Jason M. Lemkin argues software companies stay lean on sales but invest heavily in engineering. Replit makes $300M with just 11 go-to-market employees out of 300 staff. Zendesk's service business is booming across IT, HR, and finance, showing the industry isn't uniformly contracting.
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To go to Rory's point, I think there's some folks that are above the fold and there's a few that like Anthropic that are so far above the fold, we need to figure out how to scroll above the top of the monitor. But I think more are below the fold, more are seeing hits. And I actually think product and engineering is an island of stability today. No one is, the idea that maybe you see teams with fewer engineers, but when I walk into leaders, you know, I was at Replit the other day, $300 million in revenue, 300 people. There's like 11 people in go-to-market. It's probably like the old days at Atlassian, right? But a lot of engineers, like they're not shrinking the size of their engineering team, but everything else looks pretty lean.
Look, we're product and engineering and software teams is a significant part of our business, right? 40%. It's a big part of our business. Um, service in general is a big part of our business. So your argument about Zendesk, service collection is a very large business. It's our largest at-scale business growing very fast, faster than the overall company. Um, And that is IT service management. HR service management is like our fastest functional area, right? Going inside there, financial service management, just general employee service management. We just shipped a customer service offering, uh, in October. So like we're wading into those waters. This is crazy, right? This doesn't make any sense. No, the business is growing really, really well, right? We have to provide that software layer that makes that cheaper. There's no doubt about that, right? Like that's, That's our job to do. I think the generalized view that customers are going away in these times, like, certainly for some businesses, yes, you can say that, like some software businesses. The industry-wide phenomenon, which I think is what Rory was asking, doesn't make any logical sense to me, right? And again, we're either an example of the whole industry or we are somehow unique.
