At Montclair Advisors I work with many different types and sizes of software firms that are jumping into the SaaS business model for the first time.   Here are a few tips that I would tell a new client who is looking to get into the SaaS business in 2012.

Think “Whole Product”

A SaaS offering is more than just software, it is also the services to get the product up and running, training, support, the infrastructure and security.

For most SaaS firms, they really view their platform as synonymous with their company’s overall brand, which includes more than just the technology. This brand promise is a product experience that is smooth and consistent. It also takes into account issues like business continuity and being able to quickly restore systems and data after an outage. This also means that SaaS offerings must understand and how to properly manage security and compliance concerns for large, complex customers.  In some cases this promise needs to do a high level of monitoring and even anticipate and correct problems before they occur.

When considering the professional service component of a SaaS offering, there should be extra focus on efficient provisioning and on-boarding of new customers. It is important to make this initial experience quick and easy in order to improve the customer’s overall time-to-value. By combining many customer-facing functions like support, training and service into a Customer Success team is also another popular way of trying to deliver a positive ‘whole’ product experience.

Focus on Adoption and Consumption

The economics of SaaS requires both a high rate of new customer sales combined with a better than 90% renewal rate for the financial model to work. The trick that the really fast growing SaaS firms have discovered is that up-selling additional capacity and cross-selling new products not only increases top line revenues but also improves overall Customer Acquisition Costs (CAC) and business margins.

The objective in any software company should always be to build a satisfied customer-base, but in the SaaS model you can’t stop there, it is important get customers to actively use and adoption the product. When a product is easy-to-use, intuitive, being used every day, and built on a solid platform, then it can become viral. Viral products like DropBox, Yammer and Salesforce.com’s Chatter can throw off high marginal add-on sales, that can boost a SaaS company’s revenues very quickly. This type of product consumption is important for all SaaS company’s even if the use of their product may never go viral.

It’s All About Growth

Many new SaaS firms spend a lot of time and capital building out their products, which makes sense. Often they underestimate the amount of effort and focus required to build a high growth sales and marketing machine. Because it is hard initially to jump start the recurring revenue model, it is important to develop a highly productive sales methodology, usually based on a ‘land and expand’ approach. For the most successful SaaS companies (SuccessFactors, Salesforce.com, Workday), an aggressive Compound Annual Growth Rate (CAGR) is imperative to building a profitable company.  Many of these firms, even though they are large, are still growing at 30-50% per year.

In order to build this sales and marketing engine, it requires a meaningful investment in lead generation, a sales organization that separates hunters from farmers and has a set of metrics that are tracked at least weekly. For ISV’s that are moving to a SaaS model, don’t co-mingle the SaaS and non-SaaS sales teams. Each sales team should be very focused on selling a single type of product or a single function. For example, having a SaaS team that focuses on selling only new SaaS deals, another is only doing renewals or up-selling.

Because products and markets are different, it is important to constantly be testing lead generation, pricing, packaging and sales processes in order to find the best one that works for your business. If something doesn’t work, stop doing it, and pivot to another idea. The best SaaS companies are always testing and trying to improve their revenue generation processes.

Optimize Cost of Goods Sold

Most SaaS executives are focused on their COGS and how best to optimize them. This is why many early SaaS firms use free open source software and Infrastructure-as-a-Service providers to build out their platforms, or outsource components of their business to partners to save money. The best way to optimize COGS is to reduce the number of people required to on-board, provision and operate your SaaS platform. It is better to automate as many of your processes as possible, which not only saves precious capital, but also can often improve the overall scalability of the business.

One the best examples of this type of automation is with the popular commercial SaaS storage solution DropBox [Check out this video]. They have built a service that is easy to use, self-provisioning and needs no human intervention. This is why they were able to on-board 40 million new customers during the last 12 months with a net increase of only 7 people across their entire company! This is where SaaS companies can become very profitable and grow very quickly.

Another area that can really impact COGS is related to the 30-day trials associated with most SaaS software. Without a scalable platform that has a sufficient level of automation, the launching, management, tear down and re-provisioning of resources will all be done by an ever growing team of professional services or IT professionals. Best practice is to leverage a multi-tenant platform and automate everything possible.

Strive for Independence

For ISV’s who are either transitioning to or launching a new SaaS offering, it is important to seriously consider keeping the new SaaS organization separate from the main business. I have seen many ‘shared service’ models where different groups share sales, operations, demand generation, services and even support and they experience a lot of challenges. The SaaS business model in many ways is unique and conflicts with most traditional software business practices.

For example, professional services in most software companies is a revenue-center and they are always looking for ways to generate additional projects and revenue. At a SaaS company, the professional services team is doing the opposite.  A SaaS services team is trying to minimize their level of involvement with the customer, and the less services involved in setting up a SaaS product, the better. This would be a difficult group to manage if you have both a revenue quota and are also trying to minimize revenue associated with SaaS accounts.

The other reason I often recommend creating an independent group for transitioning ISV’s is that the overall rate and pace of SaaS companies is quite different than traditional software firms. SaaS firms develop products more quickly, sales processes are faster, deployments are more rapid and this mismatch in speed creates a lot of stress when traditional ISVs try to adopt this rate and pace.

It is also important to continue the care and feeding of the core business and realize that is also a critical success factor. By allowing this type of co-existence you can move at the right rate and pace, while continuing to build and run your core business.

There are many other tips and tricks to starting your SaaS business.  Feel free to email me at kevin@montclairadvisors.com and I have some other materials that can be helpful for those who are new to the SaaS model.

For the SaaS world, Oracle’s OpenWorld has lately been all about hardware and the Exastack products. These offerings have limited appeal to all but the largest SaaS ISV’s.   The good news is that there were some new announcements though that were much more interesting for the SaaS community at last week’s Oracle OpenWorld in San Francisco.  Here is a quick summary of the news and drama:

Oracle Public Cloud

This was a welcome move by Oracle, to finally embrace their vision of the Cloud. Oracle is re-packaging many of their assets including the Exastack, Java, and the Oracle Database into a pay-as-you-go service, which should be appealing to smaller customers as well as ISV’s looking for an easier way to leverage Oracle technology.

The key theme that Larry Ellison [video] kept emphasizing was that the Oracle Public Cloud is standards-based and will allow a customer to port products they built on their Cloud to other standards-based Clouds or even on-premise. Larry was quite funny in his keynote by referring to his competitor’s Clouds as the “Roach Motel of Clouds”, because once you go in, you never come out.

In addition to just pure infrastructure services, Oracle will also make available its applications including Fusion CRM and Fusion HCM products as their collaboration platform.

Here are some other interesting articles on the Oracle Public Cloud:

• Ellison Reveals Oracle’s Public Cloud; Calls Salesforce The ‘Roach Motel’ Of Cloud Services, Rip Empson, TechCrunch.
• How Oracle’s Public Cloud Is Different, Charles Babcock, InformationWeek.
• Oracle Public Cloud might be extensive, but it’s boring, Larry Dignan, ZDNet.

Oracle Social Network

Sounds a little like that movie about Facebook. The Oracle social strategy is to provide an easy-to-use interface for both their new Fusion applications as well as the Oracle Public Cloud.

Their social network looks remarkably similar to the Chatter offering from Salesforce.com. The Oracle Social Network allows you to track projects by activity streams, follow people and objects as well as standard collaboration inside the enterprise.  There is no social analytics capability similar to the Radian6 offering that Salesforce offers, but I think this is just version 1 of the Oracle Social Network.

This new collaboration tool will also be available on-premise as well as in the Cloud. The Oracle Social Network also provides an iPad front-end that should be appealing for mobile workforces

Fusion Application Suite – Now Ready

Last year there was a quiet announcement of the general availability of the Oracle Fusion applications. This year was much different with Larry Ellison announcing the full suite of Oracle Fusion apps and he even did a demo of their new Fusion CRM system (BTW he did a great demo).

Oracle spent six years to completely re-write all of the PeopleSoft, Siebel, Hyperion suites of applications and now there is a new generation of Fusion applications including;

• Fusion CRM
• Fusion Financials
• Fusion Governance, Risk and Compliance
• Fusion Human Capital Management
• Fusion Procurement
• Fusion Project Portfolio Management
• Fusion Supply Chain Management
• [Photos] Fusion Apps

The interfaces look modern and don’t appear to be warmed over client/server applications. Coupled with the Oracle Social Network, these products should be quite competitive in the SaaS market. All of the Fusion applications are available either on-premise, as a managed service and as a SaaS service through the Oracle Public Cloud. There weren’t a lot of details about this hybrid architecture and like the Oracle Public Cloud and Social Network, there will probably be more details early in 2012.

Salesforce – Occupy OpenWorld

As always, there is some great theater at OpenWorld when Oracle rescheduled Marc Benioff’s keynote to Thursday morning (the day the conference ended) and he went rogue. Salesforce quickly shifted the keynote to the hotel down the street. Montclair Advisors was right at the press conference but as it turned out it was basically the same Social Enterprise keynote that was delivered at Dreamforce.

A lot of kudos goes out to the Salesforce marketing team for being able to pull off such a solid event, including streaming the keynote speech over the Internet, in less than 24 hours. Talk about business agility!

Here are some pictures from the event and a few articles with more controversy:

• [Video] Marc Benioff’s rogue Oracle OpenWorld keynote.
• [Pictures] Montclair Advisors was at the rogue Salesforce press event, got some good shots.
• A Keynote Cancelled, A Database Dropped, Lauren Carlson, Software Advice.
• Benioff, Denied OpenWorld Keynote, Mounts Podium Anyway, Charles Babock, InformationWeek.
• Oracle OpenWorld snub fails to put off Salesforce CEO, Brid-Aine Parnell The Register.

Company:            FrontRange Solutions

Started:               2000

Located:              Pleasanton, California

Products:             Help Desk, IT Service Management, IT Asset Management, Customer Service, CRM, Voice and SaaS².

Geography:          Advanstar Communications, Amercian Stock Exchange, Chicago White Sox, City of Des Moines, Instron Corporation, SHI and Swisscom

Website:             FrontRange Website

Blog:                  FrontRange Blog

Twitter:              @FrontRange

Recent News:

FrontRange Solutions Announces New ITSM SaaS Solution

FrontRange Solutions delivers much anticipated IT Service Management Enterprise

FrontRange Solutions Announces Release of new Service Catalog Solution

I asked Kevin Smith, FrontRange’s vice president of marketing a few questions about his newly launched SaaS business and his view on the market going into 2011.

Why did you launch a Software-as-a-Service business?

Even as a large, profitable on-premise software company, about five years ago we saw a growing demand in the market for SaaS-based service management and help desk solutions. We knew from our experience that just hosting our existing products like some of our competitors had done in an ASP-type of solution wasn’t a viable strategy. It also wasn’t what customers wanted.

So we decided about three years ago to build a new product that was a pure multi-tenant solution and we have invested millions of dollars to create our new ITSM SaaS solution. When we looked at our version of SaaS, we think of it more as Solutions-as-a-Service that is included in our SaaSIT family of solutions including service desk, asset management and customer service.

What lessons have you learned in building your SaaS business?

One of the main lessons we learned was that our customers still want on-premise solutions, especially companies vertical industries such as healthcare, government and financial services.

Customers we have talked to want a hybrid model, with a single provider. They want their divisions and headquarters to be able to use either on-premise or SaaS, based on their needs, but be able to exchange information between both types of products. We believe it is possible to have world-class products across both on-premise and SaaS. FrontRange will continue to invest in both product lines and create distinct product roadmaps but also look for synergies.

We understand that SaaS is a different business model, including different products, customer service, sales, services and even training. FrontRange used a tiger team approach where we brought in key talent who understood SaaS processes in development, operations and other areas. The idea was to infuse the company with some SaaS DNA in a few important areas, and we will build up this expertise over time. We are also using partners to help us with our SaaS offerings including Amazon Web Services’ EC2 hosting infrastructure.

Interestingly we have seen a halo effect with our existing on-premise customers as a result of having a SaaS product strategy. For instance we have customers who have been using our HEAT product for many years, and had a corporate mandate to look at SaaS, so when they learned about our SaaS strategy it just reinforced their desire to stay on product maintenance.  This was attractive for existing customers using our on-premise products because they liked the future opportunity to mix and match both delivery options.  Our pipeline for new customers also contains many hybrid deals where companies want both on-premise and SaaS offerings.

We were also fortunate that our company was able to fund the build-out of our SaaSIT product suite from our normal operating income and cash over the past three years and were even still able to remain profitable.

The SaaSIT product felt like it took a long time to develop, and at it was a difficult process, but we are now excited to have a truly competitive SaaS service offering to sell.

By Kevin Dobbs

Montclair Advisors, LLC

It is always hard to predict the future, but here are my 10 Predictions for the SaaS market in 2011, and they might just happen:

Blockbuster Subscription Software IPO’s

A number of large consumer subscription software players including Facebook, Groupon, LinkedIn, Zynga and Skype could really open up the public markets with a major blockbuster IPO (or IPO’s) in 2011.  SaaS firms that look to get everyone’s attention with potential IPO’s next year include Cornerstone OnDemand, Workday, Marketo, Service-Now and possibly Plateau.

Major Players Merge to Form the Next Big SaaS Brand

So my prediction (which is a pure guess) is that SuccessFactors and Taleo finally get over their respective CEO ego issues and decide to merge.   Sounds a little crazy, but when you really consider their product portfolios, there might not be as much of an overlap as you might think.  SuccessFactors is basically a performance and analytics company and Taleo is a recruiting and learning (after acquiring Learn.com) company.  They both have some additional components that could be plugged into to create a more comprehensive suite of CPM and Talent Management offerings.

This would also create a combined company with a market cap approaching (SFSF + TLEO) $4B and annual revenues in excess of $400M, which would be the second largest SaaS firm in the market, and a clear leader in their space.  Another potential marriage might be Concur and Ultimate Software.

Oracle Finally Pulls the Trigger on NetSuite

It seems like most Oracle SaaS rumors involve the acquisition of Salesforce.com, and that may happen some day, but the more likely combination for 2011 is NetSuite.  Larry Ellison is a major investor in NetSuite (early investor) and own/controls more that 50% of the company’s shares.  He may come to the conclusion that he needs some real SaaS DNA inside of Oracle to help grow their Fusion business in 2011 and beyond.

SAP Throws in The Towel and Buys Leading SaaS Player

Similar to the realization that many other major traditional ISV’s will come to in 2011, that they are too far beyond in SaaS to catch up organically, SAP will buy their way into SaaS.  The Business ByDesign project for SAP, by some estimates, has cost more than $1 billion and there isn’t much to show for it.  I always thought that the Sybase acquisition was just a smoke screen to cover up how little progress has been made with BBD at their most recent Sapphire user meeting.   Like Oracle, I think SAP reaches out into the market and purchases a SaaS firm to jump start BBD.  RightNow would be an interesting choice since SAP wants to make a splash in the CRM market.

Master Brands Continue to March Towards SaaS

These big software companies are no longer just paying lip service to SaaS or the Cloud, they continue to catch up with the subscription software market transition that is happening everywhere.  All sizes of customers who were battered during the recession are no longer interested in spending a lot of capital and time that has been associated with traditional software projects and are becoming increasing comfortable with SaaS.  This shift in the Software market is massive and is going to take at least 10 years, and we are probably only in the second year (post-recession) of this shift.  Continue to look to see what SaaS moves firms like Oracle, SAP, HP, CA and Infor make in 2011.

Continued Explosion of PaaS offerings

Look at Salesforce.com’s recent moves to expand their Force.com Platform-as-a-Service portfolio with VMForce and then buying Ruby on Rails provider Heroku for over $200 million.  Beyond Force.com there are many other offerings here today and coming in 2011 including App Engine by Google, Apprenda, Azure by Microsoft, Corent, Engine Yard, Facebook, Flex by Adobe, Fusion by Oracle, Intalio, IPP by Intuit, LongJump, Nimbula, SuiteCloud by NetSuite, and Wolf Frameworks.

As long as traditional ISV’s continue to move towards SaaS, there will be a green field opportunity for all types of PaaS solutions. Look for several of these firms to be acquired in 2011 by larger ISV’s.

Salesforce.com Continues to Expand Beyond CRM

After attending Dreamforce this month, it was curious to see a number of Force.com firms offering ERP extensions starting to gain real market momentum. Companies like FinancialForce.com (they purchased Appirio’s PSE business) who are delivering a growing suite of financial and accounting applications, JobScience who continue to build out their Talent Relationship Management suite on Force.com, Less Software who is selling a targeted Supply Chain Management solution and even Remedy’s Service Desk offering, RemedyForce Cloud.   If Salesforce offers an attractive exit for any of these firms or their Force.com products, like they did with Heroku, then it might be possible to do a quick roll-up of key partners to create a competitive Cloud-based ERP solution.

Interestingly this type of move might be triggered by Oracle buying Netsuite or Workday going public.

Fake SaaS Firms That Use Private Clouds Will Loose Altitude

Although Private Clouds might be a viable alternative for enterprises who are looking to leverage the economics of the Cloud, for software companies this type of approach will only provide short term ‘Fake SaaS‘ types of solutions.  This type of business model of hosting single-tenant software was known as Application Service Providers (ASP’s) and none of these companies that emerged about 10 years ago were able to find a business model that really scaled profitably.   Private Clouds will offer a short term technology transition steps for software companies who are moving away from just offering traditional on-premise software but this trend will really start to fade by later next year.

New Revenue Streams for SaaS Firms That OEM

At Dreamforce ‘10 Salesforce.com announced that they are launching their new Database.com offering, a Database in the Cloud. What was interesting about this news is that Salesforce is really just reselling a private-label version of Oracle’s database technology.  For Salesforce this is a unique way to take proven Oracle software, designed for on-premise deployment, and create a true subscription-based version of this product.  No doubt that Salesforce will need to do some work to create a massive multi-tenant version of an ORACLE database and then deliver it as a service, but they are already doing this today through their Force.com platform.  This could be a significant new revenue stream for both companies and look for other SaaS firms to try OEM’ing their software as a way to improve their CAGRs in 2011.

This should be an interesting year as the economy improves and the SaaS market really begins to gain some serious momentum.  It should be a fun time to be in the Software business again.

Kevin Dobbs,  Montclair Advisors, LLC

By Kevin Dobbs

Montclair Advisors, LLC

One of the questions that I get quite often from firms that are starting down the path towards selling SaaS solutions, ‘should we use the same sales team to sell both our on-premise and SaaS solutions?‘ It seems like this would be easy and you should be able to definitely leverage your existing sales team to penetrate not only prospective accounts but also with existing customers.

No one wants to re-invent or re-invest in building out a new SaaS-specific sales team but this is critical to building out a successful SaaS business.  What many executives overlook is that SaaS is not just a delivery model but it is really a truly different business model.  I thought it might be helpful to use this table to illustrate those business model differences and why creating a specialized sales team is necessary.

Let’s review some of these important differences in each sales approach and how it affects the typical software sales rep:

Value Proposition: Traditional software is sold to solve a targeted business requirement and then customized to meet the specific needs of a customer.

SaaS takes a different approach.  It is usually sold with the promise of lower costs, more rapid time-to-value and ease of use.  This is accomplished using a standard system and configuration that is not tailored or customized for each customer. These are two very different value propositions and would be hard to expect every sales rep to be able to master both sales strategies.  Keep in mind that these two value propositions also appeal to two very different buyers; business buyers and IT.

Procurement:  Similiar to the value proposition, positioning the value of of a subscription purchase versus the actual purchasing of a software license are quite different.   After the recession, and part of our new normal economy, most organizations are now leading with a the requirement of subscribing to software instead owning it.  This allows customers to keep their more cash on their balance sheets and longer term, save on hiring staff to manage their internal systems inside of their own data centers.

Sales Cycles: Customers are also looking for just enough software to get the job done and are not usually looking to purchase a lifetime’s worth of functionality anymore.  They want to purchase a small piece of functionality now and then grow their relationship with their software provider over time, once they know the software works and they are comfortable with this relationship.  This means that SaaS sales cycles are going to be much shorter than traditional, on-premise software sales transactions.

Transaction Sizes:  Because of the different buying behaviors associated with SaaS from traditional software, SaaS transactions tend to be much smaller.  This means that a SaaS sales rep is going to need to close more deals, more frequently in order to make the same quota target that a perpetual license sales rep is assigned.

Pricing:  Putting together proposals are always difficult, but asking a sales rep, or even sales management, to offer both license and subscription options is really complex.  I think this is also not a great idea because it ultimately confuses the customer, since they will try and normalize the pricing for both options, which is hard to do.  Comparing a SaaS solution to an on-premise perpetual license is like comparing apples to oranges, and your sales team needs to pick one of these solutions and really learn how to sell it.

Methodologies/Touch:  Best-in-class SaaS sales organizations is a laser focus on Customer Acquisition Costs (CAC).  Living with the reality that the majority of your revenues will come in over the life of any contract, it is imperative to keep your sales costs low.  A SaaS model doesn’t lend itself to using the high-touch sales model, or engaging the ‘cast of thousands‘, to come in and get deals done.  Most SaaS firms operate a lower-touch model using tele-sales, remote demonstrations, and many automated self-service tools to assist the sales team in getting deals done quickly.

Channels: Effective use of indirect channels is another way of lowering customer acquisition costs.  Although some traditional software companies use channel partners to sell their products, it appears that the use of channels is really gaining popularity among SaaS providers.  Many SaaS firms are complimenting not only their tele-sales capablities but also using partners to deliver value-added services as well.

Demos:  Another way of reducing the cost of sales is to be more selective and smart about how customers are exposed to a software providers’ solutions.  This is usually accomplished by showing the software either using a Web-based conferencing service or some type of self-service environment.   This is quite a different approach than what was done with on-premise software, which was done in person and using a highly scripted demo.

Trials:  In the past, if a customer wanted to get their hands on the software and really use it, the only way that can be accomplished was with a Professional Services team and a conference room pilot.  Most SaaS companies allow prospective customers to play with their products by offering them a 30-day trial, after a simple self-service sign up and a quick tutorial.  This automated approach is cost effective and allows a SaaS firm to manage potentially hundreds of product trials with very little support personnel required, and this is a great source of qualified leads.

Renewals & Customer Relationships: This is another contrast between the two models. In a traditional software company the customer relationship is usually dispersed among various functions including Sales, Support and possibly Professional Services.  In SaaS firms the customer relationship and the renewal process are both very important, and usually have clear ownership, usually with the Account Management organization.

When you consider all of the differences in these two approaches to selling traditional software and software as a service, it is not reasonable to have the same reps trying to master selling both options.  The best sales reps are always focused on selling, hitting quota, and earning commissions.  Sales reps will sell what they are comfortable with and when considering a SaaS transition, it is best to create separate teams, with one that can specialize in the SaaS value proposition, solution, sales methodology and can make money on the SaaS-specific comp plan.

When firms make it simple for their reps to sell, you will get the sales momentum you are looking for in all of your lines of business.  You don’t want your sales reps to be the ‘jacks of all trades and masters of none‘, because that isn’t the formula for SaaS sales success.

Company:             Wolf Frameworks

Started:                2006

Located:               Bangalore, India  and Herndon, Virginia

Geography:          Global

Market:                Cloud and Platform-as-a-Service

Products:            Wolf Frameworks PaaS

Key Customers: TRA, GMR, Wipro, Delhi Frieght Carriers, HLB Mann, eCounting, Head Start, Juice Junction, SEDS and eDok

Website:             Wolf Frameworks

Blog:                   Wolf PaaS Blog

Twitter:                @WolfPaaS

Recent News:

ARTIST - Learn2turn builds E-DoK on WOLF PaaS

I asked Sunny Ghosh, WOLF Frameworks, Director and CEO a few questions about his business and his view of the SaaS and PaaS market in 2010.

How did you get started?

We started WOLF in 2006 as a pure play Cloud Computing company about 4 years ago. My partner Ralph Vaz started the company and we have both been in the technology industry for more than 30 years collectively.

We have worked on building many exciting products such as Invensys Skelta, Ebbon-Dacs, DB Query, Digimaker CMS that are widely used in the United States, Europe and Scandinavia.

We have seen technology as a growing burden to a customer’s business. When the technology changes like when COBOL transitions to Pascal, then to .Net, then to the next big technology. But why couldn’t technology be separated from the business because it doesn’t make much sense to tightly render a technology specific assembly for customers, which cannot be changed without technical programming? If you could just keep technology complexity and business requirements separate, then technology could be democratized and be made available to all sizes of companies.

Since the Browser is now the focal point of all modern computing, this means this is the end of the operating system and PC-centric approach to applications. By simplifying technology and making easier to access and less expensive, there is a much larger customer base to build our new business on.

Why do customers buy from WOLF Frameworks?

We have three different types of customers that we sell through our partners:

• SaaS Startup’s who have a great idea and want to build a prototype. This type of customer will be a single user and spend a month to build out their concept.
• Professional Services companies that offers business of services and wants to develop a tool that eliminates services time and to create a new recurring revenue stream.
• Enterprises and ISV’s that are looking to create line-of-business applications, and mashups like GoToMeeting integration with their CRM system or corporate dashboard solutions.

At WOLF we offer a zero code Platform-as-a-Service offering. Since most of our customers and users are business analysts, we needed to make a product that was easy to use. WOLF Frameworks consists of a five layer of architecture including XML integration, billing, presentation, application development and database layers.

WOLF Frameworks offers a variety of capabilities that make it a rapid development environment like the following:

• Templates
• Reports
• API’s
• Multiple devices
• Built in storage
• Business rules and workflow engine
• Access rights
• Support for multiple databases

All of these capabilities allow customers to develop applications 70% faster than traditional approaches at half the cost. Customers have used different types of applications including accounting systems and also electronic patient record system.

We also use open standards like XML, AJAX for inter-operability and portability. WOLF also is based on leading technologies like .Net, MySQL, and SQLServer. Our platform also works with leading Infrastructure-as-a-Service providers like Amazon Web Services, Rackspace and a Canadian provider iWeb.

The WOLF platform can also operate in a hybrid environment that supports both Cloud and on-premise applications. In fact we can take a license of your OnDemand Cloud application into your Private Cloud whenever and since we use a single code base it is possible to sync-up hybrid environments.

One of the major reasons customers like to use our platform is because WOLF Frameworks offers minimal vendor lock-in. Applications developed with WOLF are portable since they built with XML. The data, application design and the hosting providers can be moved, with minimal effort.

What broad trends are you seeing in the SaaS/Cloud markets?

Obviously one major trend is the emergence of the Platform-as-a-Service solutions like WOLF. Our customers are looking for fast, cost-effective ways to develop new Cloud-based solutions to either replace older products or to build out totally new ideas.

There are many different PaaS solutions emerging;

• Application-led solutions from Netsuite and Salesforce;
• Application development-centric solutions like WOLF, Force.com or Intuit’s Quickbase
• Development-centric solutions built on LAMP, Ruby on Rails or Microsoft’s Azure and
• Community-centric platforms like Linkedin and Facebook.

The other trend Private Clouds. Our same customers are looking for ways to extend their existing solutions out to the Cloud but are concerned about security and Private Clouds offer a great alternative to on-premise software. WOLF also offers the ability to develop applications that can run in a hybrid mode, both on-premise or in a Private Cloud as well as out in the Public Cloud. You can also migrate existing web applications into WOLF’s multi-tenant platform rapidly.

What’s your outlook for the balance of 2010?

We are feeling good about our growth and have 10,000 users today and look forward to continuing a solid 2010.