Last week, Benchmark announced a $3.5 million investment in Engine Yard, which provides commercial support for Ruby on Rails applications. Engine Yard is doing $3 million in business and growing. It's also profitable. It didn't need the investment.
The investment, however, is very telling. When one of the top venture capital firms on the planet puts hard dollars behind a support model, it's significant. It becomes doubly so when the firm (or its investors) in question previously invested in JBoss, MySQL, SpringSource (Interface21), and other support-based open-source companies.
It may mean that Benchmark knows something that the rest of the industry seems determined to ignore: services-based businesses may well be the future of the software industry.… Read more