on Saturday, Nov. 12 in Cupertino, Calif. The one-day gathering will focus on the dramatic market shifts and opportunities created in the area of technology-enabled services.

Get an executive perspective when Sand Hill Group’s M.R. Rangaswami moderates a panel of four leading CEOs - Joe Kraus of Jotspot, Zach Nelson of Netsuite, Umang Gupta of Keynote Systems and John Roberts of Sugar CRM — speaking on software-as-a-service. Other topics to be covered include vertical/domain specific search and knowledge process outsourcing. Visit www.SIPA.org to register for the event.

What "Ecosystem?"

Guy Smith of Silicon Strategies Marketing says "ecosystem" has quickly become one of the industry’s most overused words of marketing hype. But ecosystems play an important role in product marketing. Read Smith’s tips about how to truly cultivate a productive ecosystem and what benefits your company can earn in this week’s post to the SandHill.com Blog on sales and marketing best practices.

For more best practice insight, don’t miss K. B. Chandrasekhar’s advice on how on-demand firms need to build their own ecosystem in last week’s oped.

Share your insight on the software business. Email editor@sandhill.com with your submissions to the SandHill.com Blog.

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Parting Thought

"The block of granite which is an obstacle in the pathway of the weak becomes a stepping-stone in the pathway of the strong."
— Unknown

Courtesy of Malcolm Kusher, The Kushner Group