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Think Big. Move Fast.

SaaS is no longer a new business model. One look at any of the market maps for marketing tech, sales productivity apps, HR tech or other functional areas within enterprises would tell you how crowded these traditional enterprise software landscapes have become… Is there another billion dollar company to be built in some of these areas? Sure, and I’m actively looking for those. But where are the large greenfield spaces? What are the areas that haven’t seen a modern piece of software in years? I believe most of the greenfield opportunities in SaaS today are beyond the traditional horizontal/vertical enterprise software areas. As new distribution and pricing models emerge, and a younger workforce looks for modern software tools even in the most old school industries, some of the hitherto untapped areas are becoming ripe for SaaS to penetrate. Here are a few areas I am beginning to see some interesting startups emerge in:

  • Government software: I think the combination of the recent hires the Obama administration has made + the stark difference in the quality of software government officials use in their work vs. personal lives has gotten to a point where we are going to see huge SaaS opportunities open up across a spectrum of government functions – better software to manage elections, create/manage/store documents and forms, communicate with citizens, allocate city and state level resources, finance management, budgeting etc. Traditionally, selling to governments has been associated with long sales cycles and conservative buyers. But I think that’s beginning to change. Am increasingly coming across early stage startups seeing great traction selling to states and municipalities, in some cases while deploying an inside sales model, which would have been unthinkable even 3-4 years ago.
  • On-demand services for the enterprise: The on-demand economy has had a great run over the last few years. The model that Uber and Airbnb pioneered is now being deployed to all forms of consumer goods and services – food, groceries, car valet, laundry, spas etc. But surprisingly, to me, one area where on-demand startups haven’t focused enough is the enterprise segment. Workplaces have similar needs as households and individuals – food, office supplies, cleaning, maintenance/repair services, transportation, legal and accounting services etc. My view is that we will start seeing some interesting startups come up that offer similar on-demand services with an exclusive focus on enterprise needs. ManagedbyQ is a great example of a company that’s leveraging this opportunity.
  • SaaS for the hourly worker ecosystem: Historically, most of the big enterprise software companies have been built around addressing the needs of knowledge workers. Salesforce, Workday, Zendesk, ServiceNow, Veeva, Marketo, Tableau are all examples of software that address the needs of knowledge workers. This is largely driven by two factors: (1) Knowledge workers tend to spend a lot of time in front of a computer screen and the software workflows they use are mission critical to their daily output and (2) Knowledge workers tend to have more budget to spend on software. However, with everyone owning a smartphone now and freemium distribution models having proven out, almost everyone now stands to benefit from the power of software. Uber and Instacart are the most obvious examples of startups that have leveraged the penetration of smartphones and built massive franchises with 1099 workers on one end of their marketplaces.
  • Heavy industry software: Heavy industries like construction, mining, oil and gas etc. are still primarily using legacy on-premise solutions in various aspects of their business. From project management to cost/budget management to big data applied towards machine optimization, there is a ton of greenfield opportunity in these industries. With smartphones and tablets everywhere, field workers in these industries now have the opportunity to use software to make better decisions on the go… Why wouldn’t these industries leverage modern software to drive higher efficiency gains than they’ve ever had the opportunity to?

What other areas are ripe for SaaSification, according to you?

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Today we are excited to announce Lightspeed’s $10 million Series A investment in Rubrik. Just as Apple built a time machine to protect Macs, Rubrik has built a powerful time machine for enterprise cloud infrastructure that unites data management with web-scale technology.

A market size of epic proportions, a groundbreaking architectural approach, and a world-class founding team drove our decision to invest.

A $47 Billion Data Management Market

This year, IDC estimates that enterprises will spend $47 billion on infrastructure to manage data across business continuity (data protection, replication, recovery), regulatory compliance (archiving, eDiscovery), and business growth (application development/testing, analytics). The Rubrik time machine—Rubrik Converged Data Management—not only delivers backup and recovery but also lays the foundation to addressing each of these areas. For example, enterprises using Rubrik can accelerate DevOps by provisioning on-demand infrastructure for application development and testing.

A Radical New Approach

The velocity at which data is managed is crucial to business survival today. Rubrik innovates with a slimmer architectural approach to delivering instant recovery by eliminating the need for backup software. RubrikRubrik customers have gotten up and running within 15 minutes, slashing the amount of time (sometimes up to 6 months) required to establish and customize their backup and data protection environments and enable de-duplicated storage systems underneath.

In addition, Rubrik’s architectural approach recognizes the voracious need of today’s enterprises to manage ever-increasing volumes of data. Rubrik introduces web-scale technology to data management for the first time. Think Google and Amazon scale-out data centers. That means customers can scale up to thousands of nodes to handle PBs of data with no re-architectural changes or forklift upgrades.

A World-Class Team

When Lightspeed invests in companies, we look for people with the potential to be world-class entrepreneurs. Prior to Rubrik, Bipul Sinha was my colleague and partner at Lightspeed. He has an amazing knack for identifying and mentoring star entrepreneurs building radical new technologies to disrupt massive industries and has already been involved in some pretty game-changing companies like  Nutanix, PernixData, and Numerify. One year ago, Bipul decided to co-found Rubrik with Arvind Jain (Google Distinguished Engineer, founding engineer of Riverbed), Soham Mazumdar (Google Staff Engineer, co-founder of Teragoogle, Google Founder’s Award recipient), and Arvind Nithrakashyap (co-founder of Oracle Exadata, a $3Bn+ annual business). Together, they have built an all-star team from Google, Facebook, Data Domain, and VMware to revolutionize the data management industry by transforming complex, legacy enterprise IT into elegant products that are dead simple to use.

It’s a privilege to be working with Bipul, Arvind^2,  Soham and the rest of the team. Lightspeed is thrilled to partner with Rubrik on its journey to build a large, lasting, game-changing company.

Check out Rubrik’s Early Access program.
See Rubrik’s press release and keep up with the latest news @rubrikInc on Twitter.

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Highfive will change the way we work together

Arif Janmohamed, Partner, Lightspeed Venture Partner

highfive

“Please enter your 9 digit meeting code and hit pound.”
“Sorry, that passcode is incorrect.”
“Please enter your 9 digit meeting code and hit pound.”
“At the tone, please announce yourself and hit pound.”

For over a decade we’ve had to deal with an antiquated, frustrating model for running remote meetings and video conferences. How often do we waste the first ten minutes of a meeting trying to get the technology to work? And how often do we just give up and default to a simple phone call? Yet, we can easily set up Facetime, Skype or Google Hangout Calls with friends, family and co-workers. And with the click of a button, it just works.

The last generation of video conferencing technology was built before the iPhone or the cloud existed. Cisco / Tandberg, Polycom, Lifesize, together established the $3B video conferencing market with expensive, complicated on-premise hardware. The promise of ubiquitous face to face business calls has existed for years, but the barrier of a prohibitively high cost ($10K+ per room plus expensive set up and configuration fees) and a complicated jumble of technology and unfriendly User Interfaces have together soured people’s opinion of business-class video conferencing.

When we first met Shan Sinha and Jeremy Roy, founders of Highfive, the first thing they did was give us an early demo of the Highfive product. They proudly showed off a gorgeous, elegant device that incorporates HD Audio and Video and is easier to set up than your Nest Thermostat. The Highfive hardware device automatically pairs with the cloud and takes less than 5 minutes to plug into a flat panel TV and configure. Use your smartphone or your browser to set up a video conference. Invite a co-worker via an email or text message with a URL link. Share your presentation on the TV screen wirelessly, just like with Airplay or Chromecast. No cables, no dongles, no litany of connectors, no funky numbers, no annoying beeps every time someone enters a meeting, and no IT folks coming in to fiddle with cables or kick a rack of servers. It just works.

And then they told us the price: for less than $1000 (1/10th of legacy products’ price), you had a video conferencing solution that was simple, beautiful, easy-to-use and built for the mobile and cloud era. We were blown away.

But it wasn’t just the product that got our attention. Customers were just as excited about the product. In the past 3 months, the Highfive team has added over 500 new customers, including Zenefits, Patagonia, Slack and Warby Parker. The company is on track to process 1M video minutes per week within the first six months of shipping, which will make Highfive one of the fastest growing business video providers in the industry. And Highfive’s customers are changing the way they work. At less than $1K/device, it’s easy to install video in every conference room, leading to a completely different way of interacting face to face with coworkers, partners, and customers.

Check it out for yourself. One click video conferencing that we can all use… at a price that makes it a no brainer to put in every conference room in your office.
https://www.youtube.com/watch?v=IFqAOs09m8E

At Lightspeed, we’re extremely excited about our partnership with Shan, Jeremy and the Highfive team as they change the way we work together face to face. For more information about Highfive, visit http://www.highfive.com/.

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Prescient words from the CEO/Founder of Nutanix, Dheeraj Pandey . . . he wrote this almost 4 years ago and the future is turning to look a lot like what he predicted . . . .

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Why Nutanix, and

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Today we are excited to announce that Lightspeed Venture Partners is leading Guardant Health’s $50M Series C. For the last few years, we have been closely following advancements in genomics that have brought down the cost of sequencing the …

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Today we are excited to announce that Lightspeed is leading Clever’s $30M Series B. When we first met the founders Tyler Bosmeny, Dan Carroll, and Rafael Garcia, we were blown away by both their vision for transforming education and the …

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When Avi Networks founders Umesh Mahajan, Murali Basavaiah, and Ranga Rajagopalan first came to Lightspeed in 2012 with their vision of bringing the benefits of a hyperscale approach to application delivery and layer 4-7 services, it made perfect sense to …

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Once every few years, the combination of a couple of macro trends allows for a new software category to emerge. At Lightspeed, we believe such a confluence of macro factors is coming together to create the next big software category: …

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Today we are excited to announce that we are co-leading the first venture round in Blockchain, the leading Bitcoin wallet; a $30M Series A.

We have been studying and investing in the Bitcoin space for a couple of years …

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I recently wrote about this idea of the “Product Person” and how important it is for startups to have visionary artist DNA in its founding team. They are truly rare and it’s a big reason why so few startups succeed.…

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