a decade in saas

© Copyright NetSuite Inc., All Rights Reserved.

A Decade in SaaSStories from the front line

A Decade in SaaSStories from the front line

Dean StockwellProfessional Services Director (APAC)

NetSuite Inc.

Dean StockwellProfessional Services Director (APAC)

NetSuite Inc.


Agenda

Benefits of SaaS

The Real-World of SaaS

– Customer Expectations

– Enterprise SaaS - Case Study

Asia/Pacific Landscape

Future of SaaS


3

Forward Looking StatementsThis presentation contains “forward-looking” statements that involve risks, uncertainties

and assumptions. If the risks or uncertainties ever materialize or the assumptions prove

incorrect, our results may differ materially from those expressed or implied by such

forward-looking statements. All statements other than statements of historical fact could be

deemed forward-looking, including, but not limited to, any projections of financial

information; any statements about historical results that may suggest trends for our

business and results of operations; any statements of the plans, strategies and objectives

of management for future operations; any statements of expectation or belief regarding

future events, technology developments, or enforceability of our intellectual property rights;

and any statements of assumptions underlying any of the foregoing.

These statements are based on estimates and information available to us at the time of this

presentation and are not guarantees of future performance. Actual results could differ

materially from our current expectations as a result of many factors, including but not

limited to: quarterly fluctuations in our business and results of operations; our ability to

address market needs and sell our applications and services successfully; and the effects

of competition. These and other risks and uncertainties associated with our business are

described on Form S-1/A filed with the SEC on December 19, 2008, and available via

www.sec.gov. We assume no obligation and do not intend to update these forward-looking

statements.


No Such Thing as a “Free Lunch”

Introduction to Netsuite

Questions for Audience

– Knowledge of Netsuite prior to this week ?

– Who is using SaaS technology ?• Webex ?

• Internet Banking ?

• Hotmail ?

– What is the difference between SaaS and “The Cloud”


1998: NetSuite Founded by Larry Ellison and Evan Goldberg

2000: Creates World’s First Integrated SaaS Suite Application

2006: Grows to nearly 6000 customers

2007: IPO on NYSE - Ticker Symbol “N”

2008: Introduces NetSuite OneWorld, enabling multi-company consolidation in the cloud

NetSuite Background


The Typical On-Premise Way

Accounting

SFA

Support

WebWarehousing

Excel


7

Marketing Campaigns

Sales Force Automation

CustomerSupport

Partner Relationships

Order Management

Accounting/Financials

Inventory

PayrollPurchasing

Shipping

VendorPortal

Customer Portal

Web Site

Web Store

EcommerceManager

ShippingManager

Support Manager

CEO

Sales Rep/Manager

CFO

SINGLEDATA

REPOSITORY

Customers

Vendors Partners

The NetSuite SaaS Way


8

Netsuite Annual Revenue

2008 Revenue: $152.5M (40.5% increase YOY)

Over 1.3 Million Unique Log-Ins

Q4 2008 Financial Results press release dated 2/10/09 contains GAAP to

non-GAAP reconciliation and is available on NetSuite website.

SaaS Gaining Momentum

$1.1$3.1

$8.3

$17.7

$36.4

$67.2

$108.5

$152.5

$0M

$20M

$40M

$60M

$80M

$100M

$120M

$140M

$160M

2001 2002 2003 2004 2005 2006 2007 2008


Worldwide SaaS Market Growth 2007-2012

CA

GR

0.00%

2.00%

4.00%

6.00%

8.00%

10.00%

12.00%

14.00%

On-Premise ERP

16.00%

18.00%

Source: IDC and Gartner

SaaSCRM

20.00%

22.00%

24.00%

26.00%

28.00%

On-Premise CRM

11.9%

7.6%

18.5%

SaaSERP

26.8%


McKinsey Says 40% Better TCO

1,6402,298Total Costs (including those not shown here)

092Unused licenses

0308Unscheduled downtime

Other

1,500480User licenses, subscriptions, maintenance

Software

0750Data center facilities rental, operations, security, compliance,

monitoring of incident resolution

094Mainagement, customization of business process change

34101Training

Ongoing operations

030Application infrastructure testing, deployment

054Basic Infrastructure testing, deployment

72108Customization, integration

Implementation, deployment

Software as a Service Software on Premises

1,6402,298Total Costs (including those not shown here)

092Unused licenses

0308Unscheduled downtime

Other

1,500480User licenses, subscriptions, maintenance

Software

0750Data center facilities rental, operations, security, compliance,

monitoring of incident resolution

094Mainagement, customization of business process change

34101Training

Ongoing operations

030Application infrastructure testing, deployment

054Basic Infrastructure testing, deployment

72108Customization, integration

Implementation, deployment

Software as a Service Software on Premises

Total Cost of Ownership, $ thousand

Sample deployment of CRM software (200-seat license)

The McKinsey Quarterly, Delivering Software as a Service 6/2007


Other Benefits of SaaS

Instant access, anytime, any place

All users on a single version

– Upgrade friendly architecture

– More efficient to support, maintain and educate

Real-time data, multiple geographies

Real-time implementation

Device connectivity

Application connectivity

– Within the cloud


The Real-WorldCustomer Expectations

100% Available, no down-time

100% Secure

Self-Implementing, self-configuring

On-premise option available

– Bigger companies

Free software / free implementation

– Isn’t everything on the internet free ?


The Real-WorldReality Check

99.5% Available

– Uptime to this level should be guaranteed by the vendor

Secure and audited to global standards

– Transparency, SAS70 etc.

On-Premise option not feasible

– Financial benefits of SaaS require volume

You have to pay for it

– Zero piracy issues (so far)


Case Study - Jollibee

Largest fast food company in the Philippines

Heavy investment in on-premise enterprise ERP

Requirement for system in emerging markets

Need to do it much faster and cheaper

– Needed to be live in less than 6 months

No desire to recruit IT staff in each of the emerging regions


Business Benefits Realised

Time to Value

– 4 months for SaaS v 18+ months for on-premise

Lower Cost of Entry

Lower TCO

Centralized Deployment

– Tighter control of the project

– Go Live = User Training

More Responsive Platform

Enabler of Shared Service Strategy


SaaS Trends – Asia/Pacific

Strong appetite for SaaS

Average Customer Size is Increasing

– Increased confidence

– Awareness at “C” level

– Benefits difficult to ignore

Global subsidiaries, smaller footprint

– Emerging markets driving adoption

– SaaS More Popular for Green Field Sites

– Often no Legacy Systems to replace

Political considerations

– Most SaaS vendors host in US


Asia/Pacific – Early Adopters

Australia

– Early adopters of new technology

– Large base of SME’s

Philippines

– Entrepreneurial

– Leverage SaaS infrastructure v build

Singapore

– Entrepreneurial

– SME’s with Government incentives

– Enterprise more conservative

– SI’s need to take a leap of faith


The Future of SaaS (next 3 years)

Further Innovation

– We have only just scratched the surface

– Most new development projects on SaaS platform

– Most legacy vendors trying to get there

– Increased verticalisation

Cloud Connectivity

– Application integration in the cloud

– Cross-application automated workflow

– Device proliferation

Improved Infrastructure

– Redundancy and Reliability

– More “Oxygen”


“Everything that can be invented, has been invented”

Charles H Duell, Commissioner US Patent Office, 1899


Web FactsThe last 5,500 days…..

Most fault-tolerant machine ever built100 billion clicks per day1 billion PC chipsConsumes 5% of the planet’s electricityRoughly the same complexity as one human brain….

But your brain does not double in power every 2 years…..

At the current rate of growth, by 2040 the Web would exceed the processing power of humanity

“5000 days of the web”, Kevin Kelly


Q & AQ & A

a decade in saas

Technology

cloud copyright netsuite

netsuite oneworld

netsuite questions

netsuite background

statements of assumptions

forwardlooking statements

audience knowledge of

saas technology