The Marketplace Evolution: Why AI Distribution is the Next Big Frontier

Hey everyone. Welcome back here to Text Drunk tv. It's great to have you, uh, my ne it's great to have my next guest too.

Let me introduce you to him. It's his first time here. His name is Andy Sten.

He's the CTO of a company called App Direct. And Andy, it's great to have you on Tech Drunk tv. How are you?

I'm doing great. And uh, thank you Alan, for having me on this, uh, program. I'm really looking forward to our conversation.

I'm so am I. So am I. Um, Andy, I, I know you're in Austin today, and, and as I said, you're the CTO of app Direct.

You and I are both kinda freezing in the fifties where many of our friends and relatives are dealing with two feet of snow. So I guess, you know, it's all relative. Exactly.

But beyond that, tell us a little more about you. Uh, happy to. So, um, I'm currently the CTO of AppDirect and, uh, I like to tell people I've been doing the same thing throughout my career and my career goes back a long way.

Started in the, in the nineties, and I was lucky enough to join at a time when people were just beginning to do commerce on the internet. They were just beginning to get comfortable with putting their credit cards out there and buying and eventually selling things. So I got into the IBM's e-business group where we implemented some of the first e-commerce, uh, implementations.

And my career has kind of continued from there. I worked at IBM, I worked at, uh, Walmart Global when they went going, uh, online, worked at Salesforce when we launched the first app exchange. And about 15 years ago, uh, I got in touch with some, uh, with some people who had founded this new company called AppDirect.

And the, the whole reason for AppDirect is we wanted to create a marketplace, a destination for small, medium business owners to come and buy any kind of subscription product that they want, whether it's software, whether it's hardware, whether it's energy for their shops and factories, is to be that one stop shop for all their business needs. And we've been building that, uh, that vision ever since. Uh, we have thousands of advisors right now in the US who use our marketplace to provision all these services, uh, for small businesses.

Our technology is used by small companies. It's used by large companies like an at and t or Comcast or Deutch Telecom to power their own subscription experiences. So it's all about commerce on the internet and how we've gone from web and the mobile.

And now we're all obviously talking about AI and how does the, the, the rise of AI change the way we buy and sell the services we all need. Yep. I love it.

I love it. So, diving forward, you said AppDirect's been around about 15 years. Mm-hmm.

That's right. You know, I, one of the things I like, I'm, I'm, look, I'm conscious of marketplaces 'cause I've been using them a long time and I've, I've actually had the pleasure of interviewing and interacting with companies who developed marketplaces. I mean, it's a huge, and, and what start, I remember when I, you know, I first became sort of engaged with marketplaces and I thought, what a great idea.

Right? What a great idea in a past life, some of the startups I involved in, I was the channel. Uh, I ran the channel sales team, channel marketing channel sales, and I said to myself, what a great idea to empower your channel, right?

If you have a brand, and they could kind of ride that or be part of someone else's channel, right? If they have the marketplace, what a great idea for me to be able to sell products into that channel. Absolutely.

And you know, I, I saw it in so many different, uh, iterations, right? AWS probably is the one I think people think of most when they think of marketplaces. net or I mean's, I would venture that there's a lot of marketplaces that our audience is interacting with on a regular basis.

And really you're not recognizing that what it is is just just another marketplace, right? Right. 'cause we've done such a good job of making them organically, part of the experience, the user experience, um, and, and, you know, kudos to companies like AppDirect and who, who have pioneered that, right?

And have really made it, uh, I was reminded, I was out in reinvent in December, you know, and you had all these comp, not all, but a select few companies that had gotten these awards for a billion dollars in sales through the AWS marketplace. Think of it, that selling a billion dollars in goods and services through the marketplace if you're a single marketplace. Mm-hmm.

That, that's really, uh, an accomplishment. Now, of course, AI is like it is and everything else, it's disrupting, but in a good way, maybe. Right?

Right. Um, talk to us about how AI is disrupting, changing, evolving marketplaces right before our eyes. Absolutely.

Uh, before I jump in, since you brought up Reinvent, I was at, uh, reinvent as well. And it's, it's absolutely heartening to see those successes, people selling a billion dollars or hundreds of millions of dollars on a single marketplace. Uh, one of the things that AppDirect does is we help software companies get onto other marketplaces like AWS Uh, there are hundreds of some of the most successful marketplace strategy companies who are on AWS and selling millions who are actually onboarded on their and manage their AWS experience via AppDirect.

So just wanted to throw, throw that out there as something that we do. But in terms of ai, yeah, we are seeing that as well, uh, both internally for inside our own company as well as, you know, software, the platform that we build, we are using AI more and more to develop software. We are seeing this new phenomena where non-technical people are creating their own AI tools.

Um, we are seeing phenomena that, you know, point solutions that we used to go out and have to buy for. We can now substitute by something that's built over a weekend, for example. But what's I think where, how this ties in with Marketplace is, yeah, it's the cost to create software has gone down, but there is no AI for distribution.

Once you have got some kind of a compelling software, you still need to market it. You still need to put it out there where your users can, can find it, where the users can actually buy it. And on the flip side, as a user of software, it's great.

I can pick up a magazine or, or read a, or hear a podcast about all those great AI enabled software, but how do I get my hands on it? How do I see unbiased reviews? Where do I actually go to get good advice on what these new tools are?

And so I think a marketplace fits this new paradigm perfectly as we're getting an explosion of new AI enabled products. A marketplace is the right environment or construct, or whatever you wanna call it, uh, to actually discover these new products and be able to figure out like, which one of these new products is what you need to, uh, use. And so, you know, at app, correct?

I mean, we, we are absolutely loving this, uh, uh, this AI boom. Sure. I I would imagine I it, there, there's another angle to it too, is I think the ai, um, vendors are going to need marketplaces.

Absolutely. So, right? So we're gonna have more marketplaces than ever some market, some will go to marketplaces to get AI products or AI solutions and services.

So, you know, why should that be any different than any other Market? It, it's not. And, um, so again, just to talk about some of the things that we're doing.

I'm not saying that we're unique along with AppDirect marketplace. com, we have actually set up a separate marketplace or a digital, or a AI playground called Devs ai. And anyone can go there, whether you're a user, whether you're a company, and that's actually a marketplace or a, or a environment where you can use any of the large language models.

You can use like the open ai, philanthropic Google, and use those as your base to build AI powered software to build AI powered agents, AI powered companions. And then once you're there and you're built something, you can use it for your own purposes, obviously, but you can also push those completed products to the app direct marketplace where you have the distribution to distribute that all over the world. If you've, if you think you've built something, which can be used by everyone, I love it.

What a great idea. Let me, uh, rip something out of the hot headlines and throw it at you. Absolutely.

You know, we're all, we were all a couple weeks ago, but well now they call it Open Claw M Pod Open Claw. It's open claw, right? It's made agentic reel in some ways, right?

For it, it, to me, this is like when Netscape first became the browser, right? Mm-hmm. All of a sudden you went from like tech space browsers to, to graphical browsers and, and you know, it's real.

How does a future where I give my agent this task to go, uh, go build this, assemble that, what have you, and so the agent becomes the user of your marketplace, right? So you're no longer gonna be serving humans, at least not directly. I'm reminded of that sci-fi movie, remember how to serve humans.

They were talking about cooking them. Yes. But, um, but you know, the human is no longer your direct customer.

The agent is Andy, have you thought about that future and, and what do you do? Yeah. Uh, a couple of things.

Uh, one is you, you first, first of all, you have to make it clear that you're, or make it easy for your agent to actually use a marketplace. So there's, from a very technical point, there's like protocols like MCP, which you can enable your marketplace, which makes it easy for agents to come and do all whatever they want to be able to search, they want to be able to, uh, buy. And we have enabled that.

But there's a bigger issue, which you talked about is like, how do you market to agents? How do you have an agent understand that if they're looking for a new CRM tool that they should go to App Direct, for example, or that once they're in app direct, how can they actually search? And I don't think we have the answer for that.

Uh, there's definitely the equivalent of SEO for agents. That's this new field that's coming up that we're, uh, definitely looking into. Uh, there's also this idea of skills.

I mean, you mentioned open Flaw. There's now marketplaces for open flaw skills where people put in their own personalized skills that you can put that on your, uh, companions. And part of it that we're looking at is to create these compelling skills to have a skill as a buyer.

So you've created a skill so that your open claw agent is, knows how to buy, knows how to compare, isn't fooled by, you know, uh, sites or things, trying to give it wrong information, but can actually objectively buy software on your behalf. Because buying software or buying something on your behalf is, is a skill just like anything else. So they have to know your preferences, they have to know what's out there.

They have to know what the common pitfalls are, and we can build, uh, you know, skills and claw, uh, to, to enable this. So yeah. Ex exciting stuff.

Absolutely. It, it really is. You know, I, I imagine if I, if we were here a year from now, what a difference a year is gonna make in, in terms of that issue right there.

Oh, absolutely. I mean, it's, it's the end of February right now, and I think at the end of December, none of this was being talked about, or, or some of it hadn't been. The things like OpenFlow wasn't even invented yet.

The last two months has just seen this explosion in the rate of progress around ai and specifically agentic ai, as you mentioned. So I Can't, but even in The, it's hard to imagine what's gonna happen in a year. No, I mean, I, um, even my friends who were coders, you know, developers, they also say sometime around November, December mm-hmm.

With the latest release back then of Claude and of That's right. AI, codex Codex, the light bulb, you know, the, the, it switched, right? We, it went from being a toy, a curiosity to really working Absolutely not that it's perfect.

No one's saying it's perfect. Mm-hmm. But it, you know, it it just, it it turned the corner and now it's helping build itself.

Exactly. And so the, it's snowballing for all my friends out there in Blizzards, it's snowballing, right? And, and getting faster and better, faster.

Um, and, and so like I say, yeah, in a year it's gonna be a very different, different thing. Um, one of the nice things about App Direct Andy though is that you're all things marketplaces, right? You have customers who are on third party marketplaces and you help them do better, as you mentioned in the AWS model, right?

You help them be more successful on, on independent third party marketplace. You have app direct marketplaces that, let's say serve as the backend for other people's marketplaces. Absolutely.

Yes. You know, white branded or, or what have you mm-hmm. Whiteboard branded, um, you, you are helping define new market marketplaces such as AI and, and stuff like this.

Um, it, it's really AppDirect is kinda all things marketplaces. Yeah, absolutely. I mean, uh, we look at it as, um, even broader in some senses as subscription, uh, commerce.

Uh, but yes, I mean, you know, we have our own marketplace. We supply the technology to enable other people to build marketplaces, and we help customers get onto third party marketplaces. So yes, all things marketplace.

I love it. You know, did we mention the website in all our talking BU rl it's App? com or our main, uh, commerce website.

A p mm-hmm. com. Okay.

And for anything to do with artificial intelligence and agents and Zoom, maybe Open Claw as well. ai, DEV with an S or no, DEVS with an S, Devs, like plural, devs, devs ai. That's right.

Love it. I love it. Andy, you know, was sitting here contemplating a year from now, I can't even imagine, but what else?

When you look out over that year horizon, beyond the Gentech ai, what else do you think are going to be the big stories in marketplaces? Well, I mean, you met, you mentioned, uh, it, it, it already, uh, marketplaces for AI agents seems to be the obvious, uh, thing that's, uh, that's gonna come up. Marketplaces optimized to have a good experience for agents.

I definitely, uh, definitely, uh, see that coming. But the other thing I see coming is just a much better way to market and distribute all the different products that people are making. As you said, like around November, December, a light bulb went up.

It's never been easier to create compelling services and software. How do you get those services and software on the hands of people? Now, is anything that you have built over the weekend?

Is it, are you ready to push it out, let's say, to the AWS marketplace? Maybe, maybe not. I mean, that's a much hard, a higher hurdle, but you've created something useful.

So what's your channel for getting something useful out there? So it could be made, so it could be used by people. You can get that feedback and eventually you do become a billion dollar sale on, on an AWS marketplace.

But what's that path of going from something you wide coded over the weekend to billion dollar sales? I think that's gonna be accelerated by ai. And a lot of the products and roadmaps that we are doing at AppDirect is trying to build that pathway.

Andy, I want to thank you for coming on Techstrong TV today. It was a great conversation. Keep up the great work at AppDirect.

You know, I i the mark of, I think success is when people don't even realize they're using your product when, and they use it and they're happy. So if you, if there are people out there who say, I didn't even realize it after Direct had these marketplaces and I've been buying stuff from it, you did your job. You did it.

Well keep it up. Come back and visit us again soon. We'll be in touch.

Thank you, Ellen. And, uh, really appreciate the chance, uh, you to come over here and talk to you and discuss all that's happening in the industry. Excellent.

Andy Sense, CTO of AppDirect with us here on Tech Drunk tv, we're gonna take a break. We'll be back with more in just a little bit.