What’s the value of being a First Mover in SaaS?
There’s clearly value there. But exactly how much? How often do first movers just dominate the world?
I stumbled onto an old image of The 10 Most Popular Apps in the Salesforce ecosystem in 2010/2011, and looking forward in time to where they are today is illustrative of many things in SaaS and Cloud:
6 of The Top 10 leaders “lost” in the market and are basically out of market. iHance was the Salesloft-Outreach of its day. It was truly magical back then. But it didn’t evolve (other than into a patent troll), and was acquired for a tiny amount by Inside Sales in 2014. LinkPoint 360? Not relevant today. Outlook integration is still critical, but became part of other applications. VerticalResponse at #4 sold for a token sum. But back in the day, it was how tons of folks did email marketing inside of Salesforce. Not sure what Campaign Calendar at #10 is, but it’s out of market. Maps integration at #7 is similarly critical, but I think just became part of everything else. Project Management at #6 evolved as a category, and the DreamFactory product which was very clever its day, faded as well.
1 vendor is still around and scaled — but the value proposition changed dramatically. InsideSales.com owned the PowerDialer in 2010/2011/2012/2013. But today, it’s a commodity function in every sales enablement app. A lot changed. They won their category, but the category changed on them.
2 out of the Top 10 sold, and evolved in different ways thereafter. Two of the Top 10 sold shortly thereafter, and probably too early in The History of The Cloud. EchoSign (which we founded, and in 2010/2011 was the #1 highest-rated Salesforce app) sold to Adobe in July 2011. Conga Composer, which was 100% bootstrapped with just 2 shareholders, shortly thereafter sold to a Private Equity firm for a tidy sum, an early example of the tide of PE capital that was going to come into SaaS. Today, Adobe Sign is nine-figures in ARR and Conga is approaching it. But probably, neither should have sold. Conga is run by a very strong team now and an IPO candidate in the coming years. EchoSign would have been a $200m+ ARR stand-alone business today.
ExactTarget IPO’d and then sold to Salesforce for $2.5 billion in 2013. Not bad.
But the meta-learning is that none of the generation that just IPO’d or is soon IPO’ing was in the Top 10 in 2010/2011. Many were around, but not in the Top 10 then.
First-mover advantage matters, and 4 of the 10 hit $100m+ in ARR. But that didn’t really stop anyone else who came later, as the Cloud grow 100x or more in size since 2010/2011.