AWS, Azure, and Google Cloud all have a cloud marketplace – a place for independent service vendors (ISVs) and consultants to sell one-click deploy software solutions that run inside a customer's cloud account.
Historically, marketplaces have been bad channels for SaaS companies.
Why this is not so interesting today, and maybe a little interesting tomorrow.
Why it isn't interesting today.
- Software is easy to deploy with infrastructure-as-code, but this doesn't change the maintenance cost. When things go wrong (they always do), organizations lack the organizational knowledge to fix them.
- Enterprise software is high touch, marketplaces are inherently not. While system integrators are a thing of the past, having a point of contact with the vendor is essential to operating complex software.
- It's unclear if ISVs make enough money to make this worthwhile. The market says no.
Why might they be interesting in the future?
- Convergence of application runtime primitives. Kubernetes provides a common interface that most applications can deploy on. Replicated offers this as a service. Not all operational knowledge will transfer between different applications running on Kubernetes, but we're well on our way of abstracting out common elements – storage, networking, log management, and runtime.
- Better control plane / data plane architecture shifts some of the operational burden off of customers while still letting them deploy on their own account.
- Self-service eating away sales assisted deals. Bottom up software adoption is a strong tailwind for enterprise software. Individual contributors and teams using the software within companies provide product-qualified leads for enterprise deals. What if this trend continues? As organizations adopt more SaaS products, more of them will need to be self-service.
- These marketplaces all list the same products. Getting your product on each marketplace takes time and money. Tackle is a startup that offers a service to streamline this process for your company. Is there room for a multi-cloud marketplace? Hashicorp would be in the best position to do this.
- Is there an ad business here? Evaluating B2B software is more art than science. You can't do a proof-of-concept trial with every vendor. G2 is a site that provides reviews for enterprise software, but you could imagine that would be an interesting complement with cloud marketplaces (verified buyers, reviews, etc.).