Salesforce.com: The First $1 Billion SaaS Company?
Salesforce.com announced strong quarterly financial results today, and the company expects revenue for its full year (ending in January 2009) to exceed $1 billion. Does that mean Salesforce.com will become the first $1 billion software as a service (SaaS) company?
Admittedly, I’m not sure. There are some highly vertical SaaS software and monitoring companies that may generate more than $1 billion in SaaS revenue. And some folks may argue that Google (annual revenues: $16.5 billion) is a SaaS company.
But Salesforce.com is the poster child for SaaS, and breaking the $1 billion mark will be a watershed event.
If you’re a small managed service provider testing the SaaS waters, keep an eye on Salesforce.com’s potential transition from CRM software provider to an online application development platform.
Joe,
Salesforce (and NetSuite) for SaaS represent what’s missing in the MSP space – a gorilla. While these two companies, that are not even 10 years old, have reached “rock-star” status in the technology industry re-writing the software playbook and the multi-billion dollar companies around them, managed services is still looking for it’s market-defining moment.
Maybe it’s because managed services is so fragmented with 99% of the MSPs being very small, generating under $1M in revenue.
Maybe it’s lack of funding and recognition by the investment community.
Managed services is really “owned by the people” of the channel, and therefore may never have that defining moment like SaaS or even Virtualization.
The question is, “Who can aggregate the market and become the first “pure-play” billion-dollar MSP for the SMB market?” It is possible, but only if the managed services industry starts thinking a lot bigger then the current “do-it-yourself” model.
Becoming an MSP should have an end goal – to build a business you can one day monetize for maximum value (a lot more than 1x revenue). That’s what the SaaS pioneers executed on within a very short timeframe…thx