SERVICE-NOW.COM
Founder and CEO: Fred Luddy.
Founded: 2004.
First paying customer: 2005.
Revenues: $53 million annually.
No. of local employees: 95.
Investors: JMI Equity and Sequoia Capital.
Company description: Provider of IT service management in the form of a Web-based software program that is available to subscribers.
Development of information technology in a large company can be tough enough without the extra hassle of setting up special equipment and computer programs.
So Fred Luddy, Service-now.com chief executive officer and founder, set out to develop a software package that would manage a company’s IT system without the added expense and time needed to install and maintain extra equipment.
Based in Solana Beach, Service-now.com provides its software online by subscription. “It is all done on a Web basis with nothing to install,” said Service-now.com spokesman Rhett Glauser. “It keeps all records of all assets.”
Providing a program that is accessed by computer is called “software as a service,” abbreviated SaaS. It provides a platform to tackle service management challenges that had previously been considered as too complex to realistically address with software.
The SaaS market has grown significantly and so has Service-now.com.
Luddy began with about a dozen nonpaying customers. Now he has more than 400 subscribers. Companies that subscribe to Service-now.com pay $100 per IT user per month.
Once connected, the program makes it possible to convert, store, protect, process, transmit and securely retrieve information. Besides making setup a snap, Luddy wanted to provide a time-saving service program that is easy for IT staff and end users to master. And it is geared to large companies with complex infrastructure.
Luddy believes that effective IT service management requires a process with as much automation as possible, while remaining flexible to each company’s business requirements, reporting and work flow needs.
High Degree of Integration
Service-now.com’s software utilizes a highly integrated configuration management database. The database allows the software to track information and configure it in a single system of reference for all IT processes. The system helps IT staff gain visibility into how their work interacts and depends on others in seemingly different and unrelated areas.
Luddy insists that a database offers little value if it isn’t highly integrated to the processes it supports. Specifically, the Service-now.com system focuses on managing incoming requests, problems and errors in the information system, relationships of infrastructure including supporting business services and information, and the hardware and software database.
Fast Growth
Service-now.com’s customers include Google, Facebook, Qualcomm Inc., PetSmart Inc., Metropolitan Life Insurance Co., Staples Inc., H&R Block Inc., Johnson & Johnson, Sony Pictures Entertainment Inc. and Santander Consumer USA Inc.
Kimberly Rogers, Santander consumer USA IT service delivery and IT change manager, reports time savings with the Service-now.com IT management system. “What used to take a service desk pro 10 minutes, now takes two minutes,” Rogers said. “When applied to an average volume of 1,200 incidents per day and about 370 changes per month, this increased efficiency really adds up.”
In the first quarter of 2010, Service-now.com added 49 new customers with a dozen Fortune 1000 accounts. And the company, which currently earns $53 million in annual net income, reports to be ahead of a plan to more than double recurring revenue year over year.
Two investors, JMI Equity, with offices in Baltimore and San Diego, and Sequoia Capital of Menlo Park helped get Service-now.com rolling. JMI invested $2.5 million in series A stock in 2005 and $5 million in series B stock in 2006.
Sequoia Capital offered to purchase $63 million in employee shares last year with proceeds going to the employees.
Service-now.com’s 400-plus subscribing companies translates to about 100,000 IT professionals using the service. Besides Solana Beach, Service-now.com has offices in New York and London.
In total, Service-now.com has 175 employees, with about 95 employees in the Solana Beach office.
