Enterprise vs. SMB

In chatting about acquisitions and financing yesterday with a colleague, I was lamenting the "enterprise" vs. the SMB space.  My contention was that the enterprise is complicated, expensive to win, expensive to maintain, etc.  I was countered with the point that, "At least the enterprise has the money to buy". 

I know there's nuance here, but having dealt mostly with the enterprise and the inevitable travel (writing this at DFW airport), I can see why folks love the "hosted, on-demand, SaaS, self-service" model so well. 

It takes extreme discipline to avoid the temptations of the enterprise (the hunt, the big check, the professional services revenues, etc.) if your determined to grow differently.  To become "big" doesn't one have to engage the enterprise?  At least currently I think so.  Even SalesForce.com has required serious enterprise style integration and modification to do what's needed at the GE's of this world.  At least, that's my opinion.

Comments

[Will Herman]

Doug,

I'm totally with you on this. I too have had my successes int he enterprise space and have struggled getting my head around how you can make real money without opening it up.

Some of what I see today is that the companies that avoid selling into it are trying to get to a revenue level where they will be acquired as opposed to trying to making it go on its own. In this way, getting to $25-$50M in revenue attracts the suitors who, as it turns out, have sales forces int he enterprise space.

I wonder if we're coming to a time when only the largest companies will even bother selling into the enterprise.