The 3-Tiered Architecture and What it Means to VCs

I have been asked by multiple VC clients of mine to explain the 3-Tier architecture as it pertains to vetting a software company. Since many SaaS, ASP & web-enabled software companies use an interation of this architecture it helps to have a breakdown of it.
Understanding the workings of the standard 3-Tier web architecture greatly improves the VCs understanding of a web-enabled software's inner workings thus allowing for a better investment decision.
The following describes the each of the layers and a standard diagram is provided to represent each conceptual tier:
  • Presentation tier – web application layer consisting of web site code hosted on a Internet facing server (Apache or IIS). Interactions with this layer initiate data transaction calls to communicate with a runtime engine or similar in the COM layer.
  • Logic tier – Often called the COM layer, it consists of a runtime engine or other processing central code. This layer accepts transaction calls from the presentation layer and calls the information from the database, processes them and completes the transaction with the web application in the presentation layers.
  • Data tier – the database is where all client information resides which accepts the transactions requests. The  database looks up the necessary information to fulfill the query then passes it back to the logic tier for process and delivery.
How a company implements its architecture greatly defines how efficient its software delivery is and, therefore, how successful it will be as a business. Additionally, making sure they have chosen all the right parts will provide insight on how coherent and stable their technological competitive advantage is which ultimately decides whether or not they are a good addition to a VCs portfolio.


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