Tuesday, 1 October 2019

MULTI-TENANT SAAS EXPLAINED

The software market historically has grown at the customer premises, with software hosted by the client or by third party hosting providers. 

As the internet, software and hosting infrastructure has evolved software is quickly migrating into the cloud.

Cloud software-as-a service can be either single tenanted and single instance software or multi-tenanted and single instance.   

Today most ASX listed software companies are essentially offering hybrid software combining hosted software with some single tenanted, single instance software-as-a-service (SaaS) technology functionality.  

The majority of enterprise software today was developed 20 years ago and designed for simple hosting environments in the client premises. 

In the last 10 years software has evolved rapidly with business looking to extract digital data from their business information in real time. Software design, data bases, technology stacks have come to the forefront with older software technology relegated in favour of technology which is able deliver timely digital data insights.

There are strong arguments while larger enterprises and heavily regulated industries demand single tenanted, single instance software-as-a-service. 

Smaller businesses and consumers are quickly accepting the benefits that multi-tenant, single instance software gives their business.

BENEFITS OF MULTI-TENANT SAAS

•                           Long term savings in software development
•                           Improved user experience
•                           Lower cost to maintain, upgrade and update technology
•                           Ease of customer on-boarding
•                           Better scaling of technology in timely fashion
•                           Better ability to support of software
•                           Better data insights in real time

Nano-cap / Micro-cap - Multi-tenant/Single-tenant, Single Instance SaaS names

•                           3pl
•                           Bigtincan
•                           Class
•                           Envirosuite
•                           Kyckr
•                           Vault
•                           Nearmap
•                           Readytech
•                           Urbanise
•                           Xref


We will explore valuation in these names in latter updates.




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