Stackshare is a community-driven web site with a strong technology angle. It allows engineering teams within companies to post information about the software components and business tools that they use internally to power their software applications and run their online operations. The content is self-reported by members of the company’s technology organization. The purpose is to share knowledge across companies and socialize best practices. Analysis of the content posted on Stackshare provides insights into real-world use of these software components at large enterprises. This intelligence could influence our investing decisions into the stock of software stack provider companies.

On the Stackshare web site, they define of a tech stack:

A tech stack is defined as the set of technologies an organization uses to build a web or mobile application. It is a combination of programming languages, frameworks, libraries, patterns, servers, UI/UX solutions, software, and tools used by its developers.

STackShare Web site

Components of the tech stack are organized into logical groupings. These software components and business services are collectively referred to as “Tools”. I provide some examples that fall under each logical grouping:

  • Application and Data – Languages (Java, Python), databases (MySQL, MongoDB, Redis), application servers (Nginx)
  • Utilities – Infrastructure (DNS, CDN)
  • DevOps – Package managers (Docker, Kubernetes), application monitoring (New Relic, DataDog), logging (Splunk)
  • Business Tools – Communications (Slack), customer service (Zendesk, Salesforce), project management (Jira, Asana), collaboration (G Suite, Office 365)

The groupings aren’t perfectly aligned, but the tools are fairly distinct and recognizable. The first key observation is that some of the “tools” listed represent software or services provided by publicly listed companies. This is interesting from an investing perspective.

The meat of the Stackshare site represents a listing of companies and the self-reported tools that they use. In the Browse Stacks section, we can see a listing of “the open source tools and SaaS behind popular tech companies.” Results can be filtered by Trending or Top companies. A view of the top companies, places recognizable brands at the beginning. While it’s not clear what the sort scoring algorithm is, company size or prominence seems to factor in. For example, the first three companies listed are Pinterest, Uber and Airbnb.

A quick examination of the tech stacks at these 3 companies provides some top-level insights.

  • Slack (WORK) is used by Airbnb and Pinterest
  • Zendesk (ZEN) is used by Pinterest and Uber
  • Twilio (TWLO) is used by Uber and Airbnb

Further down the companies list, I see many other recognizable players like Facebook, Spotify, Dropbox, Stitch Fix and Shopify. The vast majority of the companies listed are “internet first”, versus the more traditional companies in the Fortune 500. Nonetheless, we can expect that these “internet first” companies will 1) be larger users of these tools, 2) continue to grow more quickly as they disinter-mediate the incumbent businesses and 3) the more traditional companies will eventually become more software-driven. Also, as developers from internet first companies get lured to roles at traditional enterprises, they will bring preferences for advanced software stack components with them.

Additionally, I wouldn’t conclude that a tool isn’t used by a company if it isn’t listed. This has to do with the mechanism by which Stackshare has the user enter their company’s tools. It isn’t exhaustive, so some tools could be overlooked. However, a selection of a tool is deliberate, so we can draw conclusions from an actual listing.

The site also allows the user to see a list of all tools. The default view is based on tools that are trending (assume this is based on change in positive interest). One can also sort by the “top” tools, which orders the tools by some measure of overall popularity. This is insightful, as we can see how popular tools provided by publicly traded companies rank relative to alternatives. For example, Slack (WORK) is high on the list with 27,800 stacks claiming to use it. While MySQL is currently the top database, MongoDB (MDB) is a close second. Trello is surprisingly broadly used – this tool is part of the Atlassian (TEAM) product offering.

Finally, the Stackshare site does allow commentary around tool choices. These are comments provided by the members of the engineering teams providing stack shares from the different companies. These comments are associated with the company’s stack or individual tools. Browsing through these comments can provide some additional, pointed insights, but obviously require more effort to review.

As part of my analysis of software stack companies for investment decisions, I will review Stackshare periodically. This provides a means to keep up with trends and insights into the increasing or decreasing popularity of tools within progressive software-driven companies. These insights will help influence recommendations for software stack company investments. It is my strong belief that these usage trends and insights from actual software engineering organizations will more accurately predict stock performance over the long term than snapshots of financial performance or broad industry commentary.