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Helping people work more effectively.
confidential
SMB SaaS Applications - that Create Long-Term Revenue
Thomas Furr
CSO, Smart Online, Inc.
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Discussion Highlights• Why does Microsoft charge for application usage but not for
hosting and domain names?
• How do Hosting companies increase Average Revenue Per User (ARPU)?
• How do Hosting companies create a Long Term relationship with Customers?
High Growth Potential for Future Revenue
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Agenda
• Smart Online Snapshot
• Hosting Strategic Priorities�Compete with Microsoft OfficeLive�Increase Revenue Per User�Create Long Term Customers
• Summary & Conclusion
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What makes us unique
• Full suite of daily use applications and tools to start and operate a micro business (1 to 25 employees)
• Partnered with Parallels to enable hosting customers to rapidly launch micro business applications to their business customers
• Scalable multi-tenant infrastructure and business model that does not compete with hosting partners
• Ability to offer industry specific vertical solutions
• Low cost Software-as-a-Service (SaaS) solution
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Accounting
• General Ledger
• Accounts Payable/Receivable
• Electronic Invoicing
• Financial Statements
Productivity Tools
• Shared Group Calendar
• Contact Management
• Real-time Dashboards
• Customizable Reports
Sales & Customers (CRM/SFA)
• Sales Pipeline Tracking
• Sales Projections and Forecasting
• Customer Support
• Request Tracking
• Automated Customer
• Communication
Unique End-to-End ProductsBusiness Tools
• Business Plans
• Job Description
• Marketing Plans
• Legal Forms and Letters
Human Resources Management
• Employee Records
• Time Tracking
• Vacation Tracking
• PTO Requests
Websites and E-Commerce
• Website
• Order Management
• Distributor and Customer Management
• Sales Compensation
• Affiliate Integration
• Campaign Management
• Administration and Reports
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Unique End-to-End Products
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On-Demand Software-as-a-Service Statistics• International Data Corporation (IDC) forecasts that the on-demand
market will grow at a 32% compound annual rate to $14.8 billion by 2011
• IDC polled 612 small businesses (less than 100 employees) in 2007: 1.3% already used a SaaS solution, 5.1% were planning to use a SaaS solution within the next 12 months, 16.2% were interested in SaaS solutions, 41.2% indicated no interest in SaaS applications, and 36.2% did not know or had no opinion on the topic. We expect the “no interest” and “do not know/no opinion” categories will decrease over time as SaaS applications move into new markets and verticals.
• Access Markets International (AMI) Partners believes SaaS adoption is rising steadily in the United States among small (1-99 employees) and midsize businesses (100-999 employees). According to its estimates, 21% and 31% of respective small and midsize businesses use SaaS solutions, double the percentage of adoption in 2004.
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How do you compete with Microsoft OfficeLive?
• OfficeLive provides free hosting, email, and domain names
• OfficeLive charge for daily use applications
• Ways to Differentiate today:
�Leverage Parallels Application Packing Standard (APS) automation for rapid launch of new small business daily use applications
�Price bundles that package hosting, website, daily use applications for customers
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How do you increase Average Revenue Per User (ARPU)?
• Provide new offerings specific to Small Business needs
• Provide industry specific vertical Small Business solutions
• Hosting plus SaaS Small Business applications can increase ARPU substantially:
�According Parallels for customers with an average of 8 employees this number can increase from $20 per month to $180 per month
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How do you create long term customers?
• Provide low cost Small Business solutions that create efficiencies for your customers
• Get the Data in the Applications – Salesforce automation, accounting, human resource management
• Provide superior customer support
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Conclusions• Hosting companies can compete with Microsoft OfficeLive - today.
• Hosting companies can increase Average Revenue Per User (ARPU) - today.
• Hosting companies can create a Long Term Relationship with Customers – today.
Smart Online and Parallels Creating High Growth Potential for Future Revenue