So the #1 OG vertical SaaS leader is Veeva. A core CRM, data and Cloud platform for the life sciences industry, it started off as a “Salesforce for Pharma” and expanded from there.
It raised less than $10m before it IPO’d, and fast forward to day, it’s at $2.5 Billion in ARR, and is very profitable (almost $1B in non-GAAP net income), but growth has slowed to a mature 12%. Still, Wall Street is good with the combo. It trades at a stunning $32 Billion market cap.
5 Interesting Learnings:
#1. 1,432 Customers, But New Logo Count Has Slowed to Just +44 In Past Year
Veeva has won its primary markets, with 1,432 life sciences customers paying on average a stunning $1.75m a year each. But it does seem finally to have just run out of new enterprise customers to close. It’s net new logo count only grew 44 in the past twelve months, or just 3%.
#2. Almost 40% Non-GAAP Operating Margins
What Veeva now lacks in raw growth it truly makes up for in profitability. It has almost 40% non-GAAP operating margins and is on track to generate $1B+ of free cash flow in the coming year.
#3. Two Core Products, Each Doing Just Over $1B in ARR
Veeva has two core products today, each doing just over $1B in ARR (along with a lot of smaller sub-products). It’s rolling out new marketing and sales and data products for life sciences, but arguably a smidge late. Still, going multi-product has again been the key to scaling beyond $1B ARR.
#4. Looking to Do M&A With Their $4 Billion (!) In Cash
A good strategy today given their large cash position and strong ARR multiple.
#5. AI is Important — But LLMs Less So
AI in general has been part of the drug discovery for quite some time, but LLMs aren’t a magical solution to making Veeva even better
And our classic great deep dive with Founder CEO Peter Gassner here:
