Contrary to popular belief, I predict companies will unplug noncritical SAAS services in a recession.
SAAS is mostly cloud based today and the cloud was post 2008. Most SAAS has never seen a recession.
This and SAAS not having reached market saturation make it’s revenue
1/2
SAAS is mostly cloud based today and the cloud was post 2008. Most SAAS has never seen a recession.
This and SAAS not having reached market saturation make it’s revenue
1/2
appear more stable than it is actually.
If I invent a new product in 1929, it doesn’t matter that 1931 is the depression, I’ll sell more that year than I did during 1929 boom times when our product was barely on the market.
E-commerce grew in 2009 & 2010, consumer spending
2/n
If I invent a new product in 1929, it doesn’t matter that 1931 is the depression, I’ll sell more that year than I did during 1929 boom times when our product was barely on the market.
E-commerce grew in 2009 & 2010, consumer spending
2/n
did not.
SAAS, is running out of virgin customers so when a recession hits, the monthly recurring revenue will not pay the saas vendors like first lien debt unless it’s absolutely critical software, which will also take a hit. See SAP’s revenue in 2009.
3/3
SAAS, is running out of virgin customers so when a recession hits, the monthly recurring revenue will not pay the saas vendors like first lien debt unless it’s absolutely critical software, which will also take a hit. See SAP’s revenue in 2009.
3/3
@eyemightbewrong fwiw fleshed out my thinking here
Bonus tweet: go to vista equity partners’ (Robert Smith PE firm, aka how he became a cantillionaire) and lmk how many of these companies you recognize and more importantly how many sound like critical or even essential services
vistaequitypartners.com/companies/port…
vistaequitypartners.com/companies/port…
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