Patio11's Law: The software economy is bigger than you think (secondbreakfast.co)

Article summary

The article discusses the concept of 'Patio11's Law', which states that the software economy is bigger than people think. It highlights the existence of many small, successful software companies that operate quietly in the background, often unnoticed by the mainstream tech media. These companies can be highly profitable, with some generating millions of dollars in revenue each year. The article cites examples of such companies, including ConvertKit, which has $20 million in annual recurring revenue and only 48 employees.

Main themes

• software economy
• small businesses
• enterprise software
• venture capital
• geographic barriers
• market stability
• operational risk
• business transformation

What commenters say

• Many small software businesses are successful and profitable, but remain unknown to the general public because they don't receive mainstream tech media coverage.
• The software economy has fewer geographic barriers, which can lead to winners taking a larger share of the market, making small software businesses less stable.
• Some commenters believe that finding problems to solve for small businesses can be difficult, but when found, can lead to valuable solutions.
• Others argue that small businesses often need simple solutions, such as website development or automation of basic tasks, and that these opportunities can be lucrative for developers.
• Venture capitalists often prioritize companies with high growth potential, leading to a focus on billion-dollar companies rather than smaller, more stable businesses.
• The process of implementing enterprise software, such as ERP systems, can be complex and disruptive, but may ultimately lead to increased efficiency and competitiveness for businesses.
• Some argue that the value of enterprise software lies not just in the software itself, but in the workflows and best practices that come with it, which can help businesses operate more efficiently.
• Others suggest that the decision to implement enterprise software may be driven by a desire to minimize operational risk, rather than a specific need for the software's features.