Creating Value (And Getting Paid) In The Sugar Crm Ecosystem

David O’Keefe Lampada Global Services

Target audience: SugarCRM Partners, potential partners, ISVs and developers
Objective: Discuss the business of working with SugarCRM
Focus:
VARs / Integrators
ISVs with Value-added Products
Independent Developers
Copyright @ 2008 Lampada Global Services. All Rights Reserved.

Eric S. Raymond - The Cathedral and the Bazaar: Musings on Linux and Open Source by an Accidental Revolutionary
“ The Linux world behaves in many respects like a free market or an ecology, a collection of selfish agents attempting to maximize utility which in the process produces a self-correcting spontaneous order more elaborate and efficient than any amount of central planning could have achieved. ”

Platform
Apache
PHP
MySQL / Sun Microsystems
Zend
Microsoft
Oracle
Yahoo! – UI Library
Various OS Tools / Components – e.g. PHPMailer
Big Customers
Google (?)
Yahoo!

VAR / Integrator - Implemention & Consulting
Most SugarCRM partners worldwide
Maintenance / Tech Support / Training
Support is a very different business than software development
Documentation Writer
Good fit with Training and Support
Can also be a form of marketing

Value-added Product for SugarCRM (ISV)
BrokerSuite – Blue River
CallRoom – AnySoft
Info@Hand – LongReach
ZuckerReports – Go Mobile
Q-Connector - RPS Systems
Mobile Edge for SugarCRM – iEnterprises
VoiceRD (VOIP PBX/CRM Appliance ) – Novacoast
SugarCRM OEM – Harte-Hanks
SugarCRM Professional Vertical Market Solution

Hosting / Datacenter
Wide range of prices
Translator / Localizer
A service to the community
Great marketing / positioning
Packager
BitRock
Advocate
Size matters in software communities

Independent Developer
Farkhad Rakhimzanhov – working w/Lampada
Employed Developer
Euclides Rodriguez – Wunderman, Colombia
Ken Brill – also worked independently
SugarCRM Fully Loaded
Active End User
Rick Crites
End User

Opportunities
Worldwide demand for SugarCRM skills
Lower license costs = Higher project margins
Various money-making roles:
Consulting
Business Process / CRM Consulting
Project Management
Integration
Web portal and ERP Integration
Hosting
Training
Support / Maintenance
Product – projects can lead to marketable products

Threats
People
Worldwide shortage of SugarCRM skills
Internal training cost - SugarCRM learning curve
Sugar versioning – complicates skills issues
Project risks
Requirements / Change Management
Sell the Requirements Phase
Scope Creep = Margin give-back
Imposing process is easier in theory than in practice

Threats
Project risks
Estimation: 2 x time estimate = loss
Quality control: rework reduces margin
Long tail
Support without a support contract
Little changes are expensive
Contract risks
Payment terms – Net30 is a form of financing, PayPal takes 4%
Indemnity clauses – hidden risk
Legal Jurisdiction – suing is rarely worth the money, getting sued can be disastrous
Work for Hire – Intellectual Property

Standardized Process
Requirements checklist
Setup development environment
Develop according to requirements
Q.A. testing (20 – 50% of dev. hrs)
Packaging (and package testing)
Deployment
Training
Support
Charge a standard Setup fee
Include an Acceptance clause in your contact, with a time limit for sign-off

Standardized Process (CMMI, PMBOK)
Requirements checklist
Integration mapping (fields, options, workflows)
Setup development environment
Risks: Networking, access, undocumented systems, highly configured servers
Tools: Jitterbit, Talend
Develop according to requirements
Deliver in phases the client must formally accept
Q.A. testing (30 – 50% of dev. hrs)
Packaging (and package testing)
Deployment (estimate risks)
Training (almost always necessary)
Support (the Long Tail, adjustments are inevitable)
Sell each phase, especially Requirements and Support
Include an Acceptance clause in your contact, with a time limit for sign-off

Opportunities
Worldwide demand for SugarCRM
Diverse needs (niches) to serve
SugarCRM can be component of bigger product
Info@Hand / CallRoom
BrokerSuite
SugarCRM is a development platform / framework
Product can extend SugarCRM
ZuckerReports
Teams OS / Teams 5.0 CE
Product can integrate SugarCRM w/ devices or software
Q-Connector
Mobile Edge for SugarCRM

Since 4.2.1, 15,000+ downloads
Some of the most active threads in Sugar Forum
Significant development, QA and versioning costs
THE VALUE-ADD
Teams is a critical feature for many organizations that only want or can afford Sugar OS or CE
THE PAY-OFF(s)
Lampada got paid to develop first version and got credibility by releasing it and maintaining SugarForge project
Ken Brill created and sold Sugar Fully Loaded, became famous and got a job at SugarCRM
Euclides Rodriguez has established himself as a technical resource in the community.
SugarCRM stays in the game with customers not ready for Pro

Very active forum thread / poll
Almost no contributions to Fundable
GPL 3.0 complicates selling it
Significant development, QA and versioning costs
Several offers to fund development as part of larger projects
THE VALUE-ADD
Teams OS users cannot upgrade to Sugar 5.0 without a new version of Teams.
5.0 MVC architecture creates an opportunity to improve Teams
VARs can install, configure and customize it
THE PAY-OFF(s)
Lampada seems likely to get paid to develop it and will get good marketing from it
Sugar stays in the game with customers not ready for Pro

Offered by RPS
Connects SugarCRM to Quickbooks
SugarCRM Professional (market limiter)
Not Sugar OnDemand compliant (market limiter)
Significant development and versioning costs
THE VALUE-ADD
Easy integration of SugarCRM with Quickbooks
THE PAY-OFF(s)
RPS gets product revenue, as well as marketing which drives services revenue
Sugar gets a compelling reason for customers to buy Pro / Enterprise

Forking a good OS project is bad
Bad business, maintenance costs pile-up
Bad for community, dilutes skills and contributions
CRM is a niche
SugarCRM is a smaller niche
Harness the Internet to size up your niche (Sugar Forum, Orkut, email marketing, etc.)
Some niches are too small...
User testing is valuable
Users are better testers than developers

Tim O’Reilly: Data is the Next “Intel Inside”
Users’ data can be part of the value they add
Owning a unique, hard-to-recreate source of data may lead to an Intel-style
SugarCRM for medical clinics: capture prescription data
Understand Service as “Software as a Service” as well as “Services in Support of Software”
“ Selling” is a bigger commitment than “Releasing”
Build a Brand that stands for Quality

SugarCRM Silver Partner
100+ Sugar projects worldwide, since 2005
Offshore partner to various SugarCRM Partners
David O’Keefe
[email_address]
+55 11 3237-3110
Skype: dtokeefe

Creating Value (And Getting Paid) In The Sugar Crm Ecosystem

by David O'Keefe on Apr 02, 2008

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Creating Value (And Getting Paid) In The Sugar Crm Ecosystem — Presentation Transcript