Chasing ambulances, winning trust and people in glass houses

So after a day of major email outage for Google mail users (i.e. that were Postini originally), things have finally settled down. Like many others working in the email security space, this provided mild bemusement – although not enough to start embellishing the potential ramifications (or pointing out how wonderful our SLA is). Unsurprisingly, other vendors have found it difficult to contain themselves – with one blog entry trumpeting the 100% uptime SLA.

Now vendors making “interesting” claims and SLA guarantees is nothing new – MessageLabs offered a 100% SLA against known and unknown viruses years ago. However, using this tactic to seduce customers – especially ones who are suffering at the hands of their current provider – is arguably immature and also prone to disaster. In fact, any sizeable organisation with half clued-up IT professionals/CIO will pull apart such claims – or at least insist on some stringent additions to the “teeth” said vendors claim they have in their SLA. For instance, how can you truly offer and guarantee 100% when you do not own the premises, the fibre, and simply lease space in the data centre? Crazy!!

Irrespective, back to the point of this – namely ambulance chasing or winning trust. Instead of jumping on the bandwagon and selling on the pain that has been caused by the outage, why not try a different approach? An approach that talks about the higher-level, strategic challenges that will (or have) manifest once a technology company has been acquired; whereby the acquirer sweats the asset, then strips the asset, and then slowly allows the old service/product to degrade – whilst offering inducement to come aboard the new one. This is of course not unusual, and you can look at the email market to see examples of large acquisitions over recent years to see this pattern repeated. For example; Symantec acquired MessageLabs for circa $700m, the founders (quite rightly) cashed in on their 10+ years of hard work, the talent slowly drifted away from the corporate beast that was night and day from the exciting startup they joined, and the service receives little or no significant investment.

This is no criticism of Symantec – nor anyone else. It’s a commercial reality. You don’t spend that kind of money on a business and then throw in the same again just for fun! Anecdotally, I often hear of a once great business or technology that has become a pile of rubbish after the big IT giant opened its war chest and offered the VC and founders the right price. Because of this, perhaps the trick is to have a rational and sensible conversation with a CIO, hopefully well ahead of the winding down of the original product or service – and certainly before a major outage. Have those “succession planning” conversations, but above all discuss the merits of the alternative you are proposing. Kind of basic sales stuff really.

So back to my ambulance chasing peers who are enjoying this current malaise – please remember that every VC has an exit, every founder a price, and above all, people who live in glass houses……

About Paul O'Sullivan

Speak plainly, work ethically, challenge stupidity

Posted on May 8, 2013, in General musings and tagged , . Bookmark the permalink. Leave a comment.

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