Following ServiceNow’s acquisition of VendorHawk in late April Flexera have followed suit with their acquisition this week of Meta SaaS. Clearly this is a market where swift exits for founders and investors is possible. VendorHawk was founded in December 2015, had 7 employees at acquisition, and had received funding of $1.3m. Meta SaaS was founded in September 2016, had less than 10 employees, and had received funding of $2.2m.
Other players in this market which remain independent include Blissfully, Cardlife, Cleanshelf, and Zylo. Based on data immediately available Zylo are the largest of these, boasting clients including Spotify and Uber. These providers tend to differ from the traditional players in how they discover SaaS applications and this is the likely reason Flexera have acquired them. Companies like Snow and Flexera know how to develop agent-based (and agentless) discovery tools for software installed on devices but until recently have been slow to innovate in capturing SaaS spending. With SaaS spending expected to grow to almost $100bn by 2020 there is an opportunity which requires tooling now. SaaS Optimisation providers typically report 30% of SaaS spending is wasted so that’s $30bn of savings ITAM providers can unlock for their customers.
The question must be, who’s next? Which of the traditional SAM providers will add one of these innovators to their portfolio? Snow Software have recently announced a big upgrade to their cloud product so they are clearly devoting resource to developing an in-house capability. They can now provide discovery and optimisation for around 1000 SaaS apps. Aspera are targeting Salesforce optimisation. The SaaS optimisers are complementary technologies for agent-based SAM discovery and inventory tools. Where they excel is the way in which they gather data from multiple sources – Accounts Payable and Expenses, SSO providers, proxies, and CAS brokers. SAM best practice states that you should always have multiple inventory sources and these methods will undoubtedly discover usage that will be missed by a traditional inventory tool or browser plugin.
The ITAM Review will continue to watch this market with interest, and there will be further articles on SaaS optimisation over the coming weeks.