In one more signal that the world is software-driven, Prosus N.V., one of many world’s largest tech funding companies, announced on June 2 that it’s buying Stack Overflow, a world knowledge-sharing platform for builders and technologists, for $1.8B. Prosus already owns vital stakes in on-line schooling corporations Udemy and Codecademy, along with numerous different tech corporations—most notably, Tencent.
I’ve persistently argued in earlier articles that every one corporations should suppose and act like software program corporations. As software program turns into central to the technique of non-software companies, they have to construct core competence in software program. This, in flip, has elevated the significance to builders of maintaining with fashionable software-development practices. With know-how advancing relentlessly, software program builders should continue learning new expertise.
That is the place Stack Overflow is available in. Regardless of whether or not you’re a rookie or a talented software program developer, you will run into issues which you could’t clear up by your self. Not like most on-line studying corporations that provide programs and certifications in particular domains, Stack Overflow is, essentially, a Q&A web site. Software program improvement is a discipline the place learning-by-doing is crucial; books and formal coursework can solely get you part of the way in which. So the enterprise gives just-in-time assist for challenges that builders are encountering of their work. The questions are often very technical and could be answered solely by skilled builders. It’s not unusual to see subtle snippets of code within the solutions.
To assist guarantee swift and correct responses, Stack Overflow awards repute factors each for asking an excellent query and for offering a helpful reply to at least one posed by one other particular person. Up and down votes from different customers decide the precise repute factors awarded.
A research paper printed within the prestigious journal Administration Science exhibits that builders worth the repute that Stack Overflow affords them. They interact extra enthusiastically in reputation-generating actions whereas they search a brand new job, however cut back their contributions by practically 24% after they discover one (disclosure: one of many authors of this examine is my co-author on a special examine). By specializing in liquidity—guaranteeing that good questions are requested regularly and answered promptly and successfully—the corporate has develop into a vital useful resource to an engaged developer neighborhood with over 100 million folks accessing its web site each month.
Like many multi-sided platforms, Stack Alternate is free to make use of for builders. Its revenues come from promoting by corporations trying to rent builders and to promote merchandise to this neighborhood in a focused manner. With a rising archive of content material and new questions posted repeatedly, the corporate has constructed a potent flywheel, attracting extra builders, which in flip enhances its providing to advertisers, which then generates extra assets to fund enhancements to the platform that appeal to extra customers.
There’s one more profit that may accrue to Prosus, with its current investments in EdTech corporations and as a tech funding firm. It is going to be in a position to seize market insights from the Stack Overflow neighborhood to be taught which applied sciences have gotten extra invaluable and the place expertise improvement could also be essential.
Furthermore, as Stack Overflow grew to become an vital useful resource for builders, some corporations started to ask for the same product to facilitate collaborative efforts solely amongst their in-house builders. This providing, which started considerably informally, has develop into Stack Overflow for Groups. Firms together with software program large Microsoft, digital natives like Instacart and Field, and conventional companies like Chevron and Siemens, use the product. With increasingly more corporations trying to construct in-house software program capabilities, platforms that permit builders to collaborate internally have excessive progress potential.
With US corporations serving as a number one indicator of the rising significance of software program, it’s solely a matter of time earlier than ones in every single place else will embrace platforms that facilitate collaboration amongst builders. The acquisition follows within the custom of Microsoft’s buy of GitHub and LinkedIn, which had beforehand acquired tech studying supplier Lynda. Prosus believes it might probably assist Stack Overflow attain “a wider worldwide neighborhood, whereas additionally additional scaling the corporate’s Groups product to place Stack Overflow on the middle of product and know-how improvement inside main enterprises globally.”
Prosus is making a wise wager on the pattern in the direction of constructing software program as a core competence in corporations worldwide. The deal serves as one more reminder that CIOs and different prime C-suite executives should acknowledge software program as a important asset.