Positioning a Generative AI Startup: Erik Severinghaus, Founder and CEO of Bloomfilter (Part 5)

Sramana Mitra: Great. Let’s kind of role play through this and tell what you pitch to your VCs from a TAM point of view. What is the positioning? What segment are you going after? What use cases are you going after? What is the pricing model? What is the business model or the pricing model? 

Erik Severinghaus: So, the TAM is pretty straightforward, which is that everybody’s building software. Software is eating the world, and 78% of software is late, over budget, or isn’t shipping at all.

So when you think about the world of teams that are building software, whether those are publicly traded companies, privately held, private equity owned. The problem statement tends to be fairly similar company by company. By the way, we could take this over to consulting companies as well that are building software for their customers.

Sramana Mitra: Infosys, Tata?

Erik Severinghaus: Yes. Infosys, Tata, Wipro, Accenture, all the way down to the small ones.

Sramana Mitra: It’s better than private equity use cases.

Erik Severinghaus: There’re a variety of different use cases. I take your point on that. So when you start to think about this massive market of software development, you start to realize how poor the outcomes typically are, then you start to look at that and wonder why are we spending this much money. Why is such a high percentage failing to ship on time and on budget?

We’re not the first ones to think about improving this, but nobody has an end-to-end view of what’s happening inside their software process. Whether you’re in a publicly traded company, a private equity owned, privately held, if you go to the chief technology officer and ask for a step-by-step view of what’s happening within their software development lifecycle, pretty much nobody has a robust observability into that process. I’ve seen this in the boardrooms of many different companies that I’ve been in.

The fundamental thesis, is that we can improve the outcomes in this massive market by improving process observability. By making the process more observable, we can make it more predictable and efficient.

So then you get into the how. How do you actually make that happen? Because it sounds like motherhood and apple pie. Everybody likes it. Now, how do you actually do it?

So, when we get to the what are we building? It is this ability to connect into all the different systems that people are already using.

Use AI to stitch the process together so you can understand where it is, where it’s going well, and where there’re issues. Then we create a roadmap for improvement to be able to help the firm understand where the problems are and where we can improve.

Sramana Mitra: At this point, I like the problem statement, the solution, and the segmentation. Software development companies, even IT inside of Fortune 500, Fortune Global 2000, and mid-sized companies, basically everybody doing software development has process issues. I like that positioning, but I don’t like the private equity positioning at all.

This segment is part 5 in the series : Positioning a Generative AI Startup: Erik Severinghaus, Founder and CEO of Bloomfilter
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