SerivceNow’s long-standing CEO Frank Slootman will be stepping down from his role as chief executive, and is set to be replaced by ex-eBay chief John Donahoe at the beginning of April.
Donahoe has been brought in to help ServiceNow, which is one of the fastest growing enterprise cloud platforms in the market, and one of the largest in terms of annual revenues, through its next stage of growth and expansion.
Donahoe was chief executive of eBay between 2008 and 2015, during which time revenues more than doubled to $18 billion and the company’s market value increased 250% to $80 billion. Success that ServiceNow will no doubt be hoping to replicate.
Commenting on the appointment, Donahoe said:
I am honored to lead ServiceNow. Frank has done a tremendous job building the company into the fastest growing enterprise software company in the world. ServiceNow is extremely well positioned to expand its leadership in the years ahead.
Working alongside Frank and the Board, the management team and I intend to capitalize on our opportunities to drive growth and create value for our customers, partners, shareholders and employees.
Slootman, who has been CEO of ServiceNow for six years, and has been responsible for significant growth at the company, will continue as Chairman upon stepping down from his management role.
Mr. Slootman said:
It has been a privilege to lead ServiceNow as CEO for the past six years – I am proud of our talented team and all that we have achieved together. With a strong global network of customers and partners, expansive offering of cloud‑based enterprise services, and over $1 billion in revenue, I am confident that we are making this transition from a position of strength.
I look forward to continuing to serve as Chairman and supporting John as he takes the Company into its next phase of growth and success.
You only have to take a quick look at ServiceNow’s most recent results to get an indication of how important this company is becoming in the enterprise cloud market. In the fourth quarter, subscription billings rose 52% year-on-year to $483.9 million.
During that same quarter, the firm also clocked up a record 27 new deals greater than $1 million in new new annualized contract value. Perhaps more notably, 18 of the top 20 new deals in Q4 last year involved more than three of ServiceNow’s products.
This is a trajectory that the company has been on for a number of years now. As the company has continued to expand its product portfolio across a number of verticals, it is increasingly being bought into by enterprises as a core platform to ‘servitize’ the business.
ServiceNow indicated during its most recent results that it was going to be targeting global expansion during 2017. It is also looking to increase its branding and marketing endeavours, as it is arguable that it has less of a presence in the market compared to the likes of Salesforce and Workday.
Donahoe’s appointment marks a turning point for ServiceNow. Donahoe’s tenure will be decided by the rate at which he can scale the company and further embed the platform into the enterprise. Will Donahoe pursue an exit strategy for ServiceNow? Will we see further consolidation in the cloud market? I’m not convinced. I get the impression ServiceNow is gearing up to go at it alone and attempt to become the new cloud core for service-orientated enterprises.
However, scaling up in an increasingly competitive market isn't going to be easy - this is by no means game over, particularly with others watching with interest at how enterprises are buying into the idea of 'service'.