Susan Potter

Unfiltered musings on "enterprise versus startup" (the wrong question)

Sat August 8, 2020


Since the mid-1990s I have worked in software development at a number of organizations that ranged from the very big and changing slowly to the very small and growing fast.

I was asked recently to give advise on the kind of organization a former colleague should target with their next career move.

My answer was unenthusiastically received until I elaborated.

The following is an excerpt from our conversation with some details edited to protect the innocent. :)

"Enterprise versus startup" is the wrong question to ask.

Let's start with some definition of terms:


an earlier stage business which is not yet trading publicly which may have re

Tech startups, churn through many cutting edge technological changes that don't always work, sometimes at a rate faster than their engineering team can keep pace with. Accruing multiple versions of a service or capability that need to be maintained in production at the same time. This is expensive yet this realization is being deferred due to a combination of factors:

  1. Other investment vehicles aren't providing the alpha that the wealthy have grown accustom to in recent years. Venture capital funds are flooded with more cash than they know what to do with.

  2. Startups successful at playing the dog and pony show with investors are now valued much higher and much earlier than before the Dot Com Crash. The viability of the Internet is no longer in question. This means the startup can raise large rounds that will carry them much longer compared to 25 years ago. Ironically, the main reason for these larger funding rounds is the SEC regulation changes made after the Dot Com Bust to avoid companies going public too quickly. Today we are poised to get more WeWorks than WebVans which may prove to be much uglier.

Given that the enterprise technology world is entrenched in tradition and slow moving to take advantage of technological innovation and US startup culture promotes extreme risk-taking by typically younger founders who do not possess experience-based wisdom it is no wonder software developers burn out quickly at jobs. It is exhausting working with antiquated technology when you know more efficient methods and techniques are already available and mature. Likewise it is exhausting switching focus every quarter because the board need to see a certain kind of growth that is lacking at many startups or freshly IPO-ed companies.

There is a middle ground, however, and that could look like many things. It might mean taking a job at a smaller growth software business that is more bootstrapped and less beholden to investor's growth expectations. It might be a team setup in a large enterprise that is focused on building products for new business models while other parts of the organization milk their cashcow legacy products and services.

#** 1996-2005: Hall server closets to datacenters # #** 2006-2015: Until the "cloud"… # #The first iteration of cloud computing allowed businesses to focus #on their core competencies to deliver products their customers care #about faster for the cost of paying more in your operational costs sooner. # #However, even after developing more maturity than its humble early #beginnings with EC2 instances inside VPCs managed by ASGs that get #attached to load balancers or exposed through cloudfront #distributions so that your applications can scale up dynamically, #*scaling down to zero was always a challenge*. # #Mimicking datacenters via programmable compute and networking #primitives had huge potential for reproducible automation, capacity #planning and (sometimes) operational cost reduction that only some #software companies exploit today. However, it still required a #constant overhead such that scaling to zero was rarely feasible to #accommodate modern availability expectations today. This iteration of #the "cloud" I call the rentable programmable datacenter. # #** Until "serverless"

#Serverless is currently allowing those of us at the forefront to #launch new products and services to meet business objectives #experimentally without huge upfront investments in either capital #expenses or engineering time to fully exploit the rentable #programmable datacenter iteration of cloud computing we discussed before. # #Today the prized asset (rightly or not) is data. I am not going to #discuss the ways in which this asset is ##corrupting the very soul of democracy among other things since this #has been well documented.