Notes from salesforce.com, inc. 2003 S-1 IPO Filing

The largest and most successful SaaS/cloud company, salesforce.com, inc. (yes, that’s the proper spelling of the company), filed their S-1 for an IPO on December 18, 2003. With the annual Dreamforce conference next week, and the fact that their market cap is now $21.5 billion (NASDAQ: CRM), a little trip down memory lane to see how things were nine years ago is on tap.

Here are notes from the salesforce.com, inc. 2003 S-1 IPO filing:

  • Signed 8,000 paying subscribers from February 2000 to October 2003 and 110,000 seats (pg. 1) – SFDC now has over 110,000 paying subscribers and many millions of seats
  • May 2003 IDC reports project SaaS/cloud-based apps to be $2.6 billion in 2007 (pg. 1) – SFDC alone is going to be larger than $2.6 billion in revenue in 2013
  • Incorporated in Delaware in February 1999 and released first product in February 2000 (pg. 2)
  • Revenues (pg. 4)
    2001 – $5.4 million
    2002 – $22.2 million
    2003 – $50.9 million
    Nine months ended Oct 31, 2003 – $65.9 million
  • Losses (pg. 4)
    2001 – $33.6 million
    2002 – $30.1 million
    2003 – $9.3 million
  • Accumulated deficit – $71 million (pg. 4)
  • Small business customers have shorter contracts and higher rate of attrition (pg. 9)
  • Fiscal 2003 sales to Europe and Asia accounted for 14 and 17 percent of revenue, respectively (pg. 11)
  • Database software comes from Oracle Corporation (pg. 13)
  • Research and development expenses (pg. 23)
    2001  – $3.3 million
    2002 – $5.3 million
    2003 – $4.6 million
  • In December 2001 abandoned excess office space and took a $7.7 million charge (pg. 26)
  • Owned 64% of a Japanese joint venture (pg. 27)
  • Raised $61.1 million from investors in exchange for preferred stock (pg. 38)
  • $3.5 million letter of credit for office rent in 2001 (pg. 39)
  • 2004 office lease expense of $5.4 million (pg. 39)
  • 10,000 free Personal Edition users activated (pg. 47)
  • Application is written in Java and Oracle PL/SQL (pg. 48)
  • A small number of customers have service level agreements (pg. 50)
  • Field sales offices in more than 20 cities (pg. 51)
  • 412 employees as of Oct 31, 2003 (pg. 53)
  • Equity owned before IPO (pg. 72)
    Marc Benioff – 31.6%
    Halsey Minor – 10.2%
    Parker Harris – 2.7%
    Attractor Funds – 6.0%

Similar to the Workday IPO filing in the summer of 2012, this salesforce.com IPO filing from 2003 is highly unusual in that it’s a SaaS/cloud company that raised an impressive amount of capital and reached IPO-level recurring revenue in a short amount of time. Salesforce.com sets the standard for SaaS/cloud software companies and shows no signs of slowing down.

What else? What are some other thoughts on the salesforce.com 2003 S-1 IPO filing?

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.