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Atlassian Idea Proposal

Atlassian Idea Proposal
 

Research Question: Will Atlassian’s software tools expand beyond software and IT development teams to become more entrenched in the whole enterprise?

Report Available: February 4, 2016

 

Blueshift’s initial research shows TEAM off to a flying start post-IPO. Word of mouth advertising has fueled30%+ growth rate for each of its products, driven especially by niche software developers. The company’s flagship tool, JIRA, looks to lever team workflows and minimize emailing, however some complained about JIRA’s customization deficiencies. TEAM’s next stage of growth to surpass lofty expectations depends on whether it can attract more users within the enterprise as it scales its business.

 

Observations

  1. TEAM’s recent IPO closed 32% higher than its opening price of $21. Some were surprised by its exceptional performance given TEAM stillgenerates most (73%) of its revenue from an on-premise licensing model in a market that has been rewarding companies that embrace cloud-subscription model. Just over 50% of TEAM’s revenue is derived from maintenance charges. TEAM’s tracking software JIRA and Confluence account for almost 66% of the company’s revenue.
  2. TEAM dreams big: It foresees “every employee inside of every company using Atlassian products every day” as the global workforce continues to rely less on email and more on messaging and workflow apps. TEAM differentiates itself by building professional teams, whereas competitor GitHub merely provides a consumer service. Unlike competitor FogCreek, TEAM allows public and open source accounts to utilize JIRA on open source projects, giving developers exposure to JIRA without demanding a trial period. TEAM excels at merchandising: its platforms automate suggested options and features for developers similar to how AMZN automates purchase suggestions. Because TEAM’s market has been predominantly software developers, it has not yet attracted many direct competitors, but will bump up against legacy vendors like MSFT and IBM as it scales.
  3. Unlike several other 2015 IPOs in the tech space, TEAM is already reporting positive earnings. But as it migrates more clients to the cloud and ramps up its salesforce to go after enterprise clients, earnings could be affected and TEAM will have to carefully manage its high expectations. Some question if TEAM will be able to significantly exceed its 30% growth rate as it markets to enterprise given its clientele has mainly been software developers. Also, JIRA does have some drawbacks as itlimits the ability to control configuration, restricts team adaptation, and is difficult to customize. Trello was cited as a bug tracking tool comparable to JIRA.

 

Will TEAM succeed in its vision to overtake email as the primary project management tool in companies across the globe? Can it expand within an enterprise and appeal to more than software and IT users? Or will it stay relegated to this niche for the time being? To gain insight into TEAM, Blueshift will gather data and issue a market research report from independent sources in the following areas: TEAM users, Non-TEAM users, Independent software developers, Competitors, and Industry specialists.

 

Companies: Atlassian (TEAM), Zendesk (ZEN), IBM (IBM), HP (HPQ), Oracle (ORCL), Microsoft (MSFT), Salesforce.com (CRM)