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The Cost of Developers

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Re: The Cost of Developers

#161

Post by coldcode »

mikekchar wrote: post #42
coldcode wrote: post #38

Earlier quoted context omitted.

At where I work we use Github Enterprise, which costs way more than Gitlab Enterprise, is not scalable, and barely cares about enterprise customers like ourselves. Gitlab on the other hand is much cheaper, is highly scalable, runs in AWS, and is responsive to requests. Ultimately to make it as a business you need to provide what the customer wants and is willing to pay. Github never did.

Have I missed something here? Why are you with Github and not Gitlab?

We have both, however some teams predate Gitlab option and corporate inertia, politics and a lack of time keep those teams from switching. In a huge company changing anything can be a major pain in the ass.

Re: The Cost of Developers

#162

Post by Retric »

pythonaut_16 wrote: post #100
jasode wrote: post #65

Earlier quoted context omitted.

>, github sold out to investors, >Investors were in this for a huge exit I think these excerpts from your comment and also DHH's "VCs need their pound of flesh" are not helpful for readers on how to analyze the situation. They (maybe unintentionally) taint the discussion. Github is an entity owned by human beings. The founders included Chris Wanstrath, Tom Preston-Werner, PJ Hyett, and Scott Chacon. Therefore, emphas…

From the standpoint of an end user (which is all of the people complaining about Microsoft acquiring Github) VCs and their money are the bad guys, because the dynamics of their investment is what causes the acquisitions which change the service in ways that I (the end user) do not like. Not saying they're right or wrong (I think at the very least it's a limited point of view) but that's the argument being made.

Users love the VC's money. Uber handed out multiple billions of dollars subsidizing both riders and drivers from these massive investments, but even smaller investments often mean the same things. From photo sharing to local delivery most of these services are beloved in large part because they don't need to be directly profitable.

Re: The Cost of Developers

#163

Post by jillesvangurp »

jasode wrote: post #65
jillesvangurp wrote: post #28

Earlier quoted context omitted.

Correct, github sold out to investors, which then owned them, which then sold them out to get an exit when it turned out the company was in no shape for an IPO which is the only reasonable other exit if you are looking for a 10x ROI on a company that burned through hundreds of millions. Investors were in this for a huge exit and they just got it. In fairness, MS bought a valuable social network of essentially the ent…

>, github sold out to investors, >Investors were in this for a huge exit I think these excerpts from your comment and also DHH's "VCs need their pound of flesh" are not helpful for readers on how to analyze the situation. They (maybe unintentionally) taint the discussion. Github is an entity owned by human beings. The founders included Chris Wanstrath, Tom Preston-Werner, PJ Hyett, and Scott Chacon. Therefore, emphas…

You are extrapolating an opinion that I don't have. I don't consider the founders, investors, or MS evil. The only mildly controversial thing here is that a big corporation like Microsoft with a long history of hostility towards anything OSS ended up buying the goto gathering place for the OSS community. I don't think that ever was a dream scenario for any of the early founders or early adopters of that company. It will be interesting to see if e.g. Linus Torvalds migrates his linux repository elsewhere.

But obviously, Github was never a charity. It is owned by a group of investors that invested hundreds of millions. An exit in the form of an acquisition or IPO are the only two reasonable happy endings for such a company. This was like this from the day the founders decided to sell ownership to investors. That's what it means to play that game. Usually a first round leads to follow up rounds. Which leads to revenue and ultimately to an IPO. That's the scenario you pitch to investors. In the end it is about shareholder value.

So, normally an acquisition is considered the less ideal outcome of those two. It implies some sort of failure to deliver. Github running without a CEO for a while, reported cash flow issues, and then getting acquired by MS sort of supports that kind of story. I'm assuming the founders did indeed well for themselves. I'm wondering if the same applies to their employee stock option programs since typically those are a bit lower in the pecking order. I don't really know enough about the ownership structure to say anything here but I imagine for most employees ending up working for Microsoft might not have been the dream outcome. And as for most Github users, this probably was a bit of an surprise/shock.

In my case, I'm a paying customer and I see no reason to change that. Love the product so far and MS seem to have the right intentions and strategy to keep it that way.

Re: The Cost of Developers

#164

Post by hsribei »

ameister14 wrote: post #108
hsribei wrote: post #34

Earlier quoted context omitted.

Gitlab also took VC money and have an exit as their only option. Doubt they'll get as far as GitHub did though, and the option to just grow slowly into a solid independent business is off the table. Probably an acquihire with small return to investors.

Gitlab is really open about building to a 2020 IPO "We want to IPO in 2020, specifically on Wednesday November 18. 2020 is five years after the first people got stock options with 4 years of vesting. To IPO we need more than $100m in revenue. To achieve that we want to double Incremental Annual Contract Value (IACV) every year. We focus on an incremental number instead of growth of our Annual Recurring Revenue (ARR)…

Great find! Here's the source link: https://about.gitlab.com/strategy/#sequence-

Re: The Cost of Developers

#165

Post by mastax »

lev99 wrote: post #156
zaat wrote: post #19

Earlier quoted context omitted.

> Sorry, what? Windows still has > 90% market share on desktop. If that isn't "user-based leverage" I don't know what is. At first I thought the same way, but then I started wondering if those users are really meaningful users. Isn't most of the new developer products are either mobile apps or SaaS solutions, leaving aside monsters like adobe? If so, does it really matters that so many users are using windows if they…

> If so, does it really matters that so many users are using windows if they consume apps mainly with their (probably, chrome) browser? Windows is monetizing Telemetry data, which does have meaning and value, even for people that never leave chrome.

[citation needed]

Re: The Cost of Developers

#166

Post by mattnewport »

markm248 wrote: post #107

I don't understand the last sentence: "That, though, is exactly why Microsoft had to pay so much: buying in directly is a whole lot more expensive than using leverage, which can produce equivalent — or better! — returns for much less investment."

I think his point was that Apple has leverage over developers (you have to go through the app store to access iOS users) and therefore doesn't have to care about investing in a good developer experience. Microsoft doesn't have equivalent leverage to get developers to develop for Windows or Azure so they have to instead invest more in winning developers over by offering them better tools and services, hence the expensive GitHub acquisition.

Re: The Cost of Developers

#167

Post by jasode »

jillesvangurp wrote: post #163
jasode wrote: post #65

Earlier quoted context omitted.

>, github sold out to investors, >Investors were in this for a huge exit I think these excerpts from your comment and also DHH's "VCs need their pound of flesh" are not helpful for readers on how to analyze the situation. They (maybe unintentionally) taint the discussion. Github is an entity owned by human beings. The founders included Chris Wanstrath, Tom Preston-Werner, PJ Hyett, and Scott Chacon. Therefore, emphas…

You are extrapolating an opinion that I don't have. I don't consider the founders, investors, or MS evil. The only mildly controversial thing here is that a big corporation like Microsoft with a long history of hostility towards anything OSS ended up buying the goto gathering place for the OSS community. I don't think that ever was a dream scenario for any of the early founders or early adopters of that company. It w…

> I don't consider the founders, investors, or MS evil.

Fair point if I overstated your perspective on VCs.

I don't know if English is your primary language but if you didn't know, the phrase "sold out" is virtually always used in a derogatory manner. When one writes " sold out to ", the is the proverbial bad guy. It's also parsed as an insult to both and . E.g. "It's a shame that guitarist sold out to BadMusic Record Company."

It seemed like "sold out to investors" emotionally taints the VCs as bad actors and poisoned the discussion. (Yes, some VCs are bad and unethical.)

In any case, people should think of VCs as one type of financing option. (Bootstrap is another, but that has its own risks and downsides. Bank loans are another finance option but most startup founders have no collateral.) If you don't want to pressure your company into a big exit, do not talk to VCs.

>So, normally an acquisition is considered the less ideal outcome of those two. It implies some sort of failure to deliver.

Maybe. One of the VCs I saw mentioned that acquisitions are actually the more common exits for B2B companies. Github (enterprise) was more B2B than B2C. If this is the consensus view, both a16z and Sequoia may have anticipated acquisition as the most likely (and successful) outcome at the time they invested.

Re: The Cost of Developers

#168

Post by sulam »

jillesvangurp wrote: post #28
mgc092 wrote: post #5

Great analysis, although I don't completely agree with this statement: "GitHub, a company that, having raised $350 million in venture capital, was not going to make it as an independent entity." If it is referring to the fact that, in the crazy VC spiral of the startups world, once you have received such a big investment, a sale to a big corp is the only choice, then I sadly agree. But GitHub could have been an indep…

Correct, github sold out to investors, which then owned them, which then sold them out to get an exit when it turned out the company was in no shape for an IPO which is the only reasonable other exit if you are looking for a 10x ROI on a company that burned through hundreds of millions. Investors were in this for a huge exit and they just got it. In fairness, MS bought a valuable social network of essentially the ent…

> Gitlab is now pretty well positioned to succeed where Github struggled.

Gitlab is also VC funded. In fact it seems like you should be _happy_ that Github is no longer owned by the VCs.

Re: The Cost of Developers

#169

Post by citrablue »

scarface74 wrote: post #120
teddyh wrote: post #116

Earlier quoted context omitted.

VCs only invest in “startups”, i.e. companies which can be very big very fast, and can be sold for lots of money. This does not mean that every other form of company or product is irrelevant.

If you had a great idea for a non game piece of software, what market would you target? Windows, Web, or mobile? Where are all of the mythical profitable companies making commercial desktop software? Where are all the companies making new internal line of business desktop software?

Much manufacturing and warehouse software is on Windows, with extremely high end costs. ERPs, some are moving to the cloud but so much is still hosted locally. With HUGE annual license fees (often in the millions per year).

These systems are slow, unintuitive, and annoying. But they're stable. Companies don't want to risk their existence to change something that sort of works, so you'd be amazed at what a ERP solution with $X00,000 annual costs can get away with.

(In turn, they are often managed by / developed by the IBM/Oracle level of consulting b.s., which further drives up the costs.)

Re: The Cost of Developers

#170

Post by heavenlyblue »

simonh wrote: post #147
heavenlyblue wrote: post #128

Earlier quoted context omitted.

Yeah, but Chrome OS is also developed by Google - a revenue-seeking company. So you're either missing the point where the margins on the laptops are already including the cost of the OEM OS priced at an even lower price than a personal OEM license, or you're missing the point where the OS being free also includes your annual usage of Google services.

I’m not sure I’m following you. Bottom line is, if a consumer purchasing a laptop doesn’t care about Windows apps, two very similar laptops one running Windows and the other $20 cheaper running ChromeOS is not a good situation for Microsoft. No matter what Googoe’s revenue model is.

Well, I don't see any features of Windows that make it inherently not-free. So what's the catch here? I think people who are selling Windows believe they can milk that cow for some time, still.

During that time they can push on the software development tools/environment; and frankly they have always been better at that. Business logic is better done by business people and no matter how hard an average software developer is going to push against that - that's the truth.

Who do you think is going to acquire AirTable or alike? I could see Microsoft being incredibly interested in that opportunity.

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