What I Learned This Week

The software-as-a-service (SaaS) boom has only begun. Why the biggest winners in tech over the next decade may be enterprise software companies.

The meteoric rise of SaaS has been headline news in 2019. Microsoft now has more subscribers than Amazon Prime and Spotify combined, a SaaS transformation key to its valuation surpassing the $1 trillion threshold. Meanwhile, Zoom and PagerDuty saw their stocks spike more than 70% and 60% respectively, on their first day of trading. And then there’s the much-hyped IPO of Slack, which released its S-1 filing late last month. Yet, it’s not just the marquee SaaS names that are ascending. A basket of 50 cloud software businesses tracked by the Financial Times Alphaville averaged revenue growth of 35.2% last financial year, which compares to just 9.1% for the S&P 500. According to Gartner est…

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