Aug
19
2020
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A pandemic and recession won’t stop Atlassian’s SaaS push

No company is completely insulated from the macroeconomic fallout of COVID-19, but we are seeing some companies fare better than others, especially those providing ways to collaborate online. Count Atlassian in that camp, as it provides a suite of tools focused on working smarter in a digital context.

At a time when many employees are working from home, Atlassian’s product approach sounds like a recipe for a smash hit. But in its latest earnings report, the company detailed slowing growth, not the acceleration we might expect. Looking ahead, it’s predicting more of the same — at least for the short term.

Part of the reason for that — beyond some small-business customers, hit by hard times, moving to its new free tier introduced last March — is the pain associated with moving customers off of older license revenue to more predictable subscription revenue. The company has shown that it is willing to sacrifice short-term growth to accelerate that transition.

We sat down with Atlassian CRO Cameron Deatsch to talk about some of the challenges his company is facing as it navigates through these crazy times. Deatsch pointed out that in spite of the turbulence, and the push to subscriptions, Atlassian is well-positioned with plenty of cash on hand and the ability to make strategic acquisitions when needed, while continuing to expand the recurring-revenue slice of its revenue pie.

The COVID-19 effect

Deatsch told us that Atlassian could not fully escape the pandemic’s impact on business, especially in April and May when many companies felt it. His company saw the biggest impact from smaller businesses, which cut back, moved to a free tier, or in some cases closed their doors. There was no getting away from the market chop that SMBs took during the early stages of COVID, and he said it had an impact on Atlassian’s new customer numbers.

Atlassian Q4FY2020 customer growth graph

Image Credits: Atlassian

Still, the company believes it will recover from the slow down in new customers, especially as it begins to convert a percentage of its new, free-tier users to paid users down the road. For this quarter it only translated into around 3000 new customers, but Deatsch didn’t seem concerned. “The customer numbers were off, but the overall financials were pretty strong coming out of [fiscal] Q4 if you looked at it. But also the number of people who are trying our products now because of the free tier is way up. We saw a step change when we launched free,” he said.

Jul
30
2020
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Atlassian acquires asset management company Mindville

Atlassian today announced that it has acquired Mindville, a Jira-centric enterprise asset management firm based in Sweden. Mindville’s more than 1,700 customers include the likes of NASA, Spotify and Samsung.

Image Credits: Atlassian

With this acquisition, Atlassian is getting into a new market, too, by adding asset management tools to its lineup of services. The company’s flagship product is Mindville Insights, which helps IT, HR, sales, legal and facilities to track assets across a company. It’s completely agnostic as to which assets you are tracking, though, given Atlassian’s user base, most companies will likely use it to track IT assets like servers and laptops. But in addition to physical assets, you also can use the service to automatically import cloud-based servers from AWS, Azure and GCP, for example, and the team has built connectors to services like Service Now and Snow Software, too.

Image Credits: Mindville

“Mindville Insight provides enterprises with full visibility into their assets and services, critical to delivering great customer and employee service experiences. These capabilities are a cornerstone of IT Service Management (ITSM), a market where Atlassian continues to see strong momentum and growth,” Atlassian’s head of tech teams Noah Wasmer writes in today’s announcement.

Co-founded by Tommy Nordahl and Mathias Edblom, Mindville never raised any institutional funding, according to Crunchbase. The two companies also didn’t disclose the acquisition price.

Like some of Atlassian’s other recent acquisitions, including Code Barrel, the company was already an Atlassian partner and successfully selling its service in the Atlassian Marketplace.

“This acquisition builds on Atlassian’s investment in [IT Service Management], including recent acquisitions like Opsgenie for incident management, Automation for Jira for code-free automation, and Halp for conversational ticketing,” Atlassian’s Wasmer writes.

The Mindville team says it will continue to support existing customers and that Atlassian will continue to build on Insight’s tools while it works to integrate them with Jira Service Desk. That integration, Atlassian argues, will give its users more visibility into their assets and allow them to deliver better customer and employee service experiences.

Image Credits: Mindville

“We’ve watched the Insight product line be used heavily in many industries and for various disciplines, including some we never expected! One of the most popular areas is IT Service Management where Insight plays an important role connecting all relevant asset data to incidents, changes, problems, and requests,” write Mindville’s founders in today’s announcement. “Combining our solutions with the products from Atlassian enables tighter integration for more sophisticated service management, empowered by the underlying asset data.”

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