Some things just don’t make sense, but somehow, we tend to accept them at face value.
It’s amazing to me that we can get far more detailed, credible, and real-time reviews on where to go to dinner tonight than I can for a CRM or HR software platform, yet companies spend billions of dollars each year buying and selling software.
As the G2 Crowd team likes to joke, you can find more information on a $100 hotel than a hundred-thousand-dollar software package. The information you can find is usually biased and only focused on the most expensive enterprise software solutions.
On the other side of the table as a CMO, I would spend months preparing for analyst briefings. The goal was that the large analyst firms could work their ‘magic’ in positioning our company in the upcoming report. While analysts see the broad spectrum of an industry’s solutions, often they have never actually bought or sold software solutions in their career. It creates a disconnect.
This is insanity, for both the buyer and seller, something had to be done.
As both a buyer and seller of software, I have lived this pain. And, I have commiserated with many other C-Level execs who cannot get over how broken the model of buying software is… that is, until someone had the gumption to do something about it.
I’ll never forget the day back in 2012 when I took a meeting with a tech leader who visited Indy to pitch an idea for his next company. Meet Godard Abel. At that time, Godard was already accomplished as a tech leader, having sold BigMachines to Oracle for over $400M, and since that time, he’s had another sizeable exit, selling Steelbrick to Salesforce for $360M. But, let me tell you why I think G2 Crowd will be the biggest of them all.
Before Godard left my office, I was in. Not only as a customer, but I literally wrote one of the first checks as an angel investor to help them build the vision, and ExactTarget was the first customer. Simply put, the market needed G2 Crowd.
Why the Analyst Model is Broken
When Godard walked through my door, I had just completed a thoroughly exhausting, emotionally unsatisfying round of multiple Forrester Wave reports and Gartner Magic Quadrant reports. The realization that I walked away with was that there must be a better way.
While analysts like Gartner and Forrester are not going anywhere soon, the model that they’ve leveraged for years has been focused on a small slice of the overall software industry. That slice is the upper echelon of enterprise solutions, which completely leaves out mid-market, emerging categories and SMB software solutions. This means that analyst reports really only focus on a small part of the software industry.
While analysts have substantive domain expertise, their brand recognition does not make up for the gaps in supplying data to buyers of all industries and sizes, on the buyer’s terms. Analysts can’t keep up with the current model of software development. In a best case scenario, analysts will refresh a report about every two years. Two years in the world of software is like a decade with the amount of changes that take place in that time period. The model doesn’t reflect reality.
The analyst model is eroding because it doesn’t deliver real-time information, it doesn’t represent objective data from the end user, and it doesn’t service the entire spectrum of software buyers.
To bring this model to light, how often do you pay attention to what a single restaurant critic said about a specific restaurant before going out to dinner? How much weight do you place on the restaurant’s Zagat rating? That’s right… you don’t. You would rather rely on unbiased third party information from guests who have experienced the restaurant first-hand, and are objectively leaving feedback.
When the power is held by only a few players, it becomes biased as a relationship game. The review process becomes severely political in nature, leaving buyers looking for data that they can trust to make crucial buying decisions for their enterprises.
How G2 Crowd is Turning Software Buying on its Head
G2 Crowd has turned the software buying process on its head by creating the largest independent review platform in the world. The platform has placed an unrivaled focus on the quality of reviews for virtually every type of software you could imagine and across each industry. G2 Crowd touts over 170,000 verified reviews from real people and buyers, with over 230,000 business professionals using the platform to inform decisions.
The G2 Crowd platform empowers the end user to review the software products they know best and have personally used. It’s incredibly powerful to show real-time, side-by-side reviews based on real-world, unbiased user feedback.
In other words, G2 Crowd has democratized the software buying process, shifting the influence to the customer and buyer where it belongs. The feedback loop invites real-time product feedback from a multitude of customers. The democratized model reflects changes happening in the world of software immediately and doesn’t wait for a “two-year refresh” to reflect changes.
Industry leaders, like Salesforce CEO Marc Benioff, now regularly reference G2 data to underscore their company’s position in the marketplace. These days I can’t even go into a board meeting without a company referencing their G2 Crowd rating.
The industry has craved transparency and finally, G2 Crowd is delivering it.
G2 Crowd Anointed the Winning B2B Review Platform
Perhaps nothing validates the accomplishments of G2 Crowd to date more than their recent $30M funding from one of the best VC firms on earth, Accel Partners. I believe this most recent round of funding anoints G2 Crowd the winner of the software review business. It’s also why LinkedIn made a strategic investment in the business.
G2 Crowd has become the transparent voice that the industry needs. With that transparency and the review platform’s growth, has come significant influence. Their model isn’t driven by pay-to-play, as it invites everyone to the table to review products, and leverage the data. G2 Crowd understands that transparency is critical to eliminating any bias better than anyone.
Now, with a fresh $30M of capital, and the team to accomplish the vision of taking the company to the next level. The platform already has 25,000 products in more than 800 business solution categories. But, we know that software is eating the world… new solutions are being crafted daily, and G2 Crowd sits in a position to capitalize on what the future brings.
At our last board meeting, Godard shared with me that I was actually the first CMO to buy into what he was doing. Frankly, it was one of the easiest decisions I’ve ever made. In the world of venture capital, I have come to realize it is more about who you work with than any specific problem or opportunity. With G2 Crowd, we got both. It’s the reason why I have always been a believer, and also why our team at Hyde Park Venture Partners is thrilled to be involved in the company. We believe in the team.
Congrats to one of the finest leadership teams you will find on this incredible milestone. The G2 team has executed on the vision to bring transparency to the market with speed and precision. They have built a culture that reflects an employee-first mantra, where they would run through walls for each other. Congrats to Godard Abel, Tim Handorf, Mark Myers, Mike Wheeler, Adrienne Weismann, Matt Gorniak, and the amazing team at G2 Crowd for their collective efforts to reinvent the way that software is bought and sold. The world of software is forever changed for the better.
— Tim Kopp (@tbkopp) May 24, 2017