Cloud

The cloud is changing how software startups make money

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Cloud computing has fundamentally altered the economics of software.

Thanks to the cloud, it is much, much cheaper for users who only need a browser to tap into the world’s largest data centers. It is cheaper for developers to write code and deploy it on virtual servers that are rented by the minute. And it is fundamentally cheaper for entrepreneurs to build and launch new services, to support business users and to scale rapidly.

Traditional SaaS companies have ridden the wave of lower costs, taking significant share from traditional software companies, but their single biggest cost continues to be sales and marketing. Innovative cloud service providers are figuring out how to take this advantage further, using lower costs to generate millions of users by giving away their service for free.

This approach is common in consumer world because advertising revenue can support the operating costs, but increasingly, business application companies are utilizing this approach by relying on a small percentage of users who pay for premium features or heavy usage.

In just over two weeks at Cloudbeat 2011, some of the leading business freemium thinkers and entrepreneurs will come together for a panel (Wednesday, November 30 at 1:30pm) to discuss how they were able to build fast growing, capital-efficient market leaders that are disrupting established competitors and making real money by giving away their crown jewels. Expect an interesting and in-depth discussion about how a business freemium company works, and how it is effecting the software landscape. Our panelists will include:

Ivan KoonIvan Koon is CEO of YouSendIt. A proven and passionate business executive with over 20 years of experience, Ivan has built YouSendIt into the Web’s largest business content collaboration solution. Under his leadership, YouSendIt has aggressively expanded its B2B collaboration platform and increased its registered user base from zero to over 23 million around the world.

David SacksDavid Sacks is Founder & CEO of the enterprise social network Yammer. He has been involved in the internet space for ten years as an entrepreneur, executive and investor. Prior to founding Yammer, David was PayPal’s Chief Operating Officer and product leader, taking the company from startup to IPO and eventual sale to eBay for $1.5 billion.

Jason LemkinJason Lemkin is Founder and CEO of EchoSign, acquired by Adobe. His operational experience spans the business development, sales, legal, human resource, and finance fields, and he is an acknowledged expert in the field of electronic signatures and electronic contracting.

Freemium in the business world is here to stay, and I am excited to talk with some of the pioneers of who can share their experiences and insights. Join us!

Brian Jacobs is a General Partner and Founder of Emergence Capital. He has over 20 years of venture capital experience, a deep national network and an understanding of how technology startups grow into market leaders.

CloudBeat 2011CloudBeat 2011 takes place Nov 30 – Dec 1 at the Hotel Sofitel in Redwood City, CA. Unlike any other cloud events, we’ll be focusing on 12 case studies where we’ll dissect the most disruptive instances of enterprise adoption of the cloud. Speakers include: Aaron Levie, Co-Founder & CEO of Box.net; Amit Singh VP of Enterprise at Google; Adrian Cockcroft, Director of Cloud Architecture at Netflix; Byron Sebastian, Senior VP of Platforms at Salesforce; Lew Tucker, VP & CTO of Cloud Computing at Cisco, and many more. Join 500 executives for two days packed with actionable lessons and networking opportunities as we define the key processes and architectures that companies must put in place in order to survive and prosper. Register here. Spaces are limited!