Here’s Why Database Market Investment Remains As Interesting As Ever

Quick! Name a tech category that has almost 400 multiple possibilities, always competing for your recognition. One that generated over $80 billion in revenue in 2022 and is actually increasing its growth rate even after decades into its existence. Additionally, it continues to spawn startups with seemingly limitless venture funding and generated the most job listings of any programming language in 2022.

If you guessed “database,” you would be correct.

Luis/Pexels | Why is this decades-old market currently so hot?

We conversed with Sandesh Patnam, managing partner of Azim Premji Foundation, to find out more about the firm’s investing philosophy and his enthusiasm for the database industry.

What characteristics do you want in investments?

Patnam says the company aspires to invest in businesses that prosper in the open marketplaces. Their public practice belief is in many ways reflected in their public practice portfolio, and this continuity enables them to assess a business model’s resilience, pricing, quarterly rhythm, value creation, and team rigor.

All of these indicators are more easily stated than done, yet they provide a reliable indication of quality. Many businesses can spend a lot of money to obtain a “push-based” approach, but doing so may result in false positives, which is why they desire a significant market “pull.”

Why should you invest in the database market?

Everyone has heard that, with time, tech will revolutionize all aspects of our lives. But more crucially, Patnam asserts that machine learning and artificial intelligence (AI) will completely take over the software segment. Many businesses produce software, most of which are straightforward workflow tools. Data must be the focal point for software to be actionable.

When you consider where AI and ML are taking the world, how will it get more intelligent Another factor to consider is whether data can be stored effectively given the rate and volume at which it is being generated.

Thisisengineering/Pexels | If so, every software should be predictive in some form as AI and ML may improve over time

What is the investment approach of Premji Invest?

Mid- to late-stage growth equity and public stocks are essentially divided equally in Prenji’s direct crossover investment approach. Their long-term length investing strategy is supported and informed by an evergreen structure. Contrary to what many investors believe, they do not consider an IPO as a potential moment of exit and frequently played a significant role in the initial public offerings (IPO) of outstanding members of their private portfolio and kept the relationship continuing even after going public.

Why is the database industry more fascinating than ever right now?

The requirement for current information E-commerce, ad spending, and once-only real-time events must all be regulated. You’ll lag behind if you don’t have access to the proper instrumentation and real-time analytics. Consider the corporations that have seized market share and upended whole sectors; consider what tech rivals like Netflix and Amazon have done to preexisting companies.

Marek/Pexels | They all result from the fact that they were considerably better than others in instrumenting their business

At Amazon, the chief financial officer’s office resembles the chief revenue officer’s office in many aspects. Amazon has the ability to track its sales down to the SKU level. Consider the flavor of toothpaste that is popular in the Northeast. Amazon can inform you of the profit contribution, the purchasing cycle, the potential customer’s identity, and the supply chain’s logistics.

When you start breaking it down at the SKU level, you can promote specific products in certain markets, decide on precise contribution margin decisions, and execute nearly flawless promotions.