Battery Ventures put out a great slide deck on the state of the software industry in 2017 as part of the recent CloudNY event.
Here are a few notes from the slide deck:
- 18.3% expected compounded annual growth for SaaS companies over the next four years (compared to 6.9% for general software)
- Software industry in the United States supports 10 million jobs
- The Five Forces of Software’s Accelerating Growth
- Existing software markets are growing over time
- Software is infiltrating what were once niche markets
- Software is displacing hardware
- Every company is becoming a software company
- 60% of organizations to increase spending on cloud applications
- The global software industry is $500 billion per year
- Continuing at a 5% compounded annual growth rate, software will be $1 trillion/year by 2030
- Category kings consistently captured more than 70% market share
- Tactical considerations:
- Software innovation is now global
- There are competitors in all segments of the market
- Product now drives software sales
- Network effects and ecosystems build moats and drive stickiness
- AI and machine learning are enabling applications
- Microservices architectures and rapid product delivery are now must haves
- Culture is paramount and employee feedback is public
- Find a wedge and change the market dynamic
- Grow fast or die slow
Check out the slide deck on the state of the software industry in 2017.
David Cummings on Startups 