BONUS LAW: You can ignore one or two of these rules, but not more.

October 2012
Authors: Felda Hardymon
Related Strategies: Cloud Computing

You might be reading this and saying to yourself, “But wait – we’ve got a great channel partner that is going to take us to the moon!” or “I took an early chance in Europe and it’s now driving the majority of growth for my entire business.”  To which we would say “good for you.”

Larry Ellison*
CEO, Oracle
(NASDAQ:ORCL)

“I thought the cloud was just water vapor until I read Bessemer's 10 Laws of Cloud Computing. I now realize that I may have been insensitive and a bit closed-minded in my criticisms. Armed with this secret playbook, I can now destroy SAP's entire legacy software business with a single press of a button from my island fortress in Hawaii, while still surfing Pinterest with my left hand.”

*[Ok, we made that one up. But he might be thinking it!]

Nothing is absolute, and we certainly believe it is possible to ignore one or two of these core tenets and still succeed.  In fact, several of the companies we have worked with have also chosen to break one of these laws at some point in their lifecycles with success.

If you find yourself questioning several of these Ten Laws, however, it’s probably time to step back and take a hard look at your business. As former Cloud CEOs and investors ourselves, we have learned the hard way that much of the battle is just learning from the mistakes of those who went before us. In our analysis of hundreds of cloud businesses, we encountered several successful companies that were on the borderline with one or two of these laws, but none that successfully challenged several of them.

We hope that you can benefit from some of these best practices we’ve learned through the years and these “laws” can help you run your cloud business more effectively. If you have thoughts, edits, or additions, please send them over to cloudvc@bvp.com as we always welcome new input!

For a PDF of Bessemer's Top 10 Laws of Cloud Computing and SaaS please click here.