Contact Us

Use the form on the right to contact us.

You can edit the text in this area, and change where the contact form on the right submits to, by entering edit mode using the modes on the bottom right. 

130 E 59th St., Floor 17
New York, NY

Blog

The Developer-Driven Economy

RRE

How the Developer has become the Organization's Most Influential Power Broker

[Last Tuesday RRE made public our investment in Bowery, a company that we believe is doing to developer environments what Dropbox did to file storage and sync. When I joined RRE I promised to blog about some themes, trends and companies I’m most excited about, so I figured given last week’s announcement, now would be as good a time as ever to get the first one out, so here goes…]

In 2003 Nicholas Carr published a piece in the Harvard Business Review which famously promulgated IT doesn’t matter. Carr predicted that as we leave a world defined by scarcity of IT resources and enter one where “the core functions of IT – data storage, data processing, and data transport – have become available and affordable to all,” technology will cease being a source of competitive advantage for businesses altogether. Many at the time believed Carr was forecasting the death of IT in the enterprise.

Sure enough, it took maybe 5-7 years to get to Carr’s dystopian reality as cloud, open source and mobile crushed barriers to innovation, distribution and adoption of IT. However, a funny thing has happened: instead of IT ceasing to matter it has become table stakes. With ubiquitous access to infrastructure, software and software development tools in particular, we’re seeing software eat the world.

As technology has shifted from enabler of business process, to enabler of product or service, to the very product or service itself, we’ve seen IT transform from a cost center that is adjunct to core business to a profit center that is its lifeblood.

It was during this transformation that the power dynamic within the workplace flipped from the c-suite to the basement; from the employees clad in Armani suits with tie clips to those wearing hoodies with sandals. Consequently, we’ve seen the developer become the most prized resource in the modern organization, and it is this trend that lends itself to an enormous investment opportunity.

Devs as the Go-to-Market

Developers are your innovators and early adopters; they are the gatekeepers for new technologies and often decide which new tech succeeds and which fails either directly or indirectly (look no further than iOS and Windows – win the developer, win the platform war). Appropriately they have become the most powerful distribution channel for IT in the enterprise.

Devs often become catalysts for social communities which help spread new products and technologies organically, and their API-driven tools create the potential for powerful two-sided platforms. There are network effects to be taken advantage of here.

Moreover, the trend towards DevOps (and now BizDevOps) – characterized by the convergence of software development cycles and IT operations (and all business activities) – has effectively blurred the line between developer and sysadmin (and pretty much every other employee). Those tools which shrink developer time-to-value (aka time-to-code written) and offer frictionless onboarding, often multiply through the organization. From Splunk and Logentries, to Puppet and Chef, to New Relic, to Mongo, to Datadog, we’re seeing the emergence of companies at every layer of the stack who succeed by winning the heart and mind of the developer.

Devs as the End-Market

There’s been a lot of talk about a renaissance in the dev tool market and it makes perfect sense: as dev teams become an organizational profit center the tools that make them more productive become that much more valuable.

The dev tool market is constantly evolving, but ultimately can be broken down into three categories which delineate the development lifecycle: writing code, testing code and running code. Within each of these segments we’re seeing companies who are fundamentally changing the way applications are built and shipped.

Tools from vendors like GitHub, Slack and upstarts like Bowery are helping devs write, manage and collaborate around code. Trends around continuous delivery and integration have compressed release cycles and made companies more agile and responsive to customers thanks to companies like CircleCI, Rainforest, and CodeClimate. Finally, the toolkit to ship and run code at scale is being reconstructed with the developer in mind. Infrastructure is becoming more open, more programmable and thus more developer-friendly. Products and platforms such as Docker and Digital Ocean are rethinking operations and infrastructure altogether with the developer at the center. Companies like Flynn are even further on the bleeding edge, trying to wholly productize the role of ops teams.  All of this implies that devs don’t have to mess with config files or worry about provisioning servers and databases and can just focus on their code, knowing their app will run and scale in any environment.

- - - - - - - - - - 

We’ve heard incessantly for the last several years about how the enterprise is being consumerized; how business apps are all about beautiful UX/UI, how BYOD and BYOA have broken down the corporate perimeter and how the procurer of IT is the end-user. What we haven’t heard much about is how the developer has become the biggest power broker in this new paradigm.