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Also, you'll be more likely to notice things happening in a field you're involved with.
There’s lots of investment acquiring existing mature dev tools companies too. They definitely see something. It could just be a recurring revenue stream, but why that space? Lock-in?
> Every dev tool startups are getting funded. > beating reputed players like AWS, Auth0 etc? Maybe your view of "dev tool" is too broad. Identity shouldn't count as a dev tool. Perhaps security. It can be used to help manage end users. AWS isn't a "dev tool" either. There's no 1 answer as we're mixing in a lot of things. VCs will see things differently depending on what it is...
ok then let's narrow down to "Authentication/Authorization infrastructure" products like Auth0, AWS Cognito etc. There are atleast 5-6 startups who came up to this space in the last 3-4 years (after the acquisition of Auth0 by Okta for some $6B). And whenever such startups launch their product here in HN, most devs are like, what is the need for another product like this.
When the EO came out there were at least five publicly traded identity companies of any size: Okta, CyberArk, Sailpoint, Ping, Forgerock. Thoma Bravo subsequently bought Sailpoint, Ping, and Forgerock at meaningful premiums (~50%). VCs notice things like this.
[0] https://www.whitehouse.gov/briefing-room/presidential-action...
I think that is what is driving the current VC funding trend in dev tools. Also, considering the future of software engineering, dev tools will have even more adoption than before.
And regarding the pessimistic comments in HN, they are mostly coming from people who lack in-depth knowledge about how businesses work.
VCs throw shit at the wall and hope it sticks
Earlier quoted context omitted.
ok then let's narrow down to "Authentication/Authorization infrastructure" products like Auth0, AWS Cognito etc. There are atleast 5-6 startups who came up to this space in the last 3-4 years (after the acquisition of Auth0 by Okta for some $6B). And whenever such startups launch their product here in HN, most devs are like, what is the need for another product like this.
Biden's EO on cyber [0] mandates the agencies move to multifactor auth and zero trust architecture. Requirements on agencies flow through to their contractors, and eventually to the industries they regulate. When most consumer banks don't even do real 2FA (miss me with SMS pls), the TAM is yuuuge. When the EO came out there were at least five publicly traded identity companies of any size: Okta, CyberArk, Sailpoint,…
1. Software is everywhere. To build/run/manage software, you need Dev Tools. The demand can only go up as we continue to depend on software for everything.
2. Dev tools solve specific problems at least to start with. This makes it a bit easier to find PMF faster or die. Faster PMF = Faster Growth capability = Chances of Unicorn. VCs love that stuff.
3. Lot of current success already with Dev Tools as you mentioned. VCs have a herd mentality. They follow where the success is. Dev Tools has been hot for a while and will continue to be.
4. Dev Tools are usually started by techies who love building tools and cannot be started by MBA types usually. This means that the founders are usually solid with a background in those areas and they are likely to succeed more. Just my personal opinion.
I love dev tools. Few reasons I can think of: 1. Software is everywhere. To build/run/manage software, you need Dev Tools. The demand can only go up as we continue to depend on software for everything. 2. Dev tools solve specific problems at least to start with. This makes it a bit easier to find PMF faster or die. Faster PMF = Faster Growth capability = Chances of Unicorn. VCs love that stuff. 3. Lot of current succ…
VCs throw shit at the wall and hope it sticks
It's not just hope right? Many of them are doing serious business. But I just don't know how they provide clear value.
The value they provide is mainly the networks they've built up. Friendly with a bunch of other people with money and influence in various fields.