In a previous blog I wrote about the challenges vendors of enterprise or locally-installed solutions face as they attempt to compete with, so called, FinTech companies.  I boiled the argument down to 3 key components: cost, code and culture.  In the battle of new versus old, FinTech companies were the clear winners. They delivered solutions with a vastly lower cost of ownership, deployed and developed far more quickly.  And, culturally speaking, the companies themselves are young and entrepreneurial versus their older, more rigid and less inventive brethren.  In football terms, FinTech beat Enterprise by three goals to nil.  It was a stroll!

It is with some humility that I now must concede that I was not entirely correct.  Whilst my comparison was accurate, I had not allowed for the ingenuity of the enterprise vendors.  Sadly – for their clients at least – this ingenuity has mainly manifested itself in the Sales and Marketing teams that have fought hard to breathe life back into their, now dated, business models.

The result of this Sales sleight of hand is the launch of a raft of new ‘cloud’ solutions by virtually all the established enterprise vendors.  You can’t log into LinkedIn without an enterprise vendor pleading that ‘you come talk to them about their exciting new cloud solutions’, or the requisite fanfare around the launch of a new cloud product.

So, what’s the deal here?  How is it that the old guard have suddenly got religion and caught up with the young ‘pretenders’?  Of course, the answer is they haven’t.  They are relying on their clients’ potential lack of knowledge about the true nature (indeed genesis) of the benefits that cloud/FinTech vendors are able to deliver.

To explain a little further, what is sometimes poorly understood is that being deployed on the cloud is only the foundation of the advantage that FinTech companies deliver to their clients.  Being cloud based is simply a sign of greater potential.  Any vendor’s ability to deliver on this potential is directly linked to whether a solution was specifically designed to be deployed in the cloud…or, as we now say, was born in the cloud.

You see, being born in the cloud (or cloud native) demonstrates that the cloud was the beginning of development, not the end point.

Being born in the cloud infers massive structural cost savings, multiple upgrades per month, models of deployment and implementation that radically lower cost, time and risk; virtually limitless scalability; and so the list goes on.

The cloud solutions touted by enterprise vendors don’t deliver these benefits.  With their older business models and antiquated code bases shoe-horned into the cloud, they are unable to deliver the structural cost savings, scalability, flexibility or agility of their ‘cloud native’ competitors.

The question I ask myself continually is how well understood is the above?  How many people in our industry, outside of CTO’s and alike, really see and understand the difference between the two?  Anecdotally I do see positive signs.  The client base of firms we have built in a few short years, many of which have become evangelists for our model, all have made a conscious choice for FinTech versus enterprise.  All did so, I would argue, understanding the difference between the two.

So, to summarise; critically, and if you recall only one sentence from this blog, please make it this one:  Being on the cloud doesn’t deliver, in and of itself, any benefits to anyone.  Full stop.  Period.

Being on the cloud is not the point.  It’s not the goal…it’s only the beginning.

Enterprise vendors continue to spend millions shoe-horning often poorly suited solutions into the cloud, simply to gain some purchase over the badge ‘cloud based’, to make us believe they are part of the revolution.  I strongly believe, much like my father dancing at a wedding thinking he’s ‘still got it’, these companies are, at the very least, fooling themselves.

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