San Diego’s ServiceNow Driving Hard as Revenue Soars; Expands to Silicon Valley
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the pedal quick enough or hard enough” before he took over. Hiring at high speed requires fortitude. “It’s like looking at the rear-view mirror,” Slootman says. “Objects are closer than they appear. We are sort of stepping on the pedal here.”
ServiceNow provides its IT management software, including help desk functions, in software-as-a-service style. By hosting the software on its own servers instead of installing it on a customer’s intranet, ServiceNow helps customers outsource their information technology and pay a flat monthly subscription fee.
The company now claims almost 800 enterprise customers, including San Diego-based Qualcomm; Milpitas, CA-based SanDisk; Troy, MI-based Delphi; Chelmsford, MA-based Kronos; Seattle, WA-based Real Networks; and Columbia University in the City of New York.
Revenue also has been accelerating for the venture-backed company, which has raised a total of $7.5 million from JMI Equity. ServiceNow says its annual recurring revenue passed $125 million in the fiscal year that just ended June 30, and its recurring revenue has more than doubled since June 30, 2010, when the company was at roughly $62 million in annual recurring revenue.
“It’s a record quarter by a mile,” Slootman says, “It’s by far the strongest quarter the company has experienced in its history.”
[Updated 8/9/11, 7:20 am to distinguish calendar year revenue.] When Luddy told me in January the company had generated $86 million in 2010, he was referring to ServiceNow revenue for the year that had just ended in December.
Despite the markets’ recent volatile gyrations, Slootman says the company also remains on course for an initial public offering. “We’re aiming to be IPO-ready after the first of the year,” he says. “That doesn’t mean we are going to go out. It just means we’ll be ready to go out.”
He also was unperturbed by the day’s market plunge. Regardless of the macro-economic trends, “The market is dying for companies like ServiceNow that are dynamic, growing, and fresh,” Slootman says. With revenue growing rapidly, there is no imperative for ServiceNow to raise capital by going public. “Our IPO will be a branding event and a liquidity event, rather than a fund-raising event,” Slootman says. “We’re not in a cash pinch.”