Weekly insights on great companies operating within the SaaS space.
For readers that don’t quite understand exactly what SaaS is, it is a software distribution model in which a third-party provider hosts applications and makes them available to customers over the Internet. SaaS is one of three main categories of cloud computing, alongside infrastructure as a service and platform as a service ( IaaS and PaaS ).
Ok, that seems to make sense, but how would you describe SaaS to your grandmother? SaaS, is just software that you don’t have to install on your machine or manually update. The user for SaaS can be anyone! SaaS is usually charged on a subscription model, rather than a one time license fee.
A great metaphor would be using a car:
- IaaS = Leasing a car, the most complex of the three and you decide the specs and cover all the additional costs that come with it.
- PaaS = Renting a car, indifferent to the specifics like color and options, but still cover all the costs of using.
- SaaS = Taxi/Uber, you don’t care about the specifics like color and options, and you don’t cover the costs as it is all baked into the price of the service.
We all love and use SaaS companies frequently. Some of the great benefits:
- Client Independence — All the services including data, middleware, servers, and storage, etc. are managed by the vendor giving clients peace of mind & the independence.
- Subscription model — You only pay for the services that you want & for how long without any commitment for either.
- Automatic updates — Since the software is hosted on remote servers elsewhere, updates are automatically pushed to the client’s machines without the need for the extra effort.
- Location independence — As the software is Cloud-based it can be accessed from anywhere on any device without the need to worry about installing it wherever you go.
- No Overhead costs — The services are available on-demand, therefore, there are no costs associated with packaging & distribution, etc.
- Limit Piracy — Again the non-availability of the software on any hardware medium restricts the unauthorized use or the piracy of the service.
The cloud is a blessing for many reasons. Life wouldn’t be the same without these cloud based services that we so frequently use.
With all that being said, let’s dive into some of the top SaaS companies that are making waves this week!
EMQ Technologies receives $21.7 million in funding from Hillhouse Capital Group, Vision Knight Capital, Oriental Fortune Capital, and GGV Capital. EMQ Technologies is an open-source software company providing highly-scalable, real-time messaging and streaming engines for IoT platforms and applications in the 5G era.
DXY receives $500 million in funding from Trustbridge Partners, Tencent Holdings, and GL Ventures. DXY is an online healthcare community for doctors, consumers, and healthcare organizations that specializes in pharmaceuticals and life sciences to provide communication software and tools of various forms to improve users’ productivity.
Color receives $167 million in funding from General Catalyst, T. Rowe Price, and Viking Global Investors. Color is a population health technology company that enables the delivery of advanced healthcare through clinical genetics.
IsoPlexis receives $85 million in funding from Northpond Ventures. IsoPlexis is a life sciences company developing a cellular response analysis platform that identifies a wide range of patient immune responses at the single-cell level.
23andMe receives $82.5 million in funding from Sequoia Capital and NewView Capital. 23andMe is a DNA testing technology company that enables its users to access their ancestry, genealogy, and inherited traits.
Additional Companies to Watch
The SaaS space continues to heat up as more investor dollars are put to work in the space. Each week I’ll be sure to track major funding events and share insights on my top picks for that week!