Enterprise & Deep Tech Weekly
Issue #122: For the week ended November 23, 2021
The future will be composable
David Peterson
Composability seems to be everywhere these days.
If software is eating the world, APIs are eating software. It’s not just data enrichment or shipping or payments or telephony anymore. Thorny, higher-level problems are all slowly being abstracted away by the API economy, too. Whether that be adding real-time collaboration to your products (check out Liveblocks out of France or Cord out of London), carbon removal (check out Patch.io), embedded finance (check out Spinwheel’s debt API), or user auth (check out Stytch and their latest fundraise).
Add to that the inexorable rise of reusable open source software components and smart contract platforms like Ethereum, and you start to see the world of software as a modular LEGO kit, waiting to be put together in new and interesting ways.
Sure, composability has its downsides. To highlight one example, as the number of open source components and APIs your software depends on increases, so too does the number of potential security vulnerabilities you need to manage…
But, in my opinion, this is a tradeoff that’s easy to make, because composability is such an incredible engine of invention. It enables teams to focus on building solutions to new problems, rather than coding up solutions to problems that have already been solved. Composability not just encourages, but enables, rapid innovation.
Of course, as a long-time fan of no/low code platforms, this led me to ask the obvious question: what if composability could be leveraged by non-software developers as well? What kind of innovation might that unleash?
A few weeks ago, I published an essay arguing that companies like Zapier, Airtable, Webflow and Notion are pioneering an entirely new category of software — what I called “customer-built” software.
What I’ve since realized is that what makes these products so powerful is that they are, to varying degrees, composable. They provide building blocks, and users are empowered to put them together in whatever way they’d like…often building solutions that are utterly unique and/or specific to their own needs. These products aren’t as perfectly composable and interoperable as an API or a smart contract or an open source component, but they’re close. And this composability is, I think, one of the secrets to their success.
This is why I’m more convinced than ever that the future will be composable. And I can’t wait to see the types of innovations that will come from more people having access to modular, composable software. So if you’re building a product designed with composability in mind, send me an email! I’d love to discuss.
FROM THE BLOG
The Long Road to Creating a Category:
Category creation strategy, with a little inspiration from Apple.
Three Methods of Venture Capital:
A guide to navigating a manic market as a venture capitalist (part 1).
Back to Basics — My VC Manifesto:
A guide to navigating a manic market as a venture capitalist (part 2).
How the “No Code” Design Paradigm is Revolutionizing Enterprise Software:
Companies like Figma, Airtable, Notion, and Zapier are doing much more than vanilla PLG.
EUROPE & ISRAEL FUNDING NEWS
Israel/Cybersecurity. XM Cyber has been acquired for $700M by the Schwarz Group for its automated advanced persistent threat simulation platform.
Denmark/Serverless Backend. Netlify raised $105M for its platform providing hosting and serverless backend services for static websites.
Germany/Remote Desktop. Anydesk raised $70M for its remote desktop software that allows users to access any device at any time and anywhere both secure and fast.
France/Life Sciences Marketplace. Zageno raised $60M for its multi-vendor, online marketplace of life science products connected scientists, research institutes and biotech manufacturers.
Israel/Automation. EasySend raised $55.5M for its no-code software helping digitize manual customer journey processes.
Poland/E-commerce. Packhelp raised $45.6M for its custom packaging marketplace.
Israel/D2C Logistics. Flytrex raised $40M for its drone-based delivery service targeting suburban consumers.
Latvia/Productivity SaaS. Whimsical raised $30M for its unified workspace for thinking and collaboration conveying ideas effectively via flowcharts, wireframes, mind maps, sticky notes, and documents.
WORTH READING
ENTERPRISE/TECH NEWS
The Jamstack is all grown up. Netlify, a company with Danish roots, raised $105M led by Bessemer Partners at a $2B valuation. Founded in late 2014, the company has become the most visible and successful proponent of the “Jamstack” — a software architecture paradigm consisting of (J)avascript, (A)PIs, and (M)arkup served by a static site generator (SSG). “The company boasts more than 2 million developers using the platform, although many are using the free tier. It took the company five years to reach 1 million users and just a year to double that, so things are moving quickly. Netlify currently has 200 employees, with plans to double that in the next year as it puts this new capital to work. Company co-founder Christian Bach said that Netlify has a diverse customer base and it’s important for the company’s employees to reflect that….Netlify also announced a $10 million Jamstack Innovation fund to help encourage and support innovation in the Jamstack ecosystem with checks in the $100,000 range. In addition, it is setting aside another $1 million to invest in adjacent open source tooling for the ecosystem.”
Live shopping which has become a big deal in Asia is gradually penetrating the West as well. Walmart announced it will be testing live shopping on Twitter’s live streaming platform.
Chip supply chain issues. We are all feeling the supply chain challenges, and the semi industry is no different. Applied Materials lowered its forecasts, “as chip shortages slowed the supply chain of the world’s biggest maker of tools for making chips.”
Ericsson buying Vonage. The Swedish telecom equipment giant announced plans to buy Vonage for $6.2B. Vonage, founded in 2013, is an American provider of cloud-based communications solutions for small and medium businesses.
The red pill on crypto. Frank Rotman, one of the smartest fintech investors out there, dove deep into crypto last week and tweeted about it in a very thoughtful tweetstorm. His conclusions so far are nuanced and balanced. Charlie O’Donnell’s recent thoughts on DAOs are also worth reading.
Quantum encryption. An Israeli-German team announced a breakthrough in quantum encryption. “Most computer security available today relies on mathematical manipulations that, while highly effective today, could be easily cracked by a quantum computer. New methods of encryption that rely on the laws of physics will need to be developed to combat this, the researchers explained…Professor Ronen Rapaport and Dr. Hamza Abudayyeh of the Racah Institute of Physics at the Hebrew University and Professor Monika Fleischer, Annika Mildner and others at the University of Tübingen in Germany have achieved a significant breakthrough which brings us closer to a simple, efficient method of quantum encryption….The research team developed a system that uses fluorescent crystals in the form of specks, known as quantum dots, small enough that special microscopes are needed to see them…The device can be used not just for quantum encryption, but also in other situations that rely on quantum bits to encode information, such as quantum computation.”
HOW TO STARTUP
SaaS Metrics Survey. KeyBanc put out an awesome 71-page survey of SaaS metrics from 350 SaaS companies.
Goodbye London, Hello New York. Dr. Lewis Z Liu on why he moved Eigen’s HQ from the London he loves to the Big Apple. He cites Brexit as one reason, but another is more intriguing: “I believe that Europe’s (particularly Britain’s) negative cultural attitude towards sales is a major inhibitor to building tech champions on the same scale as the US or China. In my thirteen years of working in the UK, I’ve learnt that in British culture sales and selling is viewed negatively. This leads to hesitancy and lack of aggression when it comes to sales, which inevitably impacts revenue generation. Early in Eigen’s history there were many London-based employees who prioritised technological purity over commercial success; it was almost fatal for us. However hard it is, the UK needs to transform its cultural attitude to sales.“
Post-remote. Wired reports that many corporate leaders are pushing back against the culture of remote work. We occasionally hear similar sentiments from startup leaders as well. Opinion here is divided, but all corporate leaders should take a nuanced view of the benefits and drawbacks of remote.
HOW TO VENTURE
Reading the tiger. A long and thoughtful look at Tiger by Mario Gabriele. The piece is worth reading, but here’s one golden nugget: “One of the most intriguing parts of Tiger’s strategy is that it is exceedingly hard for traditional venture funds to emulate. By increasing the speed of the game, Tiger effectively sacrifices precision. It accepts a higher error rate to deploy more capital, faster.”
Atomico’s new $1.2B fund consists of $400M for “seed” and $800M for “late stage.”
Dunbar’s number. How many real relationships can a single person maintain? How many real relationships can a team of N people maintain? “The evolutionary psychologist Robin Dunbar explains the limits on how many connections humans can keep up, and the trade-offs involved when you invest in a new relationship.”
PORTFOLIO NEWS
Budibase launched on Product Hunt.
Planable’s CMO, Miruna Dragomir, on the importance of quality over quantity in content creation.
JFrog’s Co-Founder and Chief Data Scientist (and Angular Venture Partner), Fred Simon, covers taking edge computing and continuous updates to space.
EVENTS
Dec 2 / David Peterson on Joining Angular and How the Future of Enterprise will be “Customer-Built”
David Peterson, Partner, Angular Ventures
Dec 8 / Fireside Chat with Leigh Moore, VP of Marketing at Snyk
Leigh Moore, VP of Marketing, Snyk
