How Development Teams Purchase SaaS
Foreword by Ethan Kurzweil, Partner, Bessemer Venture Partners
When Bessemer Venture Partners first met Eugenio Pace and Matias Woloski in 2014, they had a big vision to change IAM with a developer-first approach. The Auth0 team had an increasingly obvious insight—software drives business value, and developers were among the most important buyers to address. Having seen the early success of our investments in Twilio, SendGrid, and PagerDuty, we knew the power of bottoms-up go-to-market models selling to software engineers. We even penned a set of laws about them, but there were still doubts in the broader business community over the budget and power developers had outside of Silicon Valley startups. A lot has changed since 2014!
More so than ever before, digital is the primary way that businesses engage with their customers. Therefore, building software has become mission-critical for businesses and drives how people engage, purchase, and use products and services across different industries. The faster a company is able to release software, the better they can serve their customers, and the larger their share of the market.
Accelerated rates of cloud adoption have also changed the way enterprises purchase products. Infrastructure solutions are no longer chosen by an executive or a procurement department based on RFPs and fancy dinners; these decisions are now driven by the technical experts, who are living and working with these products. Rightfully so, they demand software that’s frictionless and effective to use daily.
Different from ten years ago, developers are finding themselves more and more often in the room where buying decisions are being made. Oftentimes, they are the initiators, experimenting with free or trial versions. In many cases, they try a product without oversight or process, using a credit card to begin a commercial relationship. We’ve seen many cases where this sort of entry-point graduates into a relationship in the millions or even tens of millions of dollars annually.
When you purchase a cloud solution from a company, you are effectively saying that you trust them to run a certain part of your business. In turn, this provides the customer and their developers the ability to focus on building product differentiation and new innovation. In other words, companies are more effective and competitive when they leverage the power of the API economy and other developer platforms to make more rapid progress on digitization and ultimately their end product.
In a world where consumer privacy and data security is increasingly top of mind, Auth0 has solidified its place as the most developer-friendly solution for identity and access management. That small team we first met six years ago has grown to hundreds of employees, working with thousands of enterprises and serving hundreds of millions of login transactions every day for not only Silicon Valley upstarts but also for massive Fortune 500s in healthcare, retail, and other traditionally “non-software” industries.
The Auth0 team has analyzed data trends and surfaced new insights from over 350 application development teams that can help inform leaders on the right approach to a digital strategy, whether it is an enterprise looking to purchase software, a startup selling to developers, or an investor looking to spot the next breakout trend in the developer ecosystem. These results clearly demonstrate how developers will be on the front-lines of the digital industrial revolution, driving software selection decisions across all organizations and industries as functions, from marketing and sales to security and operations. And these organizations will need software and APIs that are easy to use out of the box.
Ethan Kurzweil, Partner, Bessemer Venture Partners