Copyright © Bessemer Venture Partners 2020State of the Cloud 2020 CO-AUTHORSByron DeeterElliott RobinsonHansae CatlettMary D’Onofrio
2 | State of the Cloud 2020Cloud macro trends, growth strategies for founders, 2020 predictions, and why we believe the future is forged in the cloud. In 1998 when Netsuite was founded, and then in 1999 when Salesforce first launched, many experts in tech believed the cloud was just a fad. Even leaders like Larry Ellison and Steve Ballmer were early skeptics. How could a business with significant development and sales costs upfront, and payment terms on the backend, ever work? Since the early 2000s, the industry has seen exponential growth, both in private and public spheres. Many companies have cloud strategies in place, but they are amidst their digital transformations. We believe the future of technology is forged in the cloud, and after two decades of growth it’s just the beginning. In a time when founders and investors are faced with unprecedented market volatility, it is especially timely to step back and look at the long arc of technology, and the cloud computing revolution in particular. In Bessemer’s State of the Cloud 2020 Report, we share twenty years of data on the private and public cloud market trends, dive into the time tested tenets that early-stage cloud founders need to prioritize for growth, and of course, our predictions which explain the emerging categories we’re eyeing to spot promising new companies.
3 | State of the Cloud 2020The cloud industry from 2000-2020 In 2000, top private cloud companies included, Salesforce, Netsuite, Trigo Technologies, EchoSign, and Paypal, but there were zero private companies that were valued $1 billion. It wasn’t until 2010 did the industry see a privately held company, LinkedIn, reach a $1 billion+ valuation. So much has changed in just 10 years. Today there are more than 86 private cloud unicorns, including companies like HashiCorp, UiPath, Snowflake, Stripe, Toast, Procore, and more. While there were zero public cloud unicorns at the turn of the 21st century, public cloud companies with a $1 billion+ market capitalization gained significant velocity after 2007, as Netsuite went public in that same year and cloud adoption rates increased.
4 | State of the Cloud 2020 In 2010, there were 12 public unicorns, and in 2020, there are 54. Public cloud companies with more than $1 billion market cap include familiar tech giants like Salesforce, Paypal, ServiceNow, Shopify, and Adobe. From 2008 to 2020, the value of the top five public cloud companies increased by 44X.
5 | State of the Cloud 2020In 2008 the total market cap of Salesforce, Netsuite, Concur, Blackbaud, and Dealertrack totaled $13.89 billion. By 2015, the market cap increased by 8x with the addition of LinkedIn, ServiceNow, along with Salesforce and Netsuite, as the top fi...
