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Foreign countries have ran over $1 billion in unicorns.

IT technology supports the global wave of informationization, but the efficiency of software development is not as fast as Moore’s Law, so it becomes a bottleneck.

In recent years, the low-code field has developed rapidly, and the track has run out of the one-dollar valuation of over $1 billion. Beast OutSystems, giant companies AWS, Google, Microsoft, Oracle, Siemens, etc. have also launched low-code development platforms or low-code through acquisitions. A number of low-code startup companies have emerged in China, with early venture capital opportunities.

Low-code development platform is a tool that can quickly generate applications without coding or with a small amount of code. On one hand, it can reduce the labor cost of enterprise application development, on the other hand, it can develop in the past several months or even years. Time is shortened to help companies realize the value of cost reduction and efficiency and flexible iteration.

In recent days, interviews, research, product trials, etc. have been conducted for more than ten low-code related companies, including many low-code startup companies, UF, Sales Easy, Beisen and other enterprise software and well-known SaaS companies, OutSystems, Mendix and other overseas heads. Ministry and so on. I finally wrote this article, some of the core information includes:

Low-code development method can increase software development efficiency by several times or even more than 10 times;

The low-code track is getting hot, and foreign countries have ran over $1 billion in unicorns. It is estimated that the platform market will reach $15.5 billion in 2020;

Analysis of five key points in low-code track competition: platform capabilities, business models, business capabilities, ecological construction, financing capabilities;

The low-code field is in the early stage of exploration, and it is not too late to enter the business. The valuation of startup companies is mostly within 200 million yuan, with early investment opportunities;

RPA, BPM, middle platform, low code, behind a trend.

Do not write code to quickly develop applications, increase development efficiency by 10 times

1. Concept and value of low code development

We will first come to a few examples to visually understand the value of low-code development:

OutSystems helped Schneider Electric launch 60 applications in 20 months, which doubled the development process and saved 650 days of work in the first year alone.

ClickPaaS tells that a traditional chemical enterprise customer, originally built an overall information architecture through Oracle and SAP, including CRM, DMS, OMS, ERP.After the business model changes, the original plan needs to be refactored. The solution reconstructed on Oracle and SAP originally implemented the company’s offer in 6 months, 4 million yuan. Replacing CRM, DMS, and OMS with ClickPaaS’s rapid build business model took only one month and 700,000 yuan in annual rent.

Yichuang Technology told us that a real estate agent has set up an overseas service sector system. The traditional development method requires 12 people to develop for 6 months, and the price is several million yuan. Yichuang is based on a low-code development method, and 4 people have completed the delivery in one month. The project amount is several hundred thousand yuan.

The efficiency improvement comes from the low-code new application development method: Developers can use drag and drop, parameter configuration, logic rule definition, template component call, etc. based on graphical interface. The way, at the same time compatible with the code writing mode, complete the software application construction, the development efficiency is increased several times or even more than 10 times.

There are often zero code (no code) mentioned with the low code. Zero code means that the application development is not written at all, and the development scenario oriented to it is often simple.

Specially, The low-code development platform discussed in this article refers to a broad-based low-code development platform that contains low- and zero-code, and includes modules that support low-code rapid development. It includes a generic PaaS layer, middleware, aPaaS layer, iPaaS layer, components, templates, and the like.

OutSystems’ low-code development interface (Source: OutSystems official website)

2. How can low code development improve development efficiency and reduce costs?

Efficiency First, by graphically dragging and dropping, instead of writing the original code, you can reduce the amount of work. Second, the way to write code often takes a lot of time to find code bugs and solve bugs. Low code because it rarely needs to write code directly, thus effectively avoiding the bug of the code itself. Third, support the development of one-click deployment of applications to multiple environments, including PC client, web, mobile, and IOS, Android, H5, applet and so on. Fourth, through the development of cloud-based development process and version management, synergy efficiency can be improved.

In addition, Yichuang Technology CEO Yibo also told that the traditional code development, the shortening of the total development time is not directly proportional to the growth of the input manpower, the traditional development is tight coupling, serial development mode, ie Developers need to work closely together, coordinate, etc. Many development links need to wait for the previous link to complete. The key point of Yishang low-code development platform is that the underlying core technology has changed from tightly coupled MySQL, Java, etc. to loosely coupled NoSql, JavaScript, etc., thus achieving serial development to parallel development.

Cost aspect, the cost of software application development is mainly labor cost, usually measured by “people” or “person month”, you can follow this Formula to calculate: development cost = daily average salary of personnel * number of people * development days. The increase in efficiency directly proportionally reduces the value of “number of people, development days”, while low code development mode reduces the level of developer requirements, and many development work does not It takes so expensive high-end development talents to do it, which also reduces the “average daily salary” value, thus reducing overall costs.

The low-code track has ran out of unicorns abroad, and the platform market reached $15.5 billion in 2020

Low-code development is often seen as a “toy” in the early days, and it is difficult to land in actual production scenarios. In recent years, with the gradual development of technology and market, the field of low code development has gradually become “hot”.

In June 2018, the low-code development platform OutSystems received $360 million in financing from KKR and Goldman Sachs It is worth more than $1 billion and becomes a unicorn. Its annual revenue is well above $100 million and its annual growth rate is over 70%.

In August 2018, Siemens announced the acquisition of a well-known company in the field of low-code application development, Mendix, for 600 million euros.

AWS, Google, Microsoft and Oracle have also launched their own low-code development platforms in recent years.

Look at the country, Aojie Network, ClickPaaS, Yichuang Technology, Digital Technology, Light Stream, Getting the Cloud and other low-code startups are also In 2018 and 2019, they have received investment. Among them, Aozhe has received A$50 million A+ round investment from Ali and a billion-yuan B-round investment from Gaochun Capital.

In the first half of 2019, Mingdao released a new product, Mingdao Cloud, and transformed into a zero-code development platform; APICloud released a low-code development platform Plus Mode.

Market size, Forrester report shows that the market for low-code development platforms will grow from $1.7 billion in 2015 to $15.5 billion in 2020, and by 2020, 75% of applications will be Developed in a low-code platform.

It should be noted that the $15.5 billion market estimate here refers only to the low-code development platform market, while the market based on low-code platform services is not included.

Two main players: Head SaaS Enterprise, Universal Platform Enterprise

Gartner proposed the concept of hpaPaaS (High Productivity Application Platform) in the 2018 report, ie a cloud platform that supports rapid development, deployment, and running applications, core capabilities Focus on low code and zero code development.

The picture below shows the magical quadrant of hpaPaaS drawn by Gartner in the 2018 report:

Source: Gartner Report

You can see that there are four companies in the “Leaders” quadrant in the upper right corner: Salesforce, ServiceNow, OutSystems, and Mendix. These four companies also represent two core players in the global low-code development platform: the head SaaS enterprise. And a common platform enterprise.

1, Head SaaS Enterprise

Head SaaS and application software companies, the direct driving force for low-code development platforms is: improve product development and custom development efficiency. The long-term driving force is: to establish a platform ecosystem.

Representative companies include SaaS leader Salesforce, ServiceNow, etc., and well-known SaaS companies in China, such as Sales Easy, Beisen, and old-fashioned application software UF and Kingdee.

SaaS companies need to quickly iterate their products while expanding more product lines and capabilities to cover a wider range of business scenarios, involving a lot of product development efforts. On the other hand, medium and large customers tend to bring more revenue to SaaS companies, but standardized SaaS products can’t meet the needs of big customers. SaaS companies need to do a lot of customized development for each big customer. For the “project company.”

The low-code development platform can effectively solve the above problems, reduce product development and customized delivery costs of SaaS and software companies, and improve overall efficiency.

The low-code development platform of the head SaaS enterprise, with reference to the successful experience of Salesforce and ServiceNow, has a clear development path:

• The first step is to use the platform for internal development productivity improvements, including continuous product development and customized delivery.

• The second step is to provide the platform to customers and integrators/agents, enabling customers to continue to meet their business iterations and individualization needs based on secondary development of the platform. Enable integrators/agents to perform secondary developments based on the platform to meet customer customization needs for fast, low-cost delivery.

• The third step is to open the platform to the third-party application developer ISV, build a new application on the platform, and sell the platform traffic to the platform customers, thus breaking through the SaaS enterprise’s own business scope. Platform application ecology. Or directly sell the platform to the ISV, independently develop and deliver ISV’s own application software.

Salesforce has implemented the third step, typicalThe case is Veeva’s Salesforce-based application development platform Force.com, which has developed a CRM system for the medical industry with a market capitalization of more than $20 billion.

2,Common Platform Enterprise

The head SaaS company is the first business, and then created a low-code development platform to support its business expansion, as well as longer-term ecological construction. Universal platform companies first create platform tools and then provide them to all (ideal) application development scenarios.

Low-code development platform is a tool for the head SaaS enterprise. It is a core product service and a new business model for the general platform enterprise. I hope to pay more attention to new opportunities and new trends in venture capital, limited by space. Later, the focus will be on the research and analysis of general platform companies.

Common platform representatives include OutSystems and Mendix from abroad. Domestic companies include Aozhe Network (Jinyun), ClickPaaS, Yichuang Technology, Yanhuang Yingdong, Digital Technology, Light Stream, Cloud, Blackpool Low-code startups such as cloud and easy-to-use software, as well as startups that extend or transform into low-code areas such as APICloud and Mingdaoyun, as well as business modules of large enterprises, such as Fanjian’s Jiandaoyun and Ali’s. Joget and other overseas companies that are expanding into the Chinese market.

How do you further differentiate the common platform companies? What are the key points of the track?

We have been able to measure from the following five dimensions:: platform capabilities, business models, business capabilities, ecological construction, Financing ability.

• The platform capability determines how much application value the platform can provide (how many times the development efficiency is increased and how many times the cost is reduced);

• Business model determines how much business value can be translated into;

• Business ability directly affects the ability of customers (especially large customers), and determines how much business value can be reached;

• Ecological construction refers to the platform’s tutorial, training, help support and community building, which directly affects the platform’s promotion speed, promotion cost and brand;

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• Financing ability is very important because high-quality low-code development platform development is a high-investment (years, hundreds of millions), high thresholdFeelings, in the early stage, it is necessary to continue to burn money until the commercialization of the platform results in stable revenue.

We will analyze in detail the two more complex key points of platform capability and business model.

How do you measure the platform capabilities of a low-code development platform?

The platform capability core determines two things, and is the core value of the low-code development platform: the ability to develop applications with multiple scenarios and multiple complex scenarios; how much development efficiency and development costs can be optimized.

These two points determine how high the ceiling of low-code companies is, how strong the product is and how competitive they are, and whether they have the ability to service complex scenarios of large customers.

A key question is coming: How do you measure platform capabilities?

We believe that we can measure from two perspectives, one is measured from the technical path and architecture of the platform, and the other is measured by the application effect of the platform.

Technology path, we conducted interviews with a number of general low-code development platform leaders in China, as well as platform product technology leaders who sell Yi, Beisen, and UFIDA, and reached the following conclusions:

Large level, You can divide low-code development platforms into two categories according to the technical path architecture:

• One is a form/engine-driven model that builds a form-like light application by creating multiple forms, using process concatenation, defining report output methods. The technical barriers of this type of mode are not high, mainly supporting the development of form-based applications. The scenario has certain limitations, mainly serving small and medium-sized customers.

• One type is based on the aPaaS platform model, including a variety of specific technical means and paths, such as model-driven, code generation, visual programming, etc. The underlying technology involves cloud native, metadata, multi-tenancy and so on. This type of model has higher technical barriers, finer granularity, higher complexity and flexibility, and can support complex application development in a wide range of scenarios, with the ability to serve large customers and small and medium customers. However, such platforms are often difficult to further divide a few clear technical genres, often each one has a big difference.

Looking at another perspective, measured by the application performance of the platform.

First of all, you can directly see the core value of the platform to achieve results, namely:

• Successfully delivered a large number of customers. How many industry and domain application development scenarios can be covered in the horizontal breadth, and multiple complex application scenarios can be developed in the vertical depth.

• The development of these application scenarios can be completed in a low amount of people, reflecting the extent to which development efficiency and development costs can be optimized.

In addition, sales executive CEO Shi Yanze and product vice president Ye Xiaoyu also added 3 points: (Ye Xiaotong was the product director of Netsuite (now Oracle Cloud ERP), and built the Siebel CRM application as a project leader at Siebel. Engine)

• How many ISVs are based on the platform for native app development, and how many apps are generated and how high the quality is.

• The ability to process customer data volumes (sales can easily support billions of dollars in a single tenant).

• Certification of international standards bodies, such as the list of recommended vendors for the Gartner Efficient Development Platform.

Five business models, looking for low code value exports

The low-code development platform is essentially a tool that generates core application value of “improving development efficiency and reducing development costs.” How to find the best value export, how to transform this “tool” into considerable business value is crucial to the success and failure of the startup and the future volume.

More specific, which involves whether the selected industries and scenarios have enough pain points, how high the customer’s ability to pay and whether the payment channel is smooth, how much profit margin is, whether it can scale expansion, and whether the marginal cost of expansion is sufficient. Low, how high the ceiling is in this mode, whether it can form higher barriers, and so on.

After research and analysis, we will summarize the business model of the low-code development common platform, which is initially summarized into the following five categories:

• Become a form-based light application development platform. Including the rapid construction of lightweight ERP, CRM, invoicing, project management, OA, etc., the advantage is that it can enter the market faster and lighter, the user threshold is low, the problem is to support development The application scenarios are limited, most of them serve small and medium-sized enterprises, and the technical barriers are not high.

• Become a developer of enterprise IT projects. There is a huge software outsourcing development company on the market, which is followed by the huge demand for enterprise IT project construction. Since you have powerful tools, you can directly undertake the business outsourcing development needs, can shorten the development time several times than other companies, reduce the development cost several times, and thus have a great advantage in delivery time and quotation, while customers can Continue to build applications quickly based on the future of the platform. The problem with this model is that it needs toWith a large amount of customer resources and familiarity with customer business, in the delivery process, a large number of consulting work will be involved to sort out the customer’s business processes. Of course, it is also a path to make the scale yourself first and then become a high-productivity crowdsourcing platform with the core development tools.

• Enable consulting companies, integrators. Do not directly face the end-users to do the project, but provide consulting companies, integrators, outsourcing companies, etc. for direct service terminal customers, and provide them with low-code development platform tools to generate revenue. Such low-code companies do not have to compete for their own accumulation of less terminal large customer resources, do not spend a lot of time on customer business consulting and demand combing, can scale faster, and use the channel to quickly enter the platform to more customers. Extend potential customer service. Under this model, the platform should be easy to use, reduce the threshold for use, and must be well trained and supported by the system to make the channel merchants willing and easy to use. At the same time, the level of channel providers is uneven, which will directly affect the landing effect of the platform, which in turn affects the brand image.

• Enable medium and large SaaS companies. The previous article has analyzed that the low-code development platform can effectively solve the painful point of SaaS enterprises in the rapid and low-cost development of iterative product lines and functions, responding to the needs of large customers. The head SaaS company will have a high probability to develop and construct the aPaaS platform. The medium and large-scale SaaS companies with the second largest scale are often difficult to make long-term and high-cost to build their own. It is a better way to directly purchase mature platforms. However, the big problem here is that the vast majority of Chinese SaaS companies are in dire straits. The first stage of customer sales has not been solved, and there may be insufficient determination in building aPaaS.

• Become an enterprise mid-office solution provider. Based on a low-code development platform, it helps enterprises to build complete business mid-media and data-in-a-media capabilities, and completes the development and iteration of all business applications of enterprises in a fast and low-cost manner, while flexibly and quickly responding to external changes. Let low-code mid-station become the entrance of enterprise information construction and intelligent application, and extend the larger imagination space such as application mall platform. At present, China Mobile is still in the early stage of landing. This model needs to find the strongest corporate customers, and it will also face competition from existing mid-range solution providers.

The above five major business models can also be considered from another dimension: whether it is a direct sales platform tool, a tool sales service, and what services to sell.

Low-code venture capital opportunity: start of business is not too late, investment has early opportunities

The domestic low-code development general platform players, most of them started related business after 2014, the overall development is very early, still in the initial stage of product, commercial exploration stageSegment, The revenue is mostly at the level of several million yuan and ten million yuan.

At present, Aozhe Network is a top-ranking enterprise in the low-code field in China, and we have also made detailed reports. Aozhe was founded in 2010. cuts into the process management field with BPM products. In 2014, it launched the public cloud BPM product “Jinyun”. In 2019, it launched the “low-code platform “cloud hub” with the concept of “business in the middle”.

Aojie Network’s revenue in 2018 has exceeded 100 million yuan. Its business logic is that the lightweight zero-code product “Jinyun” is based on the nailing platform to obtain a large amount of customer traffic, and some will have more demand. Large enterprises, which are diverted to BPM and cloud hub business, earn business income of high customer unit price.

Comparing with foreign head companies, OutSystems currently has more than 400 corporate customers in 25 countries, including Toyota, Logitech, Deloitte, Schneider Electric and General Finance, and ARR (annual recurring income) is well above $100 million. And annual growth rate of more than 70%, the valuation of more than 1 billion US dollars.

In contrast, domestic startups still have a lot of room for growth. Currently, the valuations are mostly within 200 million yuan, several times PS, there are reasonable early investment opportunities, and most low-code startups. Are financing….

In terms of entrepreneurial opportunities, although the technical threshold of aPaaS is relatively high, it requires the entrepreneurial team to have years of experience in aPaaS, and has invested in platform construction and polishing time for several years, but the low code development market is still at a very early stage in China. Need for further maturity of technical products and market education, This gives a valuable time window for startups who want to enter the field, so we judge that there are still opportunities for new startups.

RPA, BPM, middle platform, low code, behind a trend

When we looked at BPM, RPA, middle-office, and low-code technology services that seemed to be less relevant, we found some interesting correlations and commonalities.

These technical services are actually responding to a common megatrend: companies need to break through the silos of information systems, quickly iteratively respond to externally rapidly changing market conditions, while reducing costs and increasing internal productivity.

Under this megatrend:

• Traditional BPM builds a system that fits the customer’s business processes based on the existing systems of the enterprise through code development and interface docking.

• RPA is to avoid the intricate underlying development and docking, directly based on the interface operation means, it is a good job to complete a large number of “fixed rules, high repetitive” work, quickly grafting bridges in various systems, forming a new business flow.

• 中台 is to solve the problem fundamentally. On the original system of the enterprise, build data and business in the middle of the platform, and put all kinds of data and business interfaces of these enterprises. Integrated, the unified output of clean, organized and standardized data and business capabilities by China and Taiwan is more like “Chinese medicine” therapy.

• Low code would like to further improve the efficiency of the middle office, and improve the efficiency of the project. Compared with BPM and RPA, the low code can solve the existing system and solve the serial connection problem, and can also directly construct new applications, and the scene is actually wider.

Of course, this is not to say that the future must be the world of a certain technology. In the context of the uneven development of enterprise information, the vast and complex market application scenarios, and the continuous evolution of technology, these technologies will be combined in a suitable way. Convergence, serving the right application scenario.

The fact is already true. Aozhe’s BPM business is rapidly developed and delivered through low-code technology; RPA companies such as UiPath design RPA processes based on drag-and-drop graphical operation, which is actually a low-code application for specific scenarios; The code provides a mid-range solution; Light Stream also integrates RPA tools into a low-code solution.

In the end, everything comes down to a fundamental question: why customers, what scenarios, what core values ​​are offered, and how much business return. In the final analysis, technology is a tool. As for what tools to use, it is never absolute.

Conclusion

Returning to calmness, we see that the development of low code is still in the early stage of exploration. Even the world’s leading company, OutSystems, was established in 2001. It has been developing for nearly 20 years and its valuation is over $1 billion. A very bright result.

Can low-code development adapt to a wide range of scenarios? How many complex applications do you make? Can the efficiency be doubled or 10 times? How is the business model designed? Selling tools or selling services? What service is it for sale? How to charge? When will the market really come up? and many more. These issues are waiting for low-code startups, companies, investors, etc. to explore and answer.

We will not go to the final stage of the game, whether it will create a new development language, application ecology, and new enterprise information architecture. We also hope that industry practitioners can polish tool tools and truly take root and solve problems., to generate value, not to speculate, create hot spots, blow bubbles.

We are looking forward to a major change in productivity in the field of ancient software development.

In the original intention of growing up with the industry, I wrote this article. Due to limited time, resources, and limited vision, this article will inevitably have errors, one-sided problems, etc. Welcome to correct communication.

I am an analyst, Chen Shaoyuan, who continues to focus on the development of low-code areas. Welcome to communicate with me or seek to report, my WeChat: 963757163, please indicate the company, position, name after adding.