17 Wednesday, August 14, 2019 04:37

This VC helped jump start the app economy by launching the iFund. Now he thinks an overlooked part of the enterprise software market is about to explode.

Matt Murphy knows how to spot a trend. While a partner at VC firm Kleiner Perkins Caufield & Byers, he was early to recognize the game-changing potential of smartphone apps, and helped launch the iFund to invest in iPhone apps. He also helped lead Kleiners charge into enterprise software startups, playing a key role in its investments in DocuSign, the now-public electronic signatures company, and AppDynamics, the app performance company that was acquired by Cisco in 2017.

Now, he thinks hes spotted a new trend. Many of the hottest enterprise software companies today have succeeded by creating all-purpose applications that can be used by corporations in many different fields. Murphy, now a partner with Menlo Ventures, thinks the next wave is going to be all about specialization.

We see that as a really large trend, Murphy told Business Insider in a recent interview. Compared with the market for more generally applicable applications and services, he continued, theres more untapped opportunity in sector-specific ones. Read this:This VC and his firm dont focus on particular technologies or sectors.

Instead, they look for startups with a kind of network potential. Heres why. Software as a service— generally, applications and services that run in the cloud, rather than in corporate data centers, and which corporate customers pay for on a regular subscription basis — has been one of the big themes in tech over the last decade or so.

Salesforce was one of the pioneers. Microsoft has moved all of its traditional software such as Word and Outlook over to that model. And numerous startups, from Airtable to Zenefits, now offer their services to enterprise customers that way. But the trend has maybe been a bit too successful, Murphy suggested.

Many corporate sales departments are already using Salesforce and many human resources departments are using applications such as Workday. The market for such software-as-a-service, or SaaS applications, that can be used by many kinds of corporations and industries is becoming crowded, Murphy said. Startups are now targeting the construction and insurance markets By contrast, there are fewer startups that have focused on developing software-as-a-service products for specific industries, or verticals.

Over the last year, Menlo has been zeroing in on such startups. One such firm it invested in recently is Hover, which has developed an app and service specifically for residential contractors and construction firms. The app allows contractors to take a series of pictures of a house to create a virtual model of it.

. Contractors can use the model for remodeling or other home renovation projects. It allows them to show their customers what a job will look like when its complete and provide them with a cost estimate. Hovers service solves.....

News Code: 300224  |  Insider
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