Software's Billion-Dollar Question
Will Salesforce.com be the last "new" software company to hit $1 billion in revenue? Industry leaders share their opinions.
By M.R. Rangaswami, SandHill.com
Mar. 10, 2009
In declaring the "End of Software," Marc Benioff grew Salesforce.com into a billion-dollar software company in just ten years. The SaaS leader now joins the ranks of an elite group of megavendors who dominate the industry landscape.
The milestone prompted SandHill.com to ask the billion-dollar question: Will there ever be another billion-dollar software company? The opinions of industry experts lead to an emphatic answer: "Yes." Here's why.
Global Markets Will Expand & Evolve
- Bryan Stolle, General Partner, Mohr Davidow Ventures
Unless human activity on the planet comes to an end, yes, there will be more billion-dollar software companies.
The world economy (current environment, aside) continues to grow over the long run. We've recently added nearly 3 billion humans to the economic stage, as India and China join the WTO. Combine this with higher education reaching more people than ever, and it's hard to posit a long-term scenario that doesn't result in a larger global economy.
The world grows and changes in ways we often could never predict or envision. Today, we take the Internet as a core part of our lives for granted. People under thirty-years old conduct their social interactions in a large part on-or-through the computer and the Internet - yet the technology isn't even a decade old.
If you had predicted the demise of the multi-billion-dollar newspaper business even ten years ago, people would have thought you were insane, especially outside of Silicon Valley. Most people under 50 now get most of their news from the Internet, and probably haven't looked at a classified ad in a newspaper in close to 10 years.
With a larger global economy comes larger companies - some old, some new. There will be more billion-dollar software companies. How we conduct business, who we conduct business with, and where we conduct business has changed radically in the last decade. In fact, the global financial crisis is the best proof of how interconnected we have all become.
The existing billion-dollar software companies are ill-suited to support much of how we now do business. We often talk about Oracle and SAP as owning the back-office and now the front-office - yet eBay is both for tens of thousands of meaningful businesses.
Some of the giants will adapt and survive. But new giants will also emerge, just as the names of many of the original ERP giants live on only as memories for those of us who have been around a while.
Given the evidence, the proposition that no other software company will ever make it to $1 billion in revenue strikes me as one of the classic technology overstatements like Bob Metcalfe's prediction that the Internet would collapse in 1996.
The milestone prompted SandHill.com to ask the billion-dollar question: Will there ever be another billion-dollar software company? The opinions of industry experts lead to an emphatic answer: "Yes." Here's why.
Global Markets Will Expand & Evolve
- Bryan Stolle, General Partner, Mohr Davidow Ventures
Unless human activity on the planet comes to an end, yes, there will be more billion-dollar software companies.
The world economy (current environment, aside) continues to grow over the long run. We've recently added nearly 3 billion humans to the economic stage, as India and China join the WTO. Combine this with higher education reaching more people than ever, and it's hard to posit a long-term scenario that doesn't result in a larger global economy.
The world grows and changes in ways we often could never predict or envision. Today, we take the Internet as a core part of our lives for granted. People under thirty-years old conduct their social interactions in a large part on-or-through the computer and the Internet - yet the technology isn't even a decade old.
If you had predicted the demise of the multi-billion-dollar newspaper business even ten years ago, people would have thought you were insane, especially outside of Silicon Valley. Most people under 50 now get most of their news from the Internet, and probably haven't looked at a classified ad in a newspaper in close to 10 years.
With a larger global economy comes larger companies - some old, some new. There will be more billion-dollar software companies. How we conduct business, who we conduct business with, and where we conduct business has changed radically in the last decade. In fact, the global financial crisis is the best proof of how interconnected we have all become.
The existing billion-dollar software companies are ill-suited to support much of how we now do business. We often talk about Oracle and SAP as owning the back-office and now the front-office - yet eBay is both for tens of thousands of meaningful businesses.
Some of the giants will adapt and survive. But new giants will also emerge, just as the names of many of the original ERP giants live on only as memories for those of us who have been around a while.
Given the evidence, the proposition that no other software company will ever make it to $1 billion in revenue strikes me as one of the classic technology overstatements like Bob Metcalfe's prediction that the Internet would collapse in 1996.
