Adobe CEO, Shantanu Narayen (R) and Microsoft CEO, Satya Nadella at Adobe Summit 2019
Photo: Adobe

The platforms win again

Protocol Enterprise

Hello, and welcome to Protocol Enterprise! Today: why Adobe’s $20 billion deal for Figma is another sign that platform companies are reasserting their power over enterprise software, why enterprise tech is more of a carbon emitter than you might think, and this week in enterprise moves.

The rich are eating

After Adobe’s $20 billion deal for Figma, It’s getting harder and harder to see how the current generation of SaaS startups will ever be able to break the hold that entrenched platform companies have over the enterprise software market.

A decade ago, things were a little different: Businesses fed up with older, clunkier enterprise software were thrilled to piece together the tools they needed to thrive from a variety of different scrappy vendors. Founded in 2012, Figma rode that wave.

  • The company has been a designer’s darling since day one, a web-based tool built for the modern era that made its name because it was easy to use and increased collaboration within creative teams.
  • Figma added other tools and features to expand its usefulness, and was making inroads into some of the biggest companies in the world, such as longtime Adobe partner Microsoft.
  • It wasn’t hard to envision Figma turning into a design-forward enterprise software powerhouse in its own right; co-founder and CEO Dylan Field certainly thought that was the path his company was on as recently as last year.

But two increasingly important factors in enterprise software changed Figma’s course: Platform companies are desperate for growth, and enterprise software buyers are tired of managing dozens of vendors.

  • Adobe has been playing defense throughout the entire 15-year arc of the cloud and mobile computing era, but it has the inherent advantage of the established enterprise software company: a lucrative installed base among the world’s biggest software buyers.
  • While individual departments inside those large companies often have purchasing authority over the tools their teams need to use, there are still a lot of companies where enterprise software is purchased by upper management and imposed on employees.
  • While current Figma users were worried about the deal right off the bat, those companies will be excited: They’ll be able to keep their existing relationships with Adobe while offering their design teams the cool-kids tool.

After two years of pandemic-fueled growth that lifted the fortunes of basically everyone in enterprise software, it looks like the tide is going back out.

  • Public and private SaaS valuations have come back down to earth, turning companies that once hoped to make stock-based acquisitions into acquisition targets.
  • Enterprise software executives are realizing that they actually do need to become profitable at a certain point, which forces hard choices about where and how they want to compete with bigger, already profitable companies like Adobe.
  • And the looming threat of a slowdown in enterprise software spending could mean buyers forced to set spending priorities opt to stick with the vendors they’ve always used, who also have the margins to offer long-term discounts that startups can’t necessarily match.

Right around the time Figma was born, a new distribution channel — the cloud — and the rise of design thinking turned enterprise software into one of the most competitive markets in tech.

  • As we’ve noted many times over the last two years, the big platforms are striking back.
— Tom Krazit (email | twitter)

A MESSAGE FROM CNCF

ArgoCon, happening September 16 – 21 in San Francisco and virtual, will foster collaboration and discussion for audiences of all levels on the Argo Project, which consists of four projects: Argo CD, Argo Workflows, Argo Rollouts, and Argo Events. Register now for in-person or virtual to learn from practitioners about project pitfalls and best practices.

Register to attend: In-person | Virtual

Why enterprise tech is like the UK

Enterprise technology is often out of sight, out of mind. And even though the sector emits as much carbon as the United Kingdom, its carbon emissions tend to fly under the radar. A new McKinsey analysis out today found that the sector emits between 350 and 400 megatons of carbon dioxide equivalent gases per year (a measure that standardizes greenhouse gas emissions), or a whopping 1% of all global emissions.

And it’s not just the data centers that are to blame: The analysis found that personal business technology such as laptops, smartphones and even printers contribute up to two times more carbon emissions than its data centers do. This is both due to the sheer number of end user devices that enterprise companies rely upon and the fact that they are replaced more often than servers and rarely recycled.

But — good news! — options abound for CIOs looking to reduce their emissions, and many of them come at a minimal cost. These include simply buying less stuff, which can cut between 50% and 60% of end user device-related emissions, and recycling devices at the end of their lives.

The report also says that enterprise leaders should establish metrics for “green returns” on technology costs, focusing on the cost per ton of carbon saved as they consider suppliers and manufacturers of the technology that their operations rely on. The latter is in some ways the most important: Measuring emissions today makes cutting them tomorrow that much easier.

Read the full story here.

— Lisa Martine Jenkins (email | twitter)

Customer experience in the enterprise

The mandate is clear. Modern businesses need to provide a seamless, tech-enabled, end-to-end customer experience across their organizations: to always be ready, no matter the time or the platform, to promptly address customer needs and provide a human connection. This requires eliminating silos, increasing automation and analytics and ensuring that the front end and the back end are aligned to deliver a positive experience for your customers and your team. But how do you achieve this in today’s digital landscape?

In this virtual Protocol event on Sept. 19, we will dive into the tech tools and tricks and real-life strategies that companies are using to build a CX tech ecosystem and prepare for an increasingly customer-first future. Please join Protocol Enterprise’s Aisha Counts in conversation with Lara Caimi, chief customer officer at ServiceNow; Glenn Weinstein, chief customer officer at Twilio; and Clara Shih, chief executive officer of Service Cloud at Salesforce.

RSVP here.

Enterprise moves

Over the past week, Dataiku named a new C-suite member, New Relic added talent from AWS and Salesforce, and more.

Daniel Brennan is the new chief legal officer at Dataiku. Brennan was formerly vice president and deputy general counsel at Twitter.

Mary Writz joined Sift as senior vice president of product. Writz previously held product leadership roles at Hewlett Packard and IBM.

Siva Padisetty joined New Relic as SVP and GM of telemetry data platform and global infrastructure. Padisetty was formerly GM for cloud management at AWS.

Tia Williams joined New Relic as GVP of design and product experience. Williams was formerly VP of user experience and product design for Sales Cloud and Revenue Cloud at Salesforce.

Maarten Van Horenbeeck joined Adobe as chief security officer. Van Horenbeeck was previously chief trust officer at Zendesk.

— Aisha Counts (email | twitter)

Around the enterprise

The White House has ordered federal agencies to inventory all the software they use, which could help speed up the response to newly discovered software vulnerabilities.

Google Cloud introduced a free trial of Cloud Spanner as cloud providers continue to see databases as a primary lever of competition: Once the data goes in, it’s hard to get it out.

A MESSAGE FROM CNCF

ArgoCon, happening September 16 – 21 in San Francisco and virtual, will foster collaboration and discussion for audiences of all levels on the Argo Project, which consists of four projects: Argo CD, Argo Workflows, Argo Rollouts, and Argo Events. Register now for in-person or virtual to learn from practitioners about project pitfalls and best practices.

Register to attend: In-person | Virtual

Thanks for reading — see you tomorrow!

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