Topgolf saved over $11.3 million after leaving VMware

The Price of Loyalty

For years, Topgolf was a VMware shop through and through. They weren't just casual users; they were deeply integrated into the ecosystem. But when the licensing math stopped making sense, they didn't just complain—they walked. The result was a staggering $11.3 million in savings. For those of us building in the tech space, this isn't just a win for their accounting department; it is a clear signal that the era of the 'legacy tax' is coming to an end.

When Broadcom acquired VMware, the industry held its breath. We all knew what was coming. Private equity and massive conglomerates don't buy enterprise software giants to keep prices low; they buy them to extract maximum value from a captive audience. Topgolf recognized that their 'loyalty' was being weaponized against their bottom line. They chose to migrate, and the scale of their success should make every CTO currently staring at a bloated renewal notice rethink their entire infrastructure strategy.

The Open Source Pivot

The transition wasn't about finding a cheaper version of the same thing. It was about shifting toward a more flexible, open-source architecture. By moving away from proprietary virtualization, Topgolf reclaimed control over their stack. This is something I talk about constantly: if you don't own your infrastructure, you don't own your business. You are essentially renting your right to operate, and the landlord just doubled the rent.

Builders need to pay attention to the specific tools that enabled this. We are seeing a resurgence in the relevance of KVM and other open-source hypervisors that provide the same utility without the predatory licensing models. Topgolf’s move demonstrates that these tools are finally mature enough for massive, high-traffic enterprise environments. The 'no one ever got fired for buying IBM' mentality is dead. Now, you might actually get fired for failing to find an alternative to it.

Founder Perspective: The Hidden Costs of Convenience

As a founder, I understand the allure of the 'all-in-one' enterprise suite. It’s convenient. It’s supported. It’s safe. But convenience has a high price tag that usually shows up three to five years down the line when you’re too integrated to easily leave. Topgolf’s $11.3 million windfall represents money that can now be funneled into actual innovation—better guest experiences, faster tech at the hitting bays, and improved data analytics.

Instead of paying for the right to run their servers, they are investing in the business itself. That is a massive competitive advantage. If you are a startup founder today, you should be building with the 'exit from day one' mentality—not exiting your company, but being able to exit your vendors. If your entire product relies on a single proprietary API or a specific cloud provider’s unique features, you are building on sand.

The Migration Reality Check

I’m not going to sit here and tell you that moving away from a giant like VMware is easy. It’s painful. It requires a high-level engineering team that understands the underlying plumbing of virtualization. Topgolf likely spent a significant amount of time and man-hours on this migration. But the ROI speaks for itself. An $11 million saving is not a rounding error; it’s a transformative amount of capital.

For teams looking to follow suit, the takeaway is clear: start documenting your dependencies now. Understand exactly what features you are using that are proprietary versus what can be commoditized. The more you can treat your infrastructure as a commodity, the more power you have in negotiations. Topgolf had the leverage because they were willing to do the work to leave. Most companies stay because they are afraid of the migration work, effectively paying a multi-million dollar 'laziness tax'.

What This Means for the Future

We are entering a cycle of decentralization, not just in finance or AI, but in core enterprise IT. The trend is moving toward 'sovereign infrastructure.' Whether it's running your own LLMs locally to avoid API costs or moving to open-source virtualization to avoid Broadcom-style price hikes, the theme is the same: reclaiming the stack.

I expect to see a wave of companies following Topgolf’s lead. When a brand that mainstream and that large makes a move this successful, it gives cover to smaller players to do the same. The narrative that you 'need' enterprise-grade proprietary software to be stable is being dismantled in real-time. Stability now comes from diversity and flexibility, not from a single vendor's support contract.

The Bottom Line

Topgolf’s migration is a case study in tactical bravery. They saw a cost-to-value ratio that was broken and they fixed it by looking outside the traditional vendor box. For the builders out there, the message is simple: don't get comfortable. The tools you use today should be chosen based on their utility and their portability, not their brand name. If you can save $11 million by switching to open source, you’d be a fool not to. The era of the captive customer is over, provided you’re willing to put in the work to escape.

Read the original at Ars Technica →