1. Product companies
There are many different companies in the IT industry, and there are no clear boundaries. Large companies often do many different things, some of which are definitely IT, and others are definitely not IT. A company is considered an IT company if it gets most of its revenue from IT products. Or if it simply owns several large, well-known IT products.
In the IT sphere, every year thousands of companies appear, grow, and die (let’s be honest). The founders’ goal is to make sure the company does not die, but grows large enough for its stock to become an object of trading on an exchange. Why is this needed?
If a company has done an IPO (gone public), the founders may not need to sell shares (and pay large taxes) and can, for example, take out a loan secured by their shares while keeping the shares. Or they can pay employees part of their salary in cash and the other part in stock.
You can reward top management with stock for excellent results. You can even buy out competitors with stock — a very profitable way to acquire dangerous but still small competitors. For employees, receiving salary in stock can also be very beneficial. First, it saves on taxes; second, you can become very wealthy.
2. Modern IT products
IT companies grow quickly on investors’ money. Investors generally like it when companies grow quickly. “You don’t even have to make money — just grow” ©. “Get 100M users, and then we’ll figure out how to make money from them.”
As they say: “A human + technology will beat a human without technology,” and “A businessperson + investments will beat a businessperson without investments.” The main thing is growth. Very fast growth.
3. Modern development
Companies must grow quickly, products must gain users quickly, and what about the team? The team must constantly add new features to the product.
50 years ago, when software development was just emerging, it was treated like construction. First came the requirements estimation phase, then the design phase, then development, testing, and only after that was the product delivered to customers. From the start of development to the first customer, 5 years could pass. Now everything is different.
Modern development is constant experimentation. Large companies constantly test new features. New product versions come out every month, every week, or even every day.
Facebook outdid everyone by releasing several dozen new “features” every day. Each such feature is shown to 1% of users; then users’ reactions to it are automatically analyzed. If users like the feature, it is shown to 10%, and so on.
Of course, this approach to adding new features requires a completely different approach to software development than it used to.
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