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About the Author:
Terry Kiwala
Vice President
Terry Kiwala is a vice president specializing in research and investment in software-as-a-service (SaaS) businesses, particularly in enterprise productivity applications. He is a thought leader in his sector, having authored widely read industry research. He uses his industry knowledge and expansive network to uncover promising investment opportunities and help companies navigate their strategic paths and accelerate growth. Prior to joining First Analysis in 2019, he was chief financial officer of Vokal, a software development company, senior vice president at Tribeca Flashpoint Media Arts Academy, and associate vice president at National-Louis University. Earlier, he was an investment banking analyst at Lehman Brothers. He earned a bachelor’s degree in economics and government from the University of Notre Dame. He is a CFA charterholder.
First Analysis Enterprise Productivity Technology Team
Terry Kiwala
Vice President
Corey Greendale
Managing Director
Richard Conklin
Managing Director
Matthew Nicklin
Managing Director
First Analysis Quarterly Insights
Enterprise productivity
SaaS for subscriptions has a pandemic tailwind
June 9, 2020
  • The subscription services sector — companies that provide software as a service enabling their clients to offer services (and increasingly products) under a subscription model — is among the fastest-growing enterprise productivity sectors.
  • This already rapid growth is being accelerated by COVID-19 as many companies and organizations have shifted to remote work and as consumers have avoided going out of their homes, prompting them to move further online across vast swaths of the economy, from entertainment to purchases of goods to social interaction to nearly every dimension of running a business.
  • We highlight companies and market subsegments poised to benefit from this unusual and powerful confluence of growth tailwinds. In particular, we discuss providers focused on the small- and medium-size enterprise segment and the growing trend of subscriptions for physical products.


Includes discussion of one public and 11 private companies

Subscription services is among the fastest-growing enterprise productivity sectors

COVID-19 will likely accelerate growth

COVID-19 makes subscription adoption especially critical for SMEs

Trend toward subscriptions for physical goods addressed by specialized subscription management platforms

Subscription management ecosystem likely to thrive

Sector resilience in the face of COVID-19 reflects strong SaaS fundamentals

M&A activity accelerating following 1Q20 slowdown

Subscription services sector well represented among recent private investments

Subscription services is among the fastest-growing enterprise productivity sectors

Among all subsectors we focus on within the enterprise productivity universe, subscription services is one of the fastest growing total addressable markets (TAM). These companies provide software-as-a-service (SaaS) platforms that enable businesses, large and small, to manage plans to deliver goods or services under subscriptions to businesses or consumers.

Expansion of subscription businesses is being fueled by a continuing shift in consumer preferences to own fewer assets and substitute monthly payments for lump-sum purchases. Further, businesses increasingly use SaaS subscription platforms to automate tasks and improve employee productivity. At the same time, the predictability and reliability of subscription revenue make switching to a subscription business model compelling for the providers of software, services and goods. The resulting rapid growth of subscription businesses has in turn fueled a dramatic rise in demand for the tools used to manage these subscription businesses.

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