Software Startup on the Cheap? Microsoft Announces BizSpark
I read a post on TechCrunch this morning about Microsoft's newly announced BizSpark program . In a nutshell, Microsoft created BizSpark to help out software startups who are building Software as a Service (SaaS) solutions. BizSpark participants get the following benefits for three years from enrollment:
- Access to all tools required to build the software solution (Visual Studio, Team Foundation Server). There is no limit to the number of licenses for the development team.
- MSDN Premium licenses
- Production licenses for Microsoft products required to host the solution (Windows Server, SQL Server, Sharepoint Server, etc.).
To qualify, the company must:
- Be privately held
- Have existed for less than 3 years
- Be recommended by a 'BizSpark Network Partner'
- Have less than $1MM in annual revenue
- Be building a SaaS solution
There's no question that this program represents significant value to the software startup. It seems to be a concise, less bureaucratic replacement for the Empower ISV program that is already in place (at least for those building SaaS solutions). What is not clear is whether or not the involvement of 'BizSpark Network Partners' necessarily implies some sort of VC involvement early on - a real problem for the team that is attempting to bootstrap themselves. Also, it's clear that Microsoft is not doing this out of some sort of altruistic interest. As several have noted in replies to Arrington's TechCrunch post, free software solutions to build SaaS solutions have existed for several years - although these alternatives are not Microsoft technologies. This solution should have its greatest appeal to those startups who are already familiar with or committed to Microsoft technologies. Developers currently using Ruby, PHP or MySQL aren't suddenly going to drop those tools because of this program.
Nevertheless, I agree with Arrington that this is a brilliant move by Microsoft. Making it easy (and cheap) for developers to build software using Microsoft technologies will only help Microsoft in the long run - even if those startups don't make it big. [Disclosure: I own a few shares of Microsoft stock.] Microsoft has always understood the importance of the development community to their success. This is just one more way to encourage developer familiarity with their products. I also believe that this program dovetails nicely with Microsoft's direction with cloud computing solution - Windows Azure (read my post on that here ). It will be a natural evolution for companies graduating from the BizSpark program to transition to Azure as a cloud hosting solution for their (hopefully) successful SaaS solutions. Microsoft is getting its groove back and moving aggressively in this space. Competition is always healthy.
