Enterprise software spending globally was $529B in 2020, per Gartner.
In 2023, it will be $750B.
That’s a tailwind almost all of us are drafting on.
— Jason ✨BeKind✨ Lemkin #ДобісаПутіна (@jasonlk) April 13, 2022
So these are rocky times in the public markets for SaaS.
And yet … and yet … so many SaaS companies continue to grow faster than ever. And so far, with no slowdown.
The latest Gartner data backs that up:
The big takeways:
- Gartner is predicting acceleration of business software spend in 2023, up to 11.8% growth from 9.8% in 2022. That’s just jaw-dropping acceleration in enterprise spend for SaaS and business software.
- These 2023 estimates have been boosted just from October 2021 as well as from April 2021. Gartner is seeing more and more demand to buy more software from CIOs and enterprise buyers than they predicted just last year.
- But the growth rate in 2022 (9.8%) is down from 2021 (15.9%), and down from earlier estimates (11.5%). 2022 is still predicted to be a great year, but not quite as great as 2021, and both behind 2023 estimates and behind earlier predictions of 11.5% for the growth rate for 2022.
- Software and SaaS is the fastest-growing segment in IT, where the most growth is. All of IT spending is predicted to grow at a healthy 5.5% in 2023 and an OK rate of 4.0% in 2022. But it’s software and SaaS growing by far the fastest (9.8% in 2022 and 11.8% in 2023), far outpacing the rest.
2022 isn’t shaping up to quite as strong for enterprise spend as we might have hoped. But it’s still quite strong, with an even bigger 2023 on the horizon.
Put differently, enterprise software spending globally was $529B in 2020. In 2023, it will be $750B. That’s a tailwind almost all of us are drafting on.
What inning are we in, in SaaS? The data above suggests maybe the 3d. As emerging vendors, you’re not just taking share from the incumbents. You’re riding a huge wave of overall growth in spend in enterprise software. That will make room for 100s more unicorns.