I had the pleasure to be invited to another SAP Startup Forum, an invite I always like to follow up as it provides some good proof points how SAP is progressing at creating and maintaining momentum of the ecosystem around its HANA database. And it’s also always a privilege to see startups pitching their products and offerings – the energy and drive are always a remarkable and welcome change in comparison to the more seduced presentations by the established enterprise vendors.
Great interest
SAP was able to get more than 30 startups to come to the Labs in Palo Alto, with about 10 taking part in the pitch competition to a virtually funded investor audience. It looked like there were more interesting and mature startups present than at the healthcare forum I took part back in June – but that may also be my background that cannot make too much out of the healthcare automation space.
A well run event
The agenda seems to be proven and works well with the audience, after a short welcome and an introduction to the SAP startup program, it’s time to present what SAP can do with HANA for startups, then SAP Ventures gets the stage – and that is usually where the startups pay the most attention (money talks – startups listen), followed by a showcase of HANA. Then it’s time for the first 5 startups to pitch themselves in the classic format – no slides, 3 minutes, Q&A afterwards, lunch and then the same for the next 5 startups taking part in the competition. The afternoon is filled with presentations on how the SAP Startup group can help startups to go to market and a panel discussion - this event's one was about BigData changing everything. SAP does well with a mixture of SAP execs (Kaustav Mitra), a neutral moderator (Simon Rogers from Twitter), a startup (CEO Michael Zeller of Zementis) and a thought leader (Jim Hornthal). And then its social time, more opportunity to visit the startups at the their demo stations and then fund them with virtual currency… by 5 PM a winner is found and the event is over.
The return of ecosystem $s
What return you get as a vendor for a $ invested into your ecosystem is probably even more tricky than the fabled marketing effectiveness $ question. Its especially hard when you have to build that ecosystem form scratch as SAP is doing with the Startup program. It helps if you are well funded and SAP is making multiple 100s of millions available for this effort.
And SAP has certainly achieved to be noted in the startup community. In the random questions I ask start-ups at briefings (of which I do close to a dozen a week) – I also ask them, if they have heard of SAP / HANA and what they think of it… and to my initial surprise the startup program is known and HANA has some prominence as a in memory database – so the initial goals seem to get hit.
But being known is one thing, being built on is another one. And that’s where SAP still has some ground to cover – as the startups are still in a more or less wait and see attitude in regards of using SAP technology. HANA as technology product is attractive, SAP as a partner is attractive (at least in the B2B area), but lacks the track record of a technology provider.
To be fair SAP competitors like IBM and Oracle struggle with the same – though not with the overall technology provider credibility – but with that of the technology provider for startups. Startups tend to go for the fast and cheap solution – and that is mostly the convenient open source download that can run tomorrow. So a tough battle to climb for any technology provider.
To be fair SAP competitors like IBM and Oracle struggle with the same – though not with the overall technology provider credibility – but with that of the technology provider for startups. Startups tend to go for the fast and cheap solution – and that is mostly the convenient open source download that can run tomorrow. So a tough battle to climb for any technology provider.
Free market research
The other key benefit – and SAP seems to be doing well to exploit it – is the connection of the more pedestrian speed of the SAP development process with the urgent automation needs startups and their funders are betting on. It’s a smart move to be close to startups to understand what the technology features of the future for e.g. HANA will need to be. It’s then another story if and how and when these will be built, but already knowing them and seeing them demanded and validated is of significant value for SAP.
On the flipside then SAP still needs to show that it can incorporate these requirements quickly into HANA. The feature I keep hearing is the geocoding that was made available with HANA SP6 – but that to a certain point is a no-brainer – if you want to foster analytics, decision and intelligence on something happening in the physical world – you need geocoding.
And then SAP seems not to have found the innovative usage of HANA beyond the well known and positioned alleys. I am still looking for startups that use HANA and could not have used anything else. That is the use case you want to know as a technology vendor – and we know SAP wants to be one - as they provide the much needed differentiators and markets you want to tackle and dominate. Interesting enough BigData was the most common use
MyPOV
SAP has mastered the first stage of creating an ecosystem around HANA. It now needs to find the use cases that help to crystallize the sweet spots for the HANA as a platform and with that for the ecosystem. That second step is harder than the first one – but SAP is on the way taking it. It is too early to make a call on both progress and success. Rest assured it will be made in time.