Firstly, Gitlab is going after basically “greenfield” business.
There is no “greenfield” in software development tooling. Everyone is using something they bought or got for free.
The main target is Do-It-Yourself DevOps/DevSecOps tools which are obviously inferior to modern tools.
Huh? NOBODY today is writing their own development tooling. Most developers are using modern, and free, open source tools, such as (for examples) GitHub for free repositories, Jenkins for free CI/CD/DevOPs, BugZilla for bug tracking, etc. If they’re writing anything DIY, it’s merely integrations of these tools with other business tools the company has. No-one writes their own CI/CD environment. No-one writes their own code repository. No-one (anymore) writes their own bug tracking/reporting tool. They take what’s open source first and only if necessary do they modify it. For tools like Jenkins, there are thousands of available plug-ins to help with customization, for instance.
And then if companies want, they can pay for any of a number of available products in the market, including pay for versions of the free tools, and remember pricing for other tools is often not per developer (see JFrog for instance).
I mentioned in my earlier post that this is a fast-moving world where the current “best of breed” changes rapidly and that free open-source tools are the primary backbone for many companies. An example would be how the free open-source tool Kubernetes came on the market and eventually killed the biggest profit center for Docker. Whether this was a total business blunder on Docker’s part (some think Docker gave too much away in their free tier), or an understanding the market better blunder (some think Docker put too much effort to support its own orchestration product Swarm instead of Kubernetes) — doesn’t really matter to my thesis that it’s hard to make money on any kind of sustained time period in this business. Making this even more confusing is that Kubernetes in practice isn’t actually free - it needs to be hosted somewhere in a cloud. Amazon does this, for instance, with its Elastic Kubernetes Service (EKS).
These are complicated products that only highly technical engineers truly understand and use. Those engineers are not loyal to their tools: When an software engineer goes on interviews - or heck just talks shop with other engineers at different companies - it’s considered a bad sign if the engineer isn’t up on the latest development tool to hit the market, and worse if he’s still promoting some few-year old tool from which the “smart guys” have moved on from.
This is not an easy business to be in. It’s tough to compete with free, especially when free is mostly very very good and the customers themselves have the skills to not just customize, but even modify as needed.