#GlueCon 2014 Notes: What Makes a Great Developer Company? – Ethan Kurzweil, Bessemer Venture Partners

Keynote: What Makes a Great Developer Company? – Ethan Kurzweil, Bessemer Venture Partners

• Why the time is now for the developer-driven business
  • Developers traditionally have been at the bottom, but now at the top of companies (tech and non-tech)
  • Microsoft has 2X the cashflow of Google today due to a focus on developers (servers and tools division growing)
  • Estimated 18 million developers, half in the US
  • Developers are now making spending decisions (The New Kingmakers), not just IT decision makers
  • PayPal is now focusing on developers
  • “Developers are a market” – Jeff Lawson
  • Developer business models are strong. Why? A good customer acquisition cost (CAC) -to- lifetime value ratio (LVR)
• What makes a great developer-driven company?
  • The seven commandments of building the biggest business possible (or at least most of them)
  • 1. Deliver a metered service – lowers the barrier to adoption (pennies to try), bill goes up based on value provided (e.g. Twilio)
  • 2. Your revenue grows with their business – if their revenue goes up, they spend more with you (e.g. DropBox on AWS)
  • 3. Replaces something that companies already pay for (e.g. AWS, Heroku)
  • 4. Offers an amazing experience (the developer experience/”DX”)
  • 5. Developers love it and express their love across their communities – Twilio opens every board meeting with 5-6 tweets about staff
  • 6. Exhibits strong network effects – doesn’t have to be viral, but does have a feedback loop or economies of scale when the network grows (e.g. StackOverflow)
  • 7. Eliminates the need for non-core skillset that no one enjoys (e.g. Stripe removing the need to build out the whole payment processing workflow)
  • 8. (Bonus!) Democratizes development to those without development skills (e.g. Optimizely)