One Million by One Million | October 26, 2013

Building a VC-Funded Tech Company from Upstate New York: Sinclair Schuller, CEO of Apprenda (Part 6)

Sramana: What strategies are you working on now?

Sinclair Schuller: One important lesson for any startup is to learn the direct sales model. Once you understand the buying model and the basics of your sales process, then you immediately start to look for leverage. Intuition will lead you to partners or channels that give you much more leverage in your model. That is where we are right now. We are looking to amplify our direct sales with strategic partnerships.

Sramana: What percentage of your business is product versus services?

Sinclair Schuller: Last year it was about 92% product licensing and 8% services. This year it will be 85% licensing and 15% services.

Sramana: A strong services component bodes well for channel partners. If they can wrap their services around your offering, they will be more inclined to help sell.

Sinclair Schuller: I definitely agree. There are also strategic partners we have where we amplify their ability to sell their product by selling our product.

Sramana: What does your ecosystem map look like?

Sinclair Schuller: Our vision for a private platform as a service is that it is the equivalent of the application server for the cloud. That requires developers to re-skill themselves to be able to write cloud applications.

When we look at the landscape of cloud computing players, we see three categories. We have SaaS players, who are business application vendors who deliver their apps in the cloud. There is infrastructure as a service, which is the ability to acquire virtual infrastructure in a low-friction way. This is what companies like Amazon do. The layer in between the SaaS players and the infrastructure players is where we live.

Sramana: The Force.com platform sits at that layer, although you probably differentiate from them by being a private cloud. Is that correct?

Sinclair Schuller: To a degree. If you look at Force.com, you will find that it is an extensibility platform around the CRM. We are a general purpose platform for arbitrary .NET and Java apps. It’s like comparing JBoss to the Office Extensibility Framework. Force.com is built with a custom language to expand that ecosystem, whereas we are focused on helping you build apps from the ground up with .NET and Java.

Sramana: What is your pricing model?

Sinclair Schuller: Our technology is a peer-to-peer fabric. We will take a bunch of operating systems and stitch them together into one unified piece. We care about the memory footprint of the collective group of servers. We have a per-gigabyte, per-year licensing fee that includes maintenance and support.

Sramana: The trend of platform ecosystems is very hot right now. Even small startups have significant platform ecosystems they are running. They can have thousands of developers on their platforms.

Sinclair Schuller: We are changing the IT landscape in a profound way. We are the engine behind lines of code being written instead of infrastructure. That creates deep value with our customers. We are the platform they target when they are writing code. Our accounts make big bets on us, and we like that. We want their production workflow. Companies like JP Morgan have 3,000 applications running on our platform. We are the foundation for their app environments.