RSS feedsAnnoyingly, I missed the dotcom boom. And I’m not alone. I think there are plenty of people reading this who, with the benefit of hindsight, would have taken more notice.
After all, the late nineties was an exciting time. For humble journalists it was a particularly exciting time. Club class trips to Silicon Valley were par for the course and we were often treated like royalty. Which is no wonder, considering the amount of money being spent.
On one occasion, Dell Computers really pulled out all the stops. It flew a gaggle of fresh-faced IT journalists to Birmingham in a private jet, champagne on tap. It put everyone up in a five-star hotel and the next morning flew those same journalists, complete with expensive cocktail-induced hangovers, to the Birmingham NEC by helicopter. And all of this for a computer trade show!
This was, of course, small change compared to some of the extravagance being shown at the time. Over the course of two years, the infamous internet startup company Boo.com spent £130m of other people’s money on limousines, glitzy PR events and Learjets.
But despite the rampant waste of money, the period could legitimately lay claim to some of the most exciting companies in business today. The likes of eBay, Yahoo, Google, Cisco and HP all made their mark in that few years either side of the millennium.
Of course, for every company that made it, there were perhaps 100 that did
not. The trick, as ever, was to determine what was the wheat and what was the
chaff.
Today, we are being given another chance. The technology revolution of the late
nineties is being repeated now, but with a difference. There are similarly
exciting things going on, except this time they have been forced to demonstrate
a more sustainable, grounded and, relatively speaking, sensible business plan.
A few things spring to mind. Software as a service is one. On a business
night out recently (which, compared to the dotcom boom, was positively
pauper-like, by the way) I got to hear all about the inner-workings of a company
called NetSuite.
NetSuite is an eight-year-old startup company which has Oracle founder Larry
Ellison as its largest investor. It provides complex CRM software to small and
medium-sized businesses via the internet, so removing the technological overhead
from the radar of the company buying the technology. Hallelujah, is the word
we’re looking for here.
It’s a neat story. NetSuite hosts the database, technology and storage required to maintain its clients’ customer records. The client accesses that content via the web, but has no direct involvement with the upkeep of the system. Its maintenance and security is controlled by NetSuite, which can be kept in check by a detailed and rigorous service level agreement.
The story goes that, every night, NetSuite employs a bullet-proof, rocket-proof, ex-military, armour-plated lorry to transport its customers’ mission-critical customer data to an obscure peak in the Rockies to bury it beneath 200 metres of earth for safe-keeping. Even allowing for artistic licence, it’s far more trouble than your average IT director would go to.
But the point is that NetSuite would not be able to provide the service it does unless the underlying technology that it relies on had matured. The feeling is that the internet has finally come of age to such an extent that we can trust it to run our mission-critical business needs. Today’s technology companies have a sound footing on which to base their offerings, and their clients are increasingly being run by those that reached their ‘informative years’ during the internet age rather than the stone age.
The exciting thing is that NetSuite isn’t alone. When Salesforce.com, another Ellison-backed venture, which offers a similar technology to NetSuite, IPO’d in June 2004 its shares gained a massive 56% on their first day of trading, taking them to more than $17. Today, they change hands for twice that. Research firm IDC predicts that the total ‘software as a service’ market will double to $10.7bn within five years. RightNow Technologies, another version of Salesforce.com and NetSuite, recently announced Q4 2005 results its 32nd consecutive quarter of revenue growth.
The internet now provides a platform for real business-critical tools such as online auctions, online procurement and online currency trading and exchange tools. Mobile sales teams can update transactional databases from the pub using a wireless PDA. Thankfully, your mobile workforce can also be tracked in real time using a combination of satellite and internet technology. While this may not sound particularly new, the great thing is that now the technology actually works.
So if, like me, you missed the dotcom boom, here’s a tip. NetSuite is expected to go public some time this year, in what promises to be one of the most eagerly awaited technology listings since Google wowed Wall Street in August 2004. This time, you might want to take more notice.
