Freemium to the Enterprise

Freemium Meetup Founders Den 9/13/2012

Enterprise Incumbents (1990s)

vs.

SERVICES

A P P L I C AT I O N S

vs. vs. vs. vs. vs.

OS

D ATA B A S E

SERVERS

NETWORK

STORAGE

vs.

C O N F I D E N T I A L

D O

N O T

R E P R O D U C E

Incumbents Competing (2006)

SERVICES

A P P L I C AT I O N S

OS

D ATA B A S E

SERVERS

NETWORK

STORAGE

C O N F I D E N T I A L

D O

N O T

R E P R O D U C E

Cutting R&D, Accumulating Cash

Hewlett Packard Cash Reserves
$244 Billion $126 Billion

Revenue
3.9% $107 Billion

$91 Billion

2.3%

% R&D

C O N F I D E N T I A L

D O

N O T

R E P R O D U C E

Incumbents Competing (2012)

SAAS
CLOUD

SERVICES

A P P L I C AT I O N S

SECURITY
D ATA B A S E

OS

SOCIAL SYS MGMT

SERVERS

BIG DATA

MOBILE

NETWORK

VIRTUALIZATION

STORAGE

DEV TOOLS
C O N F I D E N T I A L D O N O T R E P R O D U C E 5

Enterprise 2.0 is
Software People Enjoy Using Built on Cheap Infrastructure Available Everywhere Freemium

C O N F I D E N T I A L

D O

N O T

R E P R O D U C E

Enterprise 2.0 is
Software People Enjoy Using

C O N F I D E N T I A L

D O

N O T

R E P R O D U C E

Enterprise 2.0 is
Built on Cheap Infrastructure

2001 $15- 20 MI L L I O N 24- 36 MO NT HS

2012 $1- 2 MI L L I O N 6- 12 MO NT HS

C O N F I D E N T I A L

D O

N O T

R E P R O D U C E

Enterprise 2.0 is
Available Everywhere

C O N F I D E N T I A L

D O

N O T

R E P R O D U C E

Enterprise 2.0 is
Freemium Business Model
DI SRUPT I NG
Revenue

Cost of Sales

Volume

C O N F I D E N T I A L

D O

N O T

R E P R O D U C E

10

Scott Irwin
sirwin@rembrandtvc.com

Enterprise 2.0: Calling Consumer Internet Entrepreneurs Enterprise 2.0 GTM Models

1.
2. 3.

Part 1: Freemium First, Enterprise Second

Part 2: Inside Sales Part 3: Selling Value

C O N F I D E N T I A L

D O

N O T

R E P R O D U C E

11