Just attend the @BessemerVP State of the Cloud pres at @SaaStrAnnual (from my kitchen).
Some quick learnings:
1 – SaaS Market Cap just hit $1Tn!
2 – Mket cap of the 5 largest SaaS companies grew 61x since 2008 to hit >$800Bn
3 – CAGR of public SaaS accelerated in the past 2 years pic.twitter.com/Bfu7KFlsXQ— Louis Coppey (@louicop) September 2, 2020
Microsoft, Google, Apple, and Amazon have made the headlines for a while for crossing $1 trillion in market cap each. That’s crazy growth — almost all fueled by the crazy growth of the Cloud.
No SaaS company is yet worth $1 trillion, though perhaps that is coming. What has happened, though, is the Top 30 SaaS companies together are now worth $1 Trillion.. That’s up from $800 billion just a little while back when we took a look at Cloud Decacorns.
That’s $1 Trillion in market cap from the SaaS leaders.
These are the best of times in SaaS indeed:
Given the incredible IPOs in the pipeline, we could be at $2 Trillion in the next 24 months. We’ll see.
A few other things we can learn from this analysis:
- Power Laws are here, too. The Top 10 SaaS companies have 70% of the market cap and value. A $2 billion market cap is amazing. But $20 billion is now becoming “common”, if that term can be used.
- Shopify is the crazy one. From $8 billion in market cap in 2017 to $117 billion today!
- Go long. Most of these names were worth a fraction of their current market cap at IPO. Zendesk IPO’d at $1 billion. Today, ti’s worth $11 billion.
- You Can Grow Your TAM. Almost all the leaders here started off doing something “smaller”. Salesforce just did SFA. Slack was a single org self-service app. Veeva added an entire, larger second product. Twilio expanded into contact center and email and more. Shopify added a wildly successful enterprise offering. RingCentral went from SMB to enterprise-grade contact center. Zoom used to be a B2B app. 🙂
