In our recent posts we expanded on the 5 Offering Maturity Levels from Product Market Fit (PMF) through Strategic Alliance. Today we look at AWS as an example of how a Disruptor mastered these 5 levels and built a $14B business from scratch in just 10 years.
2006: PMF for B2C, Startups
AWS launched its first service (S3) in March 2006. It had PMF for developers of web-based applications who could handle APIs in a self-service fashion. By the end of that year S3 already stored 2.9B customer objects.
Besides PMF AWS also had Go-to-Market Fit (GMF) for this type of customers, mainly individual developers and startups as a (then) small B2B niche, but lacked PMF for larger and more mature B2B customers.
2008: GMF for SMB
In this year AWS launched Amazon Elastic Block Store (EBS) where customers could manage their data in classic structured data formats enabling the first migrations of existing business applications from on-prem to the cloud. By the end of the year S3 handled 40B objects.
2010: GMF for Enterprise Customers
Enterprise customers demand procurement contracts to reflect their internal compliance and governance requirements. Therefor they couldn’t accept AWS’ standard Customer Agreement coming with registering an AWS account. For these enterprise customers AWS established so-called Enterprise Agreements overruling the standard Customer Agreement with individually defined clauses.
2012: Ecosystem Fit
In this year AWS launched their partner program AWS Partner Network. Within ten years the network grew from a few hundred to more than 100,000 partners in more than 150 countries across 7 partner programs with dozens of competencies.
2015: Solution Packages
In 2015, AWS launched templates packaged with marketplace listings and a service catalog for sharing these solutions in a well-governed way across the customer’s organization. As of 2024 the AWS Marketplace is said to provide more than 13,000 solutions pre-packaged for automated deployment in customer AWS accounts.
2016: Strategic Alliance
In this year AWS announced their Strategic Alliance with Capital One as the first full-service bank where Capital One intended to go all-in on AWS and shut down all their data centers (which they achieved by 2020). The agreement was followed in 2019 by Volkswagen Group’s Digital Production Platform as a joint co-innovation alliance which triggered similar engagements with Stellantis and BMW later on, just to name some examples from the Automotive industry.
None of these Strategic Alliances could have been closed without the prior steps all the way back to 2006. And without these Strategic Alliances AWS had not grown into a $100B business and maintained their market leadership in cloud services against competitors with deep pockets and decades of history in the enterprise IT space.
Maturity Level Learnings
AWS’ success proves that an aggressive growth strategy combined with Working Backwards from the customer allows a Disruptor to displace large and powerful Incumbents in a very short time and functions as a lighthouse for any organization marketing disruptive innovations.
Storming through the 5 levels in the shortest possible time requires strong leadership constantly pushing the envelope of both the offering as well as the organizational capabilities, always anticipating the requirements of the next stage ahead of time.
While it looks easy from the outside it is in fact a crazy race putting a lot of pressure on every member of the organization with a significant rate of failure, resembling more of a rollercoaster ride than a smooth cruise.
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