How “As-A-Service” Companies Have Transformed Their Industries
As modern enterprises become increasingly reliant on digital economies and ecosystems, the need for on-demand flexibility and integration has never been more critical. “As-a-service” companies have emerged as one of the most effective solutions, bringing with it one of the most transformative business models in tech. Software-as-a-Service (SaaS) as well as Platform-as-a-Service (PaaS) and Infrastructure-as-a-Service (IaaS), are all available to offer more flexible, cost-effective, and scalable technology solutions for businesses across the world including WiseTech, Salesforce, and Teradyne.
WiseTech: Pioneering Logistics Solutions
WiseTech Global is a leading SaaS company that has revolutionised the way businesses interact with their supply chains. Founded in 1994, WiseTech aimed to address a glaring issue in the shipping and logistics industry – the lack of inter-communication and continuity. The result was their flagship product, CargoWise which was released in 2008.
CargoWise offers access to a comprehensive suite of tools from order processing and warehouse management to customs compliance and freight tracking. It can integrate with other software within the supply chain ecosystem, creating a unified and transparent platform, and allowing shippers, freight forwarders, and other key players to collaborate effortlessly, reducing bottlenecks and expediting the flow of goods. As a SaaS offering, CargoWise has also been able to adapt and adjust to client needs at a level that would be impossible for traditional mediums. Over the course of 2017-2022, WiseTech has spent over $695 million in research and development, resulting in over 5,300 product enhancements to the CargoWise application suite.1
As of 2023, over 17,000 companies worldwide use CargoWise as their core logistics infrastructure.2 According to WiseTech, 44 of the top 50 global third-party logistics providers as well as 24 of the 25 largest global freight forwarders utilise their SaaS solutions.3
Salesforce: The Customer Relationship Manager
There is perhaps no company in the world that is more synonymous with the SaaS business model than Salesforce. In fact, there are many who would credit Salesforce with the proliferation of subscription-based software as we know it today. Founded in 1999, the company has long been the undisputed leader in customer relationship management (CRM), and their SaaS offerings have been pivotal in transforming how businesses connect with their clientele. Salesforce combines a suite of its products on a single platform to help businesses automate marketing and sales processes, as well as harness data to allow for more personal and detailed customer experiences.
As the definitive ‘SaaS’ company, Salesforce’s steady expansion of its platform is a case study of taking full advantage of its always-online, always-updatable foundation. In just over 20 years, the Salesforce platform has developed over 300 tools, including integrating 71 separate acquisitions, into the most extensive ecosystem of applications in the CRM industry by far.4,5 This has ensured that their product can meet any and all needs of enterprises large and small, allowing it to remain the leader in an extremely competitive landscape.
Salesforce now has more than 150,000 customers and holds 19.8% of the CRM market, more than the combined market share of its next four largest competitors.6 Since its IPO in 2004, Salesforce’s revenue has increased more than 200-fold to over US$20 billion, having grown at an astronomical rate of 51.22% annually (CAGR).7
Uber Technologies: Bringing SaaS into the Everyday
Of all the well-known names in the SaaS landscape, Uber Technologies is perhaps the most familiar to the everyday consumer. Uber services both business-to-business (B2B) and business-to-customer (B2C) markets. Since its inception in 2009, the company has been a disruptive force that has completely reshaped the way we think about modern transportation. Its proprietary platform, which connected everyday drivers to riders, was so revolutionary that it created the “sharing economy”, an entirely new economic model, now used by fellow start-up successes such as Airbnb and Doordash.
Since its initial launch in California as a black cab hailing service, Uber has pushed itself to innovate on every front. Thanks to this continuous development, their platform now offers a wide array of services ranging from traditional ride-hailing and food deliveries, to freight and even helicopter bookings.8 Each of these segments now contribute significantly to Uber’s success. As of 2022, the combined revenue of all of Uber’s business segments totalled almost US$10 billion in revenue, up 82% from the year prior.9 Furthermore, over 130 million people used Uber monthly in 2022, culminating in 7 billion trips delivered by Uber drivers in total.10
By leveraging the strengths of SaaS – namely its scalability and flexibility – Uber has been able to provide the seamless and convenient user experience that propelled them into the service titan they are today.
Transformation As A Service
The services provided by these innovative software companies are now vital assets that allow businesses and consumers to scale rapidly and grow without compromise. Looking forward, whether it be logistics, marketing and sales, or ridesharing, SaaS and its counterparts will likely continue to be key players as we develop into an increasingly technology-driven world.
TECH: The Global X Morningstar Global Technology ETF (ASX: TECH) invests in companies whose principal business is in offering Software-as-a-Service (SaaS), Platform-as-a-Service (PaaS), Infrastructure-as-a-Service (IaaS), and/or cloud and edge computing infrastructure and hardware.