Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Atlassian is 20 years old and unprofitable

smartcompany.com.au

Post reply on HN
Print view View original

501–510 of 515 posts

Re: Atlassian is 20 years old and unprofitable

#501

Post by mbesto »

retcon wrote: post #498
Ferrotin wrote: post #479

Earlier quoted context omitted.

> Growing revenue while still not making a profit is not impressive. It is when you’re a software company and the marginal cost of the goods is zero.

>It is when you’re a software company and the marginal cost of the goods is zero. $600mm annual sales and marketing isn't cost of goods but the method of accounting that I subscribe to includes such costs as a fundamental cost of production delivery.

It's not, you can "turn off" S&M and people will continue to pay you.

Subscription revenue isn't the same as revenue in other businesses.

Re: Atlassian is 20 years old and unprofitable

#502

Post by mbesto »

adventured wrote: post #438
mbesto wrote: post #400

Earlier quoted context omitted.

> They're revenue now is just a $2bn And has been growing 30% YoY for the last 3~4 years alone. This is unheard of in any other industry/market. Their FCF is also impressive.

> growing 30% YoY for the last 3~4 years alone. This is unheard of in any other industry/market. It has been common for the leaders in every other market throughout commercial history, as it pertains to corporations of large size. What you're looking at are presently old industries and comparing them to newer, that's where your mistake rests. Walmart did it. Sears did it. Kmart did it. Best Buy did it. US Steel and i…

> Walmart did it.

Facebook took 17 years and Walmart took 25 years to reach $85B in sales.

Most tech companies have ~80% gross margins. Walmarts is ~25%.

You simply cannot compare the two.

Re: Atlassian is 20 years old and unprofitable

#503

Post by benhurmarcel »

new_here wrote: post #325
sien wrote: post #28

So with Slack there is Mattermost and Zulip. What are the equivalents for Jira ? Is there an openish source piece of similar software ? Jira cops a lot of hate on HN, but really to paraphrase Churchill on Democracy - "Jira is the worst issue tracking software, except for all the others". The comparison on Wikipedia has so many of them : https://en.wikipedia.org/wiki/Comparison_of_issue-tracking_s... Are any of them a…

Linear.app is awesome. We switched from Jira and our team's participation on issues went through the roof. It's fast, clean, has keyboard shortcuts and replaces agile terminology with simpler, familiar paradigms. We activated Slack, Sentry and GitLab integrations too. It's a beautiful piece of software to use and part of the reason we chose it was to inspire ourselves to try build something of similar quality in our…

There's no self-hosted plan, so for many companies it's a non-starter.

Re: Atlassian is 20 years old and unprofitable

#504

Post by steveBK123 »

technion wrote: post #477
steveBK123 wrote: post #255

Jira is an interesting product everyone loves to hate. It has the do-whatever-you-want configurability to fit anyones SDLC. Really its a software product that allows you to mirror your organizational structure. That said, 99% of software projects I have been on could be managed with a simple Kanban board like Trello (which they now own). Unless your firm has staff who are full time Jira jockeys in the form of project…

> full time Jira jockeys in the form of project managers I find that a funny description because I've worked with many many different full time project managers who always took the view that putting data in Jira or equivalents and pulling reports before the project meetings were entirely a technician's job.

This stuff blows my mind but tends to occur everywhere

What is the value add of an engineer doing project management work in an environment where project managers exist

Should the project managers need to do a little coding then?

Also the quiet part out loud - project managers tend to be vastly cheaper (often 2:1) than engineers. Any and every task that an engineering team can offload to a project manager is big dollars saved by the firm.

I frequently find myself in engineering roles where I am doing most stakeholder comms, requirements gathering, JIRA ticket entry/management, project planning, user documentation, support runbooks, PR reviewing, a bit of dev, occasionally testing, deployments, and sit on the support escalation pager rotation. Any of the above tasks you can offload to a non-engineer saves the firm money.

Re: Atlassian is 20 years old and unprofitable

#505

Post by foobiekr »

marcosdumay wrote: post #418
foobiekr wrote: post #393

Earlier quoted context omitted.

VCs love _technical_ risk. Outside of the very unusual circumstances of the Zero to One capital-funded-monopoly-theory era, they have considered _business_ risk quite toxic.

Hum... Quickly investing all your money into product development creates what kind of risk? I'm having a hard time separating them. Anyway, that can quite possibly be perfectly aligned with your company's goals. It's not a bad or good thing. It's just a thing.

My point is that you state "VCs love risk" and I'm trying to help you clarify the way you think about this. VCs don't love _risk_ at all, they love _things that are an technical execution risk but would sell immediately if they can be done_.

Business risk stuff - does the market exist? is a new pricing model possible? etc. - is not at all on the list of risks that VCs like.

Re: Atlassian is 20 years old and unprofitable

#506

Post by vladich »

dalbasal wrote: post #427
mbesto wrote: post #410

Earlier quoted context omitted.

I think we're in agreement here then, the valuations follow the fact that these companies can operationally grow much quicker than others.

Sure, they have. So, they certainly can. The question for Atlassian is how fast. 20-30% doesn't get you to a justification for Atlassian's peak value. It doesn't inspire "the next Microsoft" vibes. Maybe after 10-15 years of growth at this rate, it would... but the market's not paying these prices for that. Atlassian becomes an acquisition target if stock prices reflect a 20% rate of growth.

Since founders hold ~90% voting power combined, no, it's not gonna become an acquisition target.

Re: Atlassian is 20 years old and unprofitable

#507

Post by vladich »

Ferrotin wrote: post #479
time_to_smile wrote: post #468

Earlier quoted context omitted.

> And has been growing 30% YoY for the last 3~4 years alone. Growing revenue while still not making a profit is not impressive. If you give me $100 today I can go out a buy $100 a pair of new shoes, and sell it for $70. Give me $200 and I'll go out and by two pairs of shoes and sell them for both $84 (total)! Keep giving me money and you'll continue to see this growth I promise! > This is unheard of in any other indu…

> Growing revenue while still not making a profit is not impressive. It is when you’re a software company and the marginal cost of the goods is zero.

Atlassian makes zero profits because it reinvests them in growth (hiring, acquisitions). The common sense here is that you return profits to shareholders only if you can't grow fast enough. That's the case for a lot of other industries where you have single digit growth in good years. But if you can grow 30% annually, you bring much more value if you reinvest your profits.

Re: Atlassian is 20 years old and unprofitable

#508

Post by eastbound »

acdha wrote: post #344
Aeolun wrote: post #312

Earlier quoted context omitted.

Oddly enough, if your team is small enough that it doesn’t need a dedicated PM, you generally have no issues with Jira either. It’s almost as if the PM is the problem instead of the solution.

You have fewer problems with Jira. You’re still paying more for a slower application with a clumsy UI. I also wouldn’t be so quick to condemn the PM. I’ve seen plenty of developers insist on complex workflows and custom fields because they think they can automate everything, only later to realize they’ve created a second job. The problem is basically the lack of a functioning feedback mechanism to ask “do we need thi…

> You’re still paying more for a slower application with a clumsy UI.

The Atlassian terms of service make it illegal to discuss Jira’s speed.

Re: Atlassian is 20 years old and unprofitable

#509

Post by eastbound »

milesskorpen wrote: post #367
upupandup wrote: post #345

Earlier quoted context omitted.

> it's actually bad to be profitable when you're growing. I've seen this happen so many times: - profitable, down to earth founders generating net profits - VC approaches said outfit and tries to gather as much info - VC realizes said outfit is difficult to emulate and break into market - VC invests and starts demanding they run at a loss to grow quickly This works well when interest rates are low, and VC is not unde…

You don't say it explicitly, but there's a bit of a garden-of-eden in this story: Founders were running this great wonderful profitable business and then those darn VCs come in and ruin everything. A founder isn't forced to take on investors. The same founders who were so "down to earth" and profitable are the ones making the decision to take on investors. The founders can't be responsible for profits and then sudden…

I guess if you’re a founder-CEO, you may get tired after 20 years. Passing the ship over to market forces is probably the most widespread solution.

And maybe there is no good option, no matter how “down-to-earth” they are.

Re: Atlassian is 20 years old and unprofitable

#510

Post by majani »

lmm wrote: post #472
ASalazarMX wrote: post #382

Earlier quoted context omitted.

What's wrong with having a small or medium company? Why must a company sell its soul for the chance of becoming a money-printing behemoth in the future? I understand that being small leaves you vulnerable to the predatory tactics of big players, but I see that as a consequence of lax regulation. There are too many mono/duopolies already, and the bigger they get, the harder it will be to split them apart.

> What's wrong with having a small or medium company? Why must a company sell its soul for the chance of becoming a money-printing behemoth in the future? If you don't go the unsustainable blitzscaling route you'll be outcompeted by those who do, just as Atlassian did to plenty of smaller, more sustainable competitors. > I understand that being small leaves you vulnerable to the predatory tactics of big players, but…

Not necessarily. If your company has strong fundamentals, for example Microsoft, then blitzscaling is not needed because not even a free alternative can compete with you. And if you don't have strong fundamentals, you really shouldn't be taking investor money anyway. Blitzscaling is just an exciting term to align founder and investor incentives (which tend to be at odds with one another)
Post reply on HN