Microsoft cloud seeds next start up wave

Giant corporation's local arm is offering a hand-up for young, tech-oriented businesses, writes Bill Bennett.

Xero proved New Zealand software startups can take on the world. All you need is a smart idea, an even smarter team and an easy way of tapping into cloud computing resources before the dollars start flowing.

When it comes to the first two elements, entrepreneurs are on their own. Software giant Microsoft is keen to help local start-ups with the cloud part.

BizSpark is a five-year old Microsoft initiative that supports young tech-oriented businesses. Companies that sign on to the programme get free software, including development tools and free use of Microsoft's Window Azure cloud services. A little background promotion and community activity is thrown in for good measure.

Nigel Parker, who oversees Microsoft New Zealand's BizSpark programme, says start-ups stay on the programme for up to three years. Those who hit more than US$1 million in sales, go public or get snapped up in an acquisition have to move on. The rest move on to graduate status where Microsoft sends them on their way with the right to carry on using the software.

To date some 655 New Zealand companies have joined BizSpark and 212 have graduated. The graduate roll call includes some of the brightest young stars in our tech sector, among them are: Pingar, GreenButton, Find.ly, TranscribeMe and Timely.

Parker says: "Microsoft is a large company. People have become skilled at basing their businesses around the opportunities we create. In some cases they do very well. Rod Drury got his start as New Zealand's first representative on the Microsoft MSDN Regional Director programme.

He says that in the past those opportunities were in software development, first for the desktop, then web apps and more recently mobile apps across devices. There was e-commerce and building web content. Now things have moved on to the point where platform-as-a-service (PaaS) is the cutting edge.

Parker says the big opportunity is no longer in developing software from scratch but in solving problems by assembling new services from smaller building blocks. He says: "This might be something as simple as adding someone else's accounting service to an existing app. Most of the time you don't even need to worry about operating systems or programming languages."

If you spend a lot of time online, you'll see how this works with identity management. In the past, each site would ask you for a unique user name and password.

Now, many sites allow users to sign-up using their Facebook, Google, Microsoft or Twitter identity. It neatly shortcuts what would otherwise be a time-consuming, irritating process. Parker says the sign-on process is simply a component that developers can quickly plug-in to their PaaS systems.

Another advantage of the PaaS approach is that apps automatically scale. That is, the same systems that can serve a handful of users are instantly able to deal with a million customers if there's a spike in demand. In the past, companies wanting to handle these loads would need to buy enough capacity to handle peak demand and have them sit idle the rest of the time. Today, they can just buy the capacity they need.