This year, there has been an increasing focus on one particular segment - SaaS, which stands for Software as a Service, one of the three major categories of cloud services. [The other two being IaaS - infrastructure as a service and PaaS – Platform as a service]
Some of the SaaS products and companies that we would have come across are Microsoft Office 365, Google Apps (Good Docs is a well-known example of SaaS product which is directly accessed from any of your browsers, computers, or mobile devices), Amazon Web Services (IaaS + SaaS), and the relatively newer ones like Zoom, Slack, Box, DropBox, and Zendesk.
A SaaS company (like Salesforce), hosts all its applications on the cloud and the users (customers) can access those applications on-demand with a subscription/license fee. This business model is a lucrative space for SaaS companies/founders because once you have a great product that can be easily used by the customers, the recurring revenue generated (m-o-m) provides stability to these companies.
For SaaS Start-ups, 2020 is an exciting year because of the impact of Covid-19, where digital transformation was accelerated across all spheres. The VC community is carefully scanning the winners in these hyper-competitive markets. Sequoia, which is the world’s most successful unicorn investor is followed by Tencent, IDG, Softbank, Tiger, and Accel. Globally, after E-commerce, AI and Fin-tech sectors, SaaS as a sector have the maximum number of Unicorns.
After the USA and China, UK and India (26) have the maximum number of unicorns. Bangalore, hosts the maximum number of unicorn companies within India. As per NASSCOM forecasts, the pure-play India SaaS industry has the potential to grow 6X to $13-15 Billion by 2025. The entire Indian SaaS ecosystem (Industry, Government, Academia, Accelerators, Associations, and Think-tanks) has a key role to play for India to realize this potential. Indian SaaS revenues were at $3.5 Billion in FY 2020, growing at 30% y-o-y. 6 unicorn SaaS start-ups (Zoho, Freshworks, Icertis, Druva, Highradius, and Postman) are leading the way with 10+ more projected SaaS start-ups to enter into the unicorn club in the next 2 years.
To learn valuable insights from start-up founders & Venture capitalists and to network with the SaaS Industry veterans, please feel free to join our SaaStock Bangalore virtual event this weekend at: