The SaaS industry is on fire as valuations grow, delivery costs shrink and everyone—from securities traders to online shoppers—expects the kind of seamless experiences that only SaaS can deliver. Rob Sverbilov, Director at Golub Capital, sat down with Matt Parson, CFO of CloudBees, who has his finger on the pulse of the SaaS industry, to talk trends and growth.
CloudBees provides the assembly line for developers to deliver SaaS solutions and other software applications. By giving developers a suite of cloud native tools, CloudBees is building the first end-to-end software delivery system that helps firms balance risk management with developer creativity and freedom.
We’re filling a market need in every industry. More and more every business is a software business, and must continue developing software for both internal and external customers in order to stay competitive. We give firms a way to do that, while accounting for cybersecurity risks and enabling companies to balance governance and developer freedom.
The biggest challenge I see is helping companies transition from on-premise development solutions to cloud-based solutions. That adoption can be tough. A lot of companies are in various stages of updating their software systems; some are still using on-premise servers, which are costly to maintain and pose risks to security, others are completely cloud native but most are somewhere in between.
It’s the greatest challenge, but also the greatest opportunity, as cloud native SaaS platforms can supercharge a business’s growth and take it to the next level once implemented. SaaS companies that begin to act not only as a vendor but as a strategic partner to firms will be the ones that win in the future. Software is not just a quick fix—it is how innovation and an excellent customer experience is currently delivered, and will continue to be delivered in the future. SaaS companies that can align themselves with the mission and goals of their clients and consult on how best to evolve their software development lifecycle to embrace SaaS will do well.
Research and development is number one! The product drives everything at the end of the day. The SaaS space is crowded and companies have to fight to innovate and differentiate themselves. Investing in continuous innovation ensures that companies can keep up and adjust to the demands of customers and the market. For a company like CloudBees, it also ensures that we are leading in the space and setting the agenda for our competition.
First, it is critical to think through what your company is trying to achieve. Even more than, “Will I get the money I need?” it’s more important to ask yourself, “Am I working with the right strategic growth partner to achieve the successful outcome we are working towards?” In many ways, an alignment on values, missions and goals is more important than the funding itself.
Secondly, not enough CFOs talk about the importance of keeping your data in order. Oftentimes at startups, CFOs are one-person teams. When it’s time to take on an injection of cash, there is a lot of due diligence and it’s essential to make sure that you have all your financial documentation in order.
Absolutely. Buying can certainly beat out building if you consider the time and expense you save including the trial and error process. Things are moving quickly and acquisitions can help you leapfrog the competition. The industry is crowded and consolidation is not only inevitable but resourceful. Strategic acquisitions have, in part, enabled CloudBees to quickly build the world’s first end-to-end software delivery system, and we encourage the SaaS companies we work with to think about following that model.