Recent funding could strengthen company against hard-charging Autodesk, but reliance on Internet connection hurts.
Onshape, the CAD world’s richest startup, wants to empower the next generation of CAD users, and could do so, if not for its Achilles heel: reliance on an Internet connection. (Image courtesy of Onshape.)
The latest round brings the total raised to $169 million, according to CrunchBase, making Onshape the richest startup CAD since … ever.
No one argues that the investments are made on faith. The company has yet to reveal the number of paid seats or revenue figures. But since Onshape contains the entire founding nucleus of SOLIDWORKS, including the highly respected Jon Hirschtick, the last guy to cause a CAD revolution, they have had no trouble getting investors to turn their pockets inside out.
More investment is always good, right? Now Onshape can execute on bigger plans. Or, is it seeing the end of the runway as it tries to take off?
Where Art Thou, Revenue?
As a private company, Onshape does not have to supply revenue figures or paid license counts. But as acknowledged by Onshape, revenue, whatever there may be of it, will come in smaller chunks. CAD programs sold with perpetual licenses had one big advantage—when a company sold a seat, it was an immediate infusion of thousands of dollars. Every time Onshape gets a user to upgrade to a paid license, it gets only a $100—for that month. And how many are paying, considering you can use the exact same product for free? Onshape’s pricing model, based on GitHub, an open-source development platform, has never been attempted in the CAD world.
Betting the House on the Internet Connection
One can imagine Onshape as a company where employees sit on bales of cash and a line of wealthy investors extends out the door. Or is this latest round of funding time for a gut check for Onshape executives? If sales of Onshape have not reached braggable heights, is it time to examine why not. One reason, Internet connectivity—or the lack of it—be Onshape’s Achilles’ heel?
Quite simply, the main reason Onshape is not already ubiquitous could be that the program doesn’t work without an Internet connection. An Onshape user is simply dead in the water unless they are connected to the Internet.
A “full-cloud” CAD program may have seemed like a good idea initially—and sold well to venture capitalists quick to seize absolute connectivity as the very modernization of CAD, especially when it was suggested by guys who were themselves the heart and soul of CAD. It’s not hard to buy into the concept if you are coming from a broadband world, always on, a Starbucks-sipping, airport-hopping, boardroom-dwelling, iPhone-tapping world of the VC investor. But for the potential user with the project due yesterday, the reality of the connection, around the clock, around the world, can be far different and far from ideal.
Who, among the users, is going to bet the house on the reliability of their ISP?
Here Comes Autodesk
Why bet the house if you don’t have to? What if you could have everything Onshape promises, the use-anywhere, almost robust CAD, when you needed it, for however long and at no risk to your credit card limit—and still be able to work when offline?
All this attention on Onshape has stirred up the giant Autodesk—and the giant is grumpy. Autodesk had cloud-based CAD ahead of Onshape, and its Fusion 360 is functionally the equivalent of Onshape—maybe even more functional—and, as some would say, it’s racing ahead.
It’s time to closely examine the value of the one claim for which Onshape is most famous. Onshape is “full cloud.” There is no install on your computer or your tablet. All of its data storage is online.
CAD did need a facelift, and the cloud was ready to provide it, but having a product that only worked when connected may have been a jump too far.
I’ll Work When I Want
My most loved apps use the cloud but are still functional without it. The rough draft of this article was written in Evernote, before I connected on the airplane WiFi, which I know from experience will work well about 50 percent of the time. I check my landing time on WorldMate while still unconnected. I cross a few items off my to-do list on Wunderlist. When I land or get lucky in flight I know all my data will sync up. I’ll not have missed a beat. Thanks, apps, for letting me work wherever and whenever on whatever.
If Fusion 360 can match or surpass Onshape in ease of use, cost and functionality, which many say it has, its ability to operate with no Internet connection is an unbelievable advantage in the battle of next-generation CAD.
Full Cloud: Good or Bad?
Onshape executives may be sporting “full-cloud” tattoos and holding firm in their belief that full-time reliable connections are here—or will be soon. Is Onshape unconcerned about the ones who aren’t connected or the ones who cannot be? They do seem to believe that even the ones who have a full-time reliable connection most of the time will not be at all concerned about the few times they don’t.
I have to think of all the times I’ve heard CAD users state that they absolutely do not want to save their data locally. Hmm … never happened. Or the times they’ve said they can’t tolerate one more install. Zero.
Onshape hanging onto “full cloud” as a unique set of features, when it really exposes a competitive vulnerability, is like Achilles bragging about his heel.