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It prompted a swift rebuttal from SuccessFactors, which was one of the star turns at SAP’s big user conference which is also underway in Florida; the company may have renewed a NetSuite licence, but it won’t be using it.
For a short while the “sale to SAP” looked like an enormous triumph for NetSuite; more sober analysis suggests that the company is still looking for all the marketing oxygen it can get in the highly competitive cloud computing market.
Certainly there is little love lost between the two companies – not surprising given that Oracle’s Larry Ellison is the majority shareholder in NetSuite. Asked directly about SAP and its cloud strategy Mr Nelson said; “SAP was a fine product for the era in which it was invented – before the internet,” adding that it could take 20 years for the company to get its cloud computing offering right.
It’s clear that in the space of just 13 years NetSuite has become a significant player in the mid market cloud computing ERP space – but it’s still a relatively small player.
While it may be enjoying rapid growth – Mr Nelson quoted statistics pointing to 84 per cent growth rates – it’s off a relatively low base. This year the company estimates it will achieve 30 per cent top line growth, and achieve revenues of $US300 million.
It claims 12,000 customers internationally. However in the past most of its user base have been small businesses.
In 2010 the average NetSuite sale was worth $US20,000 a year. But the company is now starting to push into the larger client market and Mr Nelson said that doubled last year to $US40,000.
