Think about the developer tools and systems you use, then think "what would I expect to pay for these?" Chances are the answer is that you'd expect them to be free or you'd find something else. That's what makes it a bad market.
> I think jetbrains, github, atlassian et al would like a word with you.
Yeah, but those are outliers drowning in a sea of free development tools. The price that they can charge is effectively limited by how much it would cost some to replicate the subset of that tool that they actually use.
A business that is paying $X/year for $DEVSOFTWARE for their entire devteam pays that only while $X is less than the cost of paying for developing the subset of $DEVSOFTWARE that they use. That limits what Atlassian can charge.
Compare to selling a tool to accountants - it doesn't matter how much $ACCSOFTWARE costs, the accounting department will only shop around, they will never just write their own (outliers excepted, of course).
Do you know any company that seriously wrote their own development IDE or project management solution comparable to Jira for internal use? That sounds like absolute madness to me.
I agree though that you should never sell to developers, most of them really don't care how they spend their time as long as they are occupied and work on something they deem interesting, so they will happily spend months or years reinventing existing solutions if given the opportunity (I've seen this again and again). You need to sell to the people that run the company and pay the developers or to the engineering management, because they know how much their developers cost, and they understand ROI better than they do. That said often developers are quite creative when making up reasons why not to use an external solution or tool and instead write it themselves, so whether you succeed in selling to a company depends on who's ultimately in charge of technology.
> Do you know any company that seriously wrote their own development IDE or project management solution comparable to Jira for internal use? That sounds like absolute madness to me.
I worked for one and you're right, it was madness. They still did it though.
Those are the exceptions that prove the rule. It's not impossible to succeed in developer tools; it's just a lot harder than other markets. And you usually also need an accidental luck factor like being the perfect product at the perfect time.
I have a whole rant about procurement -- don't get me started. The basic idea is that procurement should exist to enable mission performers to do their jobs with less friction, while ensuring legal compliance and minimizing cost to the company. But in fact procurement organizations often seem to think they exist solely to impede mission performers. This is not really their fault; it's just how their incentives are structured.
Just some other anecdotal thing, but if you have someone from procurement worth their salt they will make sure to get the licenses at good terms without tying the company to lock-in, increasing prices YoY etc. Of course, if there is a free alternative, all the better, but if you need to buy something it is definitely worth being on their good side.
Those are outliers, and even then most people I know with a GitHub account are using it for free. Same with IntelliJ - most of us at Google were using the Community Edition.
Andy Gocke put it on twitter better than I've ever seen it anywhere else:
'Developer tools seemed like a good industry to be in, "sell shovels in the gold rush" and all, but it turns out developers prefer to dig for gold with their teeth.'
I mean, as a hobbyist, and for side projects, I would use my teeth.
But for the company I work for, I don't care. I would recommend my employer the fastest and easiest tool. And my employer usually don't want to spend engineering time on reinventing wheels.
If I were to launch a business in this market, the targeted customers can't be individual developers, more likely other businesses.
Like gihub, individual developers who only use their free account are part of github's marketing team.
I chuckled a bit, but you and I know that devs are not savages :)
I'd probably word it differently:
Developer tools seemed like a good industry to be in, "sell shovels in the gold rush" and all, but it turns out developers prefer to make their own shovels to dig for gold (because it is often cheaper than buying).
