If you listen to its supporters, the low-code/no-code movement has succeeded in the enterprise tech industry. Startups and tech giants are both introducing the effectiveness of a new way of software development that is proving to be faster, more efficient and easier to access than ever before.
Low-code and no-code tools promise to do everything from crisis resolution to developer shortage to empowering the average business user to build applications. To that tune, a wave of startups including Builder.ai and Genesis Global have raised $ 100 million or more to fulfill those promises.
That funding also caught the attention of platform players. SaaS giants from ServiceNow and Salesforce to Microsoft all have their own brand of development features that are low code and no code. Late last year, there were “over 200-and-something low-and-uncode startups, vendors, large companies like us in this market,” said Marcus Torres, vice president of low-code ServiceNow App Engine platform.
It is noteworthy that although the terms are often grouped together, there is a difference between low-code and no-code. While low-code tools require some understanding of programming languages, non-code tools require only basic logic, and generally use a drag-and-drop user interface.
Despite market activity, industry experts and practitioners disagree on where the true value of the industry lies. And even if all the VC money is thrown around, it’s pretty clear that low-code and no-code companies still haven’t had their breakout moment.
Life with little code
The low-code/no-code movement has been circulating for several years, but is rising in popularity as developer shortages and the need to digitize more business processes have accelerated after the pandemic.
“When we started the company in 2013, there was no such thing as low-code/no-code,” said Eran Zinman, co-founder and co-CEO of Monday.com. The concept existed, but Zinman and his team had no phrases to describe it to investors. “I think over the last two to three years, because we’ve seen the rise of such tools, the term low-code/no-code has come about because so many people understand its value.”
In those people, adoption is also lower.
“If I go back five, six, seven years ago, a lot of developers … a lot of them are naysayers,” said Ed Macosky, head of Product at integration platform Boomi. Back then, developers wanted to write all the code themselves, but with ever -increasing workloads, that changed.
While this movement may have started initially with a focus on developers, it has now expanded to providing tools for the average business user as well, says Chris Yin, a principal at Scale Venture Partners.
Now Yin sees low -code and no -code companies as serving one in four markets based on whether the tool is designed for the average business user versus an actual developer, and whether the application is primarily for internal use vs. customer-facing.
The low-code/no-code market can be divided into four segments.Chart: Chris Yin/Scale Venture Partners
But the mixture of hype and the proliferation of vendors can make it difficult to parse the low-code and no-code industry, so vendors, companies and VCs disagree on which of those markets is most important. .
The real deal
For one, there is still debate about whether developers or the average business user are the better target market for development tools with low code and no code.
Most of the companies that talked to Protocol agree that those tools actually make the coding process less time consuming for development teams “because then you can very easily, with limited effort, create new ones. enterprise -capable applications, ”said Claus Jepsen, CTO of enterprise resource planning provider Unit4.
But as a former developer himself, Mackey Craven, a partner at OpenView Venture Partners, disagrees that developers are the best target market for these tools. “For me, it’s a little bit more about taking someone who [doesn’t have] the whole level of special skill set to be a developer itself and gives them more ability to solve their own problems, ”he said.
Those individuals are known in the industry as “citizen developers,” or line-of-business employees who are now able to create their own applications because of the ease of low-code or no-code tools.
But the idea that low-code and no-code tools only have value because they let anyone code is a pretty misnomer. “What we’re really talking about is the kinds of system-thinkers and power users who can understand logic, and in a simple toolset, put it into an application that goes into production,” said Josh Kahn, senior vice president of Creator ServiceNow application experience platform workflows.
Even anyone can build an application, “the problem is: is it done properly? And is there a system-design mindset needed to understand inheritance, object, schemas, integration, design” and so on, says Gary Hoberman, founder and CEO of the Unqork code -free platform.
What the industry can agree on is that these tools will not be used to develop customer-facing applications within businesses.
Even though the tools have become more complex, they still provide the greatest benefit internally. “We’re probably not going to use it internally to provide the enterprise -grade software we sell to customers – it’s not used for that,” Jepsen said of Unit 4.
That’s why among the various companies in the market, Scale’s Yin sees the most promise among those focusing on internal applications, which is where the movement began. “The reason it started that way is it turns out that internal software is just a big part of spending, and the math makes sense there,” Yin said.
The breakout moment
But the question still remains whether standalone low-code and no code vendors or platform players will take over that part of the market.
Some view these tools as a feature beyond a business model, a perspective that favors platform players. “I look at low-code and no-code as a product option, as a way to create value in an end market,” Craven said.
Although companies like Mendix, OutSystems and Retool have encountered some success as standalone development platforms, some practitioners in the industry do not believe that these types of companies will live much longer. “I think the industry is changing now to the point where you can no longer stand alone,” said Matt Calkins, founder and CEO of low-code platform Appian.
Continued consolidation, such as SkyGiraffe’s acquisition of ServiceNow, could be another sign that the market is becoming commoditized. “For me it’s a generic kind of tooling. I think it’s hard to be [standalone]and I think there’s another merger going on, ”Jepsen said.
However, there are advantages to standalone vendors.
While developers can build low-code or no code applications on top of Salesforce or ServiceNow, for example, they will be limited by walled gardens of platforms. “If I’m trying to do something that uses data from different parties, or is more independent, I’m more likely to join a third party,” Craven said.
While there is room for both standalone companies and SaaS giants to play, there is likely to be another wave of aggregation in the future. It seems clear that winning low-code/no-code companies will focus on developing internal software, but it is still an open career among business users or developers as a more profitable target market.
One thing seems certain, however: Low-code and no-code development isn’t going away any time soon, and even with all the hype, the industry is still going through its breakout moment.
“I think within the companies, they’re the lead here and they’re coming out now, but it’s too early,” Yin said. “We’re still waiting for more.”
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