"There are only two ways to make money in the software business: One is to bundle; the other is to unbundle." – Jim Barksdale
There are five pillars of the productivity (and now remote) stack:
- Video conferencing
Microsoft realized these core plinths of the productivity stack decades ago. Word launched in 1983. Outlook launched as Hotmail in 1996 with calendars integrated directly into the email client. With the 2011 Skype acquisition, they got chat and video conferencing. Their main value proposition to customers was simple: they were the canonical throat to choke. With your Microsoft contract, you get all of these applications out of the box (or for some modest incremental fee).
Then came Google. Right before their IPO, legendary engineer Paul Buchheit and his team launched Gmail in 2004, which was Google's first foray into the productivity stack. In 2006 they launched both Google Docs and Google Calendar. The latter took the Microsoft Word form factor, put it online, and enabled users to collaborate in real-time. The former was basically an internet-based calendar. Once they had those pieces in place, they layered in their video functionality with Hangouts which ultimately became Meet.
In many ways, the 2010s was the decade of unbundling. We saw the rise of best-of-class products in different verticals in the productivity stack and looking back, 2012/2013 was a big year for many of these products to launch.
- January 28, 2013 – Zoom launched in 2013 with a Unified Meeting Experience (UMX) cloud platform and promised to make video communications frictionless and secure.
- July 31, 2013 – Slack launched in 2013 promising to "change the way teams communicate" writing that they were selling "organizational transformation." In doing so, they revolutionized the chat vertical.
- July 31, 2013 – Quip launched with the goal of "create[ing] products for work that you actually enjoy using every day." The product was built to facilitate collaboration, interactivity, mobility, and simplicity and was framed as an alternative to an outdated document model.
In thinking about which elements of the productivity stack you'd be able to live with and which you'd be able to live without, video, chat, and documents seem to be the most valuable.
That said, we also saw a number of attempts at building a better calendar including, most famously, Sunrise which was acquired by Microsoft on August 31, 2016.
The lesson from Sunrise was clear: going head-on in the calendar market is a challenging go-to-market motion. You don't bull charge a castle. As such, we saw entrants using the programmability of calendars to deliver calendar intelligence and otherwise reduce the friction out of the calendar.
Calendly, founded in 2010, was created to be a hub for helping reduce the friction in scheduling meetings. The use case was simple: internally you can just look at everyone's calendar and schedule around their commitments but when you are scheduling externally, this becomes much more challenging. The product is basically a calendar integration which lets you determine your availability and share a link which lets people book time on your calendar.
Another calendar intelligence product that has become popular in recent years is Clockwise which was launched in 2016 and became generally available in 2019. Similar to Calendly, Clockwise integrates with either your Microsoft or Google calendar. However, Clockwise adds a smart layer on top of the calendar by letting you add an integration that helps you block uninterrupted blocks of time for you to get work done.
They also offer a Slack app which serves to unify the calendar with Slack. The app automagically changes your Slack statuses when you are in meetings and also gives you a really helpful rundown of your day in the morning.
I've used both products and think they are both great. The difference between the two is that as I've been working remote, I've built a habit around using Clockwise because I check my schedule the night before and use it to block off time on my calendar. Calendly on the other hand is a slick way to schedule meetings externally but sending a Calendly link has become somewhat gauche.
Bundling and Feature Copying
The battle between every startup and incumbent comes down to whether the startup gets distribution before the incumbent gets innovation. – Alex Rampell
Unfortunately, Calendly's big $350mm raise seems to have awoken a sleeping Google. In the first Google Calendar feature launch that I can remember in a very long time, it seems that Google is pulling an Instagram and copying Calendly's Appointment Schedule feature and baking it directly into their core UI.
They are then using this as a wedge to upsell people to a Premium Drive subscription which includes premium video calling and engaging email campaigns. Oh, and guess which video conferencing product is prioritized when creating a Google Calendar invite? I'll give you a guess...it's not Zoom.
In the next year or two we're going to see a live test of Rampell's Hypothesis: will Calendly get distribution or will Google get innovation? With 500mm Android installs of Google Calendar back in 2018, I'd bet on the bundle.