Salesforce vs. Hubspot

Salesforce generated roughly $176K in revenue per customer in 2022, compared to Hubspot's over $10K per customer. The companies both operate in the CRM space, but Salesforce follows a more skewed strategy toward more significant enterprise deals vs. Hubspot, which is focused on smaller deals. Financials Revenue Per Employees Revenue Breakdown Related Visual Stories Who Owns Salesforce Marc Benioff, Co-CEO of Salesforce is the main individual shareholder, with 3% of the company's stock. Other major individual shareholders comprise Parker Harris, Co-Founder, and Chief Technology Officer, and Bret Taylor, who is the company's CEO. Major institutional shareholders comprise The Vanguard Group, Fidelity, and BlackRock. Salesforce Business Model Salesforce follows a SaaS business model, offering four main categories of cloud CRM (Customer Relationship Management) services spanning the sales cloud to the marketing cloud. Where subscriptions drive the primary revenue model. However, the company leverages professional assistance to push the adoption of the software and retention of paying subscribers. Indeed, in 2023 Salesforce generated $29 billion from subscriptions and $2.33 billion from professional services. Salesforce Revenue In 2023 Salesforce generated $29 billion from subscriptions and $2.33 in professional services, compared to $24.66 billion in subscriptions in 2022 and $1.83 in professional services. Salesforce Employees Salesforce had 73,000 employees in 2022, compared to 56,000 employees in 2021, and 49,000 employees in 2020. Salesforce Marketing Expenses In 2023, Salesforce spent 43% of its total revenue on marketing and sales expenses, compared to 45% in 2022, and 45% in 2021. Salesforce Cost Structure Professional services are run at negative gross margins. In short, in 2022, on $2.33 billion in revenue from professional services, Salesforce reported a $208 million gross loss. In short, Salesforce runs professional services at a loss to boost its subscription revenue over time since professional services are used to enhance the use and retention of the software. The subscription revenue cost structure is quite effective. In 2022 on a $29 billion in subscription revenue, the company reported $5.82B in cost of revenue (expenses related to delivering the service and providing support, including the costs of data center capacity), thus generating a $23.2 billion in gross profits, in 2023. Salesforce Revenue Per Employee Salesforce generated $208 million in profits in 2023, compared to $1.44 billion in 2021, and over $4 billion in profits in 2020. Salesforce Competitors Salesforce is a cloud-based customer relationship management (CRM) provider, allowing businesses to build meaningful and sustained relationships with their customers. With robust, customizable software that integrates with social media, Gmail, and Microsoft Outlook, the Salesforce CRM platform is rated highly among businesses of all shapes and sizes. Recent data has shown that the company has captured 19.5% of the global CRM market. Salesforce Mission Statement Salesforce's mission is to build bridges between companies and customers. Salesforce does that via a SaaS platform, which is enhanced via professional services offered on top of it. Salesforce Acquisitions Salesforce was founded in 1999 by Marc Benioff, Frank Dominguez, Dave Moellenhoff, and Parker Harris. In a relatively short time, the corporate powerhouse of enterprise software has made numerous acquisitions as part of its broader growth strategy to become a SaaS giant! Hubspot Revenue Hubspot generated $1.73 billion in revenue in 2022, compared to $1.3 billion in revenue in 2021 and $883 million in 2020. In 2022, over 97% of Hubspot's revenue came from subscriptions, which generated $1.69 billion in revenue. Hubspot Net Losses Hubspot generated reported a net loss of $112 million in 2022, compared to a net loss of $77 million in 2021, and a net loss of $85 million in 2020. Hubspot Revenue Breakdown Hubspot generates most of its revenue from subscriptions. Indeed, in 2022 over 97% of its revenue came from subscriptions. In 2022, Hubspot generated $1.69 billion in revenue from subscriptions vs. $40 million from professional services. In 2021, Hubspot generated over $1.25 billion in revenue from subscriptions vs. $42 million from professional services. And in 2020, Hubspot generated $853 million in subscriptions and $30 million from professional services. Hubspot Subscription Business The subscription revenue cost structure is quite effective. In 2022 on a $1.69 billion in subscription revenue, the company reported $257 million in cost of revenue (expenses related to delivering the service and providing support, including the costs of data center capacity), thus generating a $1.43 billion in gross profits, in 2022. Hubspot Professional Services The professional service business is run to sustain the subscription business. Indeed, in 2022 on $40.4 million in subscription revenue, the company reported over $56 million in cost of revenue (expenses related to delivering the service and providing support, including the costs of data center capacity), thus generating a gross loss of over $16 million, in 2022. Hubspot Employees Hubspot had 7,433 employees in 2022, compared to 5,895 in 2021 and 4,225 in 2020. The company has grown from 2,638 employees in 2018 to 7,433 in 2022. Hubspot Revenue Per Employee Hubspot generated over $232K per employee in 2022, compared to over $220K in 2021 and $209K in 2020. Hubspot's revenue per employee grew from over $194K in 2018 to $232K by 2022. Hubspot Customers Hubspot had over 167K customers in 2022, compared to over 135K customers in 2021 and nearly 104K customers in 2020. The company grew from over 56K customers in 2018, to over 167K customers by 2022. Hubspot Revenue Per Customer Hubspot generated an average of over $11K of subscription revenue per customer in 2022, compared to over $10K in 2021 and over $9.5K in 2020. Hubspot Sales & Marketing vs. R&D In 2022, Hubspot spent 51% of its revenues in sales and marketing efforts, and 26% in R&D efforts, compared to 50% in sales and marketing efforts and 23% in R&D efforts in 2021.

Salesforce vs. Hubspot

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Gennaro Cuofano