BY PATRICK HOGE San Francisco Business Times

S alesforce.com is making space on its cloud.The online “software-as-a-service” juggernaut is

having exceptional success renting its technolo-gy infrastructure to hundreds of other companies,

often to sell online applications to Salesforce customers and increasingly to build entire companies that sell online prod-ucts to non-Salesforce customers as well.

At least a half-dozen young firms that run core operations on Salesforce’s technology, including one that now has more than $100 million in revenue, are thriving in and around San Francisco, while hundreds of others are sprouting in other parts of the country and internationally as well. Executives at these companies say they have been able to develop rich-er offerings with less investment and grow far more quickly than if they did not have access to Salesforce’s platform, which was launched in 2007 and is called Force.com. Their products are also automatically capable of being integrated with one another.

Salesforce, meanwhile, gets an undisclosed amount of rev-enue from its partners and also benefits because its custom-ers have access to a wide array of applications that extend the functionality of Salesforce’s products.

“It proves that the Salesforce platform is real,” said Mike Rosenbaum, senior vice president in charge of Force.com and Salesforce’s AppExchange, the pioneering online store for third party applications that Salesforce launched in 2006, even before Apple Inc. launched its hugely successful App Store. There are about 1,500 applications for sale on the App Exchange. “We are in the midst of a significant shift to cloud, social, mobile computing. We provide a platform and marketplace that accelerates that,” he said.

Early daysDave Yarnold, CEO of Pleasanton-based ServiceMax, a

provider of mobile field service applications that has run on Force.com since 2007, thinks the day is not far off when it will be the norm for companies to start and stay on plat-forms like Salesforce’s.

“I think it’s really early days,” Yarnold said. “I think we’re going to get to a point where you’ll be a fool to start an app company and not build on a platform like Salesforce.”

ServiceMax is currently on a $10 million to $20 million annual run rate, with growth last year of 188 percent. It has raised $26 million, some of it from Salesforce with other investors including Trinity Ventures, Emergence Capital Partners and Mayfield Fund.

The company employs 130 people and Yarnold plans to hire at least 50 more over the coming year, with the biggest chunk of those in Pleasanton, he said.

“We’re still a small company, but it’s not going to be that way forever,” said Yarnold, who previously ran global sales

at SuccessFactors, where he was an early employee. That company went public and then was bought by SAP last year for $3.4 billion.

Elizabeth Herbert, an analyst with Forrester Research, said that powering separate companies on a cloud technol-ogy platform like Salesforce’s is not an easy feat, and com-petitors have been cautious about allowing partners to ride on their systems.

Christine Dover, an IDC analyst, said competitors are lining up to offer similar backend services for cloud com-panies, with Microsoft, IBM, Oracle and SAP among those vying for market share, but Salesforce remains out front for now, Dover said.

“It’s exciting for the San Francisco Bay Area,” said Dover. “These are the companies that are going to be hiring — hir-ing locally and hiring lots of people.”

One of the earliest to jump wholly onto Force.com was Pleasanton-based Veeva, a customer relationship manage-ment software provider launched in 2007 that has rocketed to prominence and is now the leading vendor to the U.S. pharmaceutical industry. The company has half of the nation’s roughly 80,000 sales representatives using its tools. Oracle still leads globally, but IDC says Veeva may take that spot if trends continue.

This year, Veeva will do “well over $100 million in rev-enue,” up from $55 million last year, and it is profitable, said co-founder and Chief Strategy Officer Matt Wallach, who talked of possibly going public in a few years. And Veeva took only $4 million in equity funding in June 2008 from Emergence Capital Partners, he said.

“We are hugely capital efficient,” Wallach said. “We hope to be on Force.com indefinitely.”

The company has just over 300 employees, including about 120 at its Pleasanton headquarters, about 110 abroad and the rest around the United States.

Plans call for hiring 300 in the next year, with up to half of those in Pleasanton, Wallach said. Veeva has offices in Philadelphia, Barcelona, Paris, Beijing, Shanghai and Tokyo.

Like others, Wallach said that developing on Force.com has saved his company millions of dollars that otherwise would been spent developing its own technology.

Take ChikPea, a 20-person San Francisco company founded in 2006 that sells a Force.com-based order management prod-uct for mid- to large-sized telecommunications companies.

ChikPea has been self-financed and profitable almost since the beginning, something that would not have been possible without Force.com, said marketing director Adam Kleinberg. “We can do a lot more in a very efficient manner in the Salesforce environment,” Kleinberg said. “I do owe a lot to the Force.com platform.”

Piggyback on improvementsIn addition, companies like ChikPea get the benefit of

improvements and features that Salesforce produces — like

its social networking tool Chatter — as well as the increased credibility that comes with having Salesforce on the back end.

“Every now and then it’s like Christmas,” Yarnold said. “One day we had Chatter (Salesforce’s social networking ser-vice). We didn’t have to do anything. It was there.”

As a result, field workers for companies like Pitney Bowes can now collaborate in real-time using ServiceMax’s custom-ized Chatter-based tools, even with video, to fix problems with equipment in customers’ offices, Yarnold said.

For San Francisco-based Jobscience, getting on Force.com lit its business on fire.

The company started a decade ago as a job board for the health care industry, and after the bursting of the Internet bubble largely limped along as a tracking tool for hiring until several years ago when it rebuilt itself on Force.com.

The move, which seemed potentially risky at the time, proved fruitful, and the company has seen revenue go from $2.5 million to a run rate of more than $10 million, with cus-tomers rising from 100 to 400 companies, and the types of industries broadening significantly. Employee headcount has risen from 20 to 50.

“It turned out to be a good bet,” said CEO Ted Elliott.Expectations are also high for Kenandy Inc., a Redwood

City startup on Force.com that aims to provide resource planning software for the manufacturing sector and which raised a $10.5 million Series A round of funding led by Kleiner Perkins Caufield & Byers and Salesforce.com, among others.

The company was founded in 2010 by Sandra Kurtzig, a well-known Silicon Valley veteran who previously made for-tunes with other software companies.

Not limited to customersAn interesting aspect of Salesforce’s approach is that the

company does not require that companies riding its tech-nology sell only to Salesforce customers, as does NetSuite, a cloud computing provider in San Mateo.

An example is San Francisco-based FinancialForce.com Inc., a maker of cloud applications for functions including accounting, billing, professional services automation and services resource planning. It launched in 2009 with minor-ity backing from Salesforce and the Dutch firm Unit4 hold-ing a majority.

The company was on a $9 million annual run rate in December, and president and CEO Jeremy Roche said it’s been growing since then. With staff in the United States, Britain and Spain, it employs 130 people and Roche has plans to hire roughly 100 people in the next year.

“Increasingly now, we sell to customers who are not customers of Salesforce,” Roche said. “Some of our largest customers will probably never be customers of Salesforce.”

phoge@bizjournals.com / (415) 288-4949 �

SF BUSINESS TIMES | JULY 6-12, 2012 sanfranciscobusinesstimes.com THE NEWS 1

Companies fl oat high on Salesforce technology

Cloud rains startups

“It turned out to be a good bet,” says Jobscience CEO Ted Elliott.

HOPPING ONThe Saleforce platform offers features and heft to smaller companies.

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Jeremy Roche, FinancialForce: Not just selling to Salesforce customers.

Dave Yarnold, ServiceMax:

“Every now and then it’s like Christmas.”

“We hope to be on Force.com indefinitely,” says Veeva’s Matt Wallach.

5

March 2, 2012

SPencer Brown

Shema’s legal career at Onyx is balance of science, lawby Emily WilSOn

Suzanne Shema may hold the title of general coun-sel at Onyx Pharmaceuticals Inc., but she sees her role as more than just a lawyer. She approaches ev-ery legal issue as a scientist, a business person and even a healer.

Her multiple skills help the South San Francisco-based drug company achieve its mission to transform the lives of cancer patients and how the disease is treated, said CEO Dr. Tony Coles.

“She has impacted our business dramatically,” Coles said. “She can speak on both legal and business matters, and we all appreciate a fresh perspective. Also she never gives up, which is really important in a business such as ours. There’s a lot of risk in the

science of what we do, but because of our mission, we can never give up.”

Coles saw this played out in the way Shema dealt with Onyx’s years-long lawsuit with Bayer Health-Care Pharmaceuticals Inc. — something she had to take on right after joining the company in 2009. Shema had to settle the lawsuit and at the same time, work on the Onyx partnership with Bayer to promote the drug, Nexavar, an oral treatment for liver and kidney cancer — a delicate situation, to say the least.

Advocating for Onyx’s legal interests while foster-ing the relationship between the two companies is one of the things Shema feels proudest of about her time at Onyx.

“It sounds weird, but I wanted to roll up my sleeves and work on it,” she said. “I wanted to understand the litigation and how to protect the company’s rights. I didn’t want to destroy — I wanted to heal.”

Another tricky situation that Shema negotiated was the company’s acquisition of Proteolix in 2009. Shema’s team played a big role in the company’s ef-forts to bring the drug Carfilzomib to patients with plasma cell cancer, pending the Food and Drug Ad-ministration’s approval of the drug. Shema’s legal team worked on agreements related to drug supplies, clinical trials and distribution.

“I was excited to take what we had started to the next level,” Shema said. “Working on the acquisition gave us an opportunity to integrate the two compa-nies, and we’ve done that. Onyx has benefited from

what Proteolix brought to us.”Shema’s love of science comes from her experience

at a Catholic all-girls high school where she didn’t have to worry about “saying anything silly about science in front of boys.” The nuns encouraged her interest, and she ended up getting a master’s degree in chemistry from the University of Washington, as well as a law degree from the same school.

Being general counsel at Onyx lets her use her law and science background, Shema said, and it also challenges her every day. For her, the job at Onyx all comes down to balance.

“You can’t be just a lawyer,” she said. “You have to care about the business, too. You are pushed and pulled left and right, and you have to help the compa-ny stay on track, which is always exciting and always challenging.”

It’s the ability to look at all sides of things that makes Shema stand out, Coles said.

“What distinguishes Suzanne is her passion and compassion,” he said. “She balances both the techni-cal perspective with what’s right and fair. She looks at both sides of any issue and strives to see the other point of view and without judgment find a solution.”

Something about Shema that would surprise others? She’s incredibly adventurous.

“I have jumped out of a perfectly good airplane several times and have climbed ice cliffs with ice axes and crampons, which turns out to be good training for litigation — have good tools, take one step at a time and try not to look down.”

Best General CounselPublic – Small

WinnEr

Suzanne ShemaOnyx Pharmaceuticals inc.

Executive Vice President and General Counsel

*5•corpcouns-pubCo-sm.indd 5 3/6/12 12:50 PM