Where will new ISVs come from?

Someone asked me the other day whether OpenEdge is attracting new ISVs and if so where are they coming from.  The answer to the first part is yes – we do attract a number of new ISVs every year who develop brand new applications using OpenEdge.  As we’ve been at this for a long time, the numbers of new ISVs are nowhere near where they were back 10 to 15 years ago but there has been a steady flow each and every year for the last 5 years. 

The second part of the question is more interesting; where are they coming from?  The trend has clearly changed over the last 3 to 4 years.  A recent industry study I saw showed a 3% decline in the number of software companies due to consolidation.  Clearly fewer new ISVs are being created today than in the past and not enough to offset consolidation.

 The vast majority of new ISVs over the past 3 or more years have been pure Software as a Service (SaaS) applications. Many are offshoots of existing ISVs or customers that decide they can attack a new market and create a brand new SaaS application to attract a new base of customers. 

There are several advantages to starting a new SaaS enterprise, not to mention the most obvious; it is the only way to attract outside capital.  Many traditional, on-premise ISVs that add a SaaS version of their application, quickly realize it is a very different business from traditional applications.  Being a separate entity with separate sales, marketing, development and support has its advantages.  It allows you to more rapidly respond to the needs of your SaaS customers where “service” and “speed” are the key differentiators. 

So will SaaS and Cloud infrastructure accelerate the market for new ISVs?  I’m not talking writing an app to monitor golf handicaps but honest to goodness business applications. I’d be interested in your views.

Bob Palumbo

Bob Palumbo

Vice President, Product Management at Progress
Bob Palumbo
Bob Palumbo

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