Building an Ambitious SaaS Company: Taleo CEO Michael Gregoire (Part 11)

SM: Which international markets are you seeing adoption in? MG: We are probably the number 1 provider in Australia and New Zealand. We are in the top 3 in France and the top 5 in the UK. Momentum everywhere is going up.

From a revenue perspective, we grew revenue by 32% to $128M. In applications revenue, we even grew faster at 33%. Services revenue grew 28%. We ended up with 1500 customers world wide. We had a great profit signature for the year. We posted a $13.5M in non-gaap net operating income, that is a 366% increase in non-gap net income. That is a big part of our story. We are the most profitable on demand software company, and we have done that by choice.

SM: When you say services that can be confusing because you are a service company. What is the distinction that you make between a product and a service? MG: We tell you exactly how much revenue we get for ASP, and we tell you exactly how much we get from consulting and training. We break those out. Some SaaS companies cloud that because they are more of a consulting company rather than a software company, and we have got a lot of credit from the street for being very straight forward and breaking out the revenues, so people understand exactly how our business mix comes together.

SM: What are the key metrics you track and how are they doing? MG: We track net new customers. We had a great year and a great quarter. In Q3 we had 17 net new enterprise customers, and a total of 78 for the year. We ended with 323 customers overall. We also tell the street how many deals have greater than $250,000 revenue per year, and we had 8 of those. We also track the Taleo Business Edition (TBE) customers, so we added 166 new TBE customers for a total of 657 for the year and 1200 in total.

SM: What about churn? MG: In our business we have wonderful customer satisfaction. We have over 95% renewals.

SM: This new product you are bringing to the market, the performance management product, is that entirely up-sell into the existing customer base? MG: Absolutely it can up-sell. We are going to sell it stand alone in the second quarter as well.

This segment is part 11 in the series : Building an Ambitious SaaS Company: Taleo CEO Michael Gregoire
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