How Adobe increased revenue

Adobe’s path from $200 million to $5 billion in recurring revenue

In 2013 when Adobe launched Creative Cloud, the company broke with selling boxes and refocused on selling subscriptions (software as a service). At the time, the company had about $200 million in annual recurring revenue. Today, Adobe has over $5 billion in recurring revenue.

That’s important, because from an investor standpoint, recurring revenue is twice as valuable as non-recurring. This is something that doubles its enterprise value compared to a company that has to sell a new widget every month, quarter, or year. The reason is simple: Keep your customers happy, and the money keeps flowing in. No further sales efforts are required. The story of how Adobe managed to accomplish that has been told, but what did the company learn in the process?

Adobe SVP of go-to-market and sales Rob Giglio shared the lessons learned along the way at Imagine 2019, the company’s conference for its ecommerce platform Magento. “We moved from a very small percentage of our business being recurring to 90%,” Giglio said. “At the same time, we increased our revenue growth rate [from 11%] … to about 24% today.”

View More: https://venturebeat.com/2019/05/15/adobes-path-from-200-million-to-5-billion-in-recurring-revenue/