May 252016

On May 18th Bloomberg ran an article about Atlassian Software, whose sales last year topped $320 million and may reach $450 million this year, “without a single salesperson on the payroll.”

Here is the article: This $5 Billion Software Company Has No Sales Staff

This was not the first article out there on the topic and Atlassian. Others had also written about the company and its business model. An analyst also offers a cautionary note: “Though Atlassian counts more than half of the Fortune 500 as customers, no single customer accounts for more than 1% of revenue. In other words, no single client pays Atlassian more than $3.5M.” That suggests the company is hitting a ceiling in how much revenue it can derive from its customers.

This is not a rebuttal or an article that is designed to be contrarian. Like many other people I read the article with interest and appreciated a company whose product’s name, project management software Jira, is better known than the corporation behind it. Think Kleenex and Kimberly-Clark Worldwide, Inc. or Popsicles and Unilever. In today’s modern society, everyone and everything has to be justified and that includes sales professionals.

The article does note that the low sales (and marketing) expenditure came about accidentally when the company received an order off its fax machine. However, reading the article one could read into a little bit of a different story.

The company’s co-CEO states, customers “much rather be able to find the answers on the website.” That is, of course, much easier said than done. I am not referring to the power of search technology. I am referring to the power of finding, reading, understanding and not having any questions.

The company advertises. One expenditure cited is “mostly on ads.”

Another expenditure, and this is important so pay attention, is “payments to partners,” which is described as “one-fifth of that” presumably referring to the software firm’s revenue. Would it be wrong to assume partners exist to resell, the company has a channel as a model for leverage and scale and these partners have professional sales teams?

However, what was most interesting were the quotes from several executives like president Jay Simons who is quoted as saying, “lower prices and more investment in research and development to refine software, making it easier to try, understand, and purchase.” One cannot help, but notice that he, and others, are doing some selling here. He sounds like a good salesperson for his firm, doesn’t he? … Or is it just me?

What do you think?

*Things That Need To Go Away: Not Counting Public Relations, Media, Marketing Or Partners As Sales