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NetSuite CEO Evan Goldberg: Oracle ownership is symbiotic

Evan Goldberg, chief executive officer and founder of NetSuite, talks about the company’s narrative, from cloud applications pioneer to its acquisition by Oracle

Evan Goldberg, founder and chief executive officer of NetSuite, contends that the software-as-a-service company has amplified itself since being acquired by Oracle in 2016.

Arguably, the company did have “made at Oracle” stamped on it from the beginning. Oracle founder Larry Ellison was a major shareholder, and was a mentor to Goldberg.

He still is. Goldberg also confirms that Ellison is as funny in real life as he is on stage. “He has an amazing sense of humour,” he says. “A lot of very intelligent people do. He is self-deprecating, and he can see the absurdity in a lot of things.”

Goldberg says Ellison’s active involvement in all the technology aspects of Oracle might have come as surprise to some NetSuite employees, but not to him. “Very soon after the acquisition, Larry came and spoke to our entire R&D product development organisation,” he says. “He knew exactly what we did, how we did it, and what our value proposition was. He started the company – I think he gets it.”

Goldberg originally joined Oracle straight from Harvard in 1987 when it had about 900 employees.

NetSuite, which he founded in 1998, was previously a cloud applications firm called NetLedger. He recalls: “We started a few months before salesforce.com. We had a focus on a complete business management suite for small and growing, and mid-market companies. We moved up the ladder as we grew out the product, but we kept our eyes on that prize during the 18 years we were an independent company, getting close to $1bn in annual revenue.

“Oracle is investing very heavily in NetSuite – in R&D, but also in expanding internationally”

Evan Goldberg, NetSuite

“But then Oracle purchased NetSuite to complete their cloud portfolio for ERP [enterprise resource planning] and business management SaaS applications for big companies. They were not as focused on companies that were going from the garage to IPO [initial public offering], which has been our focus. But it was Larry’s vision to deliver – initially accounting – software over the web [in 1998]. We were always cousin companies, and for me it’s a coming back. I spent the first eight years of my career at Oracle.”

Here is an edited extract of an interview Goldberg did with Computer Weekly earlier this month.

How are things different for NetSuite as part of Oracle?

Goldberg: Oracle is investing very heavily in NetSuite. In R&D, but also in expanding internationally – the Nordics, Benelux, France – whereas previously, our international focus was very much UK. But that also benefits UK customers as they expand internationally, making sure NetSuite works, getting everything right for whichever locality, in terms of language, customs, tax, payment options, shipping, and so on.

It’s provided us with a level of focus we’ve not had in a long time. One of the first things that [Oracle CEO] Mark Hurd said after the acquisition was that NetSuite would exist in the market for ever.

And under the covers, we will be delivering a brand-new analytics engine, with real-time data, and that is the sort of thing we can now do. One of the reasons that I stayed was to see through some of these deep investments in the platform to make NetSuite more flexible, more verticalised, so that it is suitable for each individual business.

When you think of your market, is it very much small to medium, but fast-growing – as opposed to just SME?

Goldberg: One of the things we have done at Oracle is deliver SuiteSuccess editions. That’s how our customers buy NetSuite – it is more than just a software application, it is the entire process by which we introduce it into their lifecycle.

They might not be fast-growing, but typically they are businesses that are geographically distributed in several countries. I’d say it’s companies that have outgrown their initial financial application, whether that’s QuickBooks in the US or Sage in the UK, once their business has become more complex.

That’s why I started NetSuite in the first place, because I could see, from another startup, I didn’t have anything that could tie everything together in the company and enable me to see everything going on in my business in a dashboard.

But, for example, American Express spun off its business travel company GBT [Global Business Travel] and that runs on NetSuite. We do have companies that have grown up with us from hundreds of millions of dollars to a billion plus. Now there may be companies where complexity goes to such a degree that Oracle cloud application is a logical destination, but is quite rare. We have been able to scale.

In the context of a more general shift to the cloud, what do you see as NetSuite’s enduring value proposition?

Goldberg: Initially, we were selling the anytime, anywhere aspect of the cloud – although it wasn’t called the cloud then; it was ASP [application service provider] or web applications. And initially we ran into resistance. You had [Salesforce CEO] Marc Benioff selling software-as-a-service sales people. But finance people are by nature more conservative, and we had to say to them: “You are reluctant to put your finance information in the cloud, yet your sales contact information is there.” And I can’t deny Salesforce.com’s hype created a wave for us.

But you’re right. The whole narrative has flipped. Now, it’s “why would I want my information to be on my computers?”. So it has to be about more than just the cloud for us. What we have come back to is the other key component of our strategy, which is to deliver a single application across not just financial, not just ERP, but commerce, and HR, with SuitePeople.

The ultimate promise is all of your information in one place, with a single UI for all your users. That is what we’re hanging our hat on, and for a variety of businesses. We have amazing charities using us, like Compassion in World Farming in the UK. These fast-growing charities need the same visibility into their business as for-profit companies.

What are the benefits of Oracle’s autonomous database and cloud drive for NetSuite, given that your customers won’t be employing lots of DBAs [database administrators] anyway?

Goldberg: We are moving NetSuite to the Oracle Cloud Infrastructure (OCI). For instance, we will be delivering to German customers from a German datacentre over the OCI. And the Oracle Cloud Infrastructure promise is the same benefits for us as any other business. We can focus on delivering our service and let them look after the nuts and bolts of the infrastructure, and how it gets on to the internet.

How do you see the mid-market enterprise applications market changing? SAP has made a massive turn to the customer with C/4 Hana, Microsoft Dynamics is a serious player, you have Infor continuing to develop in the cloud, and Anaplan with financial planning in the cloud. What’s your read?

Goldberg: You know, it has been pretty static in our market segment. No decision is our biggest competition. We don’t see SAP, Microsoft has been very slow to develop cloud-based versions of mid-market applications. So it’s a green field with a smorgasbord of local solutions internationally, and we are delivering something this uniform around the world.

Read more about small to mid-market business applications

This was last published in January 2019

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