Salesforce Ventures Cement their Presence in the Cloud with SaaS ERP: If a company can raise venture capital to the tune of $110 million, like FinancialForce has been able to do, one can expect them to be providing a game-changing product, right?
A cursory glance at FinancialForce (FF) ERP may lead one to brush it aside as hardly ground-breaking. FF is an enterprise resource planning (ERP) solution designed to operate within Salesforce.com’s cloud platform using their related products like Salesforce ANT migration tools – hardly anyone’s idea of cutting edge technology.
But, closer examination of the new product would show that ERP software-as-a-service (SaaS) solutions are maturing in the market, especially directed at the larger and higher-end customers looking for enterprise solutions, after many years of staying in the shadows.
The $110 million raised in venture capital does not include $50 million, which FinancialForce raised last year when Salesforce Ventures was a major investing firm. This is to be expected as FinancialForce is Salesforce’s joint venture, founded in 2009. Hence, when opportunity arises to make a case for using the Salesforce platform, they would certainly welcome it with open arms.
Why introduce a SaaS ERP at all, and why do so now?
The arguments for a SaaS ERP are no different from arguments raised in favor of SaaS in itself. The costs associated with entry as well as the costs of ownership are much more predictable and less burdensome than costs associated with on-premise ERPs. What’s more, enterprises using cloud-based ERP do not have to concern themselves with matters of platform management.
All factors considered, SaaS ERPs tend to be more agile and cheaper than on-premise systems. Many of the major SaaS ERP vendors have taken towards inclusion of analytical and data visualization features within the SaaS ERP package rather than having it as a separate cost-plus extension option.
However, the main reason businesses are yet to embrace SaaS ERPs has little to do with the general reticence surrounding anything ‘cloud-based’. Rather, the reason is that these ERPs aren’t providing what these businesses really need.
As at last year, on-premise ERPs offered better service for the bigger companies in the finance and manufacturing lines of business. Smaller firms would make the switch faster and sooner than larger enterprises, but on the whole, it could take up to a decade before a majority of businesses are using cloud ERPs.
FinancialForce has included professional services automation and accounting as its two biggest attractions, and is backed by the able platform of one of its parent companies, Salesforce. This enables it to offer programmability and agility that will be useful to offer both big and small solutions according to the customizable and robust nature of its supporting platform.
At present, FinancialForce is providing useful solutions to many of the customers who are relying on cloud-based ERPs, most often subsidiaries and subdivisions of the real big companies. It sounds like the traditional two-tiered deployment system, but if it does get FF through the door and on the way to offering the all-inclusive ERP solutions needed by all organizations, it is well worth a try.