180 Million Global SaaS Customers and Growing
• The SaaS software delivery model caught on quickly and has continued to grow year-over-year to nearly $400 billion in 2021.
• By 2026, Gartner predicts that public cloud spending will exceed 45% of all enterprise IT spending (up from less than 17% in 2021).
• In the US, about 15,000 companies host applications and make those solutions available via the Internet.
• The Software-as-a-Service (SaaS) sector serves nearly 180 million customers around the globe.
SaaS Catches on Fast
• By 2020, organizations worldwide were using an average of 80 SaaS applications each.
• SaaS applications now account for 70% of these companies’ total software usage.
• According to Gartner, end-user spending on public cloud services will grow by 21.7% to reach $482 billion by 2022.
• By 2025, just 15% of all organizational software is expected to be non-SaaS-based.
• In high-growth mode, software companies are expanding organically, being targeted by private equity (PE) firms, and exploring initial public offerings (IPOs) and mergers and acquisitions (M&As).
• Multiple SaaS firms were able to IPO in 2021 as a result of increased business. Compared to the same period in 2020, the number of enterprises specializing in SaaS that have IPOed surged by 125% in 2021.
• Software companies are also dealing with increasing competition, pricing pressures and other business challenges.
• These issues have pushed SaaS companies’ financial reporting requirements well beyond the capabilities of their homegrown and basic software systems.
Consolidating and Replacing Disparate Systems
• SaaS companies tend to rely on antiquated, on-premises software and basic financial systems to run their business.
• Yantra helps minimize the challenges of replacing existing technology and gives SaaS companies the best of both worlds: a leading cloud ERP system that’s connected directly to the existing software platforms that these firms don’t want to give up.
• With NetSuite, SaaS companies can automate management of recurring revenue streams, contract renewals, subscriptions and their upsell and cross-sell activities.
• The system also automatically recognizes revenue based on predefined schedules or milestones in compliance with ASC 606, IFRS 15 and other standards.