AI remains a Wild West, while hyperscalers continue their gravitational pull and demand for industry expertise grows
Tercera, an investment firm supporting growth-stage IT professional services firms, today unveiled the 2024 Tercera 30, its annual list of the top software ecosystems for services partners. The Tercera 30 gives founders and IT services leaders valuable insights into the software platforms that hold the greatest potential for building a channel-focused technology services business.
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The third annual report profiles 30 software vendors that rely on consultancies, systems integrators and managed service providers to drive growth. It includes:
— 10 of the largest publicly-traded vendors (Market Anchors)
— 10 publicly-traded vendors with evolving partner ecosystems (Market Movers)
— 10 privately-held, partner-centric vendors that are gaining share (Market Challengers)
— A bonus 5 Ones to Watch list focused on industry players
The full report and listing of the Tercera 30 can be found here.
“Ecosystem-focused services companies have had a wild ride over the last two years,” said Chris Barbin, CEO of Tercera. “Some vendors have overperformed and leaned into partners, where others have pulled back. We created the Tercera 30 to serve as a resource for services leaders to make better-informed decisions about the partners they bet on. Because not every partner ecosystem is created equal.”
Who’s in and who’s outSeven companies on the 2024 Tercera 30 are new to the list. They include: Anthropic, Braze, Cohesity, Dynatrace, MongoDB, Wiz and Zscaler. These additions are the result of not only their individual market and partner performance, but also the growing momentum for AI, data management and cybersecurity.
Hyperscalers continue their gravitational pullThe three largest public cloud providers— Amazon Web Services, Microsoft Azure and Google Cloud — continue to dominate the landscape. More than half (54%) of the technology services firms surveyed by Tercera listed one of these three cloud service providers as their primary partner, and the partners in these ecosystems reported on average higher growth than those in other ecosystems.
AI drives demand, but partnering remains a Wild WestFinancial performance and the insatiable demand for GenAI offerings kept Nvidia and OpenAI on the list for 2024, along with Anthropic, an LLM provider with tight ties to the AWS ecosystem. Each of these rapidly growing, highly valued companies is still working out its partner motion. Establishing a formal partnership with these players to date has required brand heft or a herculean effort, however all are making moves that show partners are a clear part of their growth strategy. These are also critical capabilities for any firm looking to be seen as a GenAI leader.
Partners and providers lean into industry specializationVertical SaaS companies are on the rise. According to Bessemer, these companies already represent a combined market capitalization of ~$300 billion, and the rise of Vertical AI (LLM-native applications that serve specific industry use cases) could create an even bigger addressable market. This, and the increasingly verticalized go-to-market motions of many in the Tercera 30, is pushing partners to hone their industry chops and creating a surge in AI-native services firms focused on industry use cases.
An industry-focused watch listTercera dedicated its 2024 Watch List to five industry cloud companies across insurance, banking, retail and manufacturing. These companies include: Duck Creek Technologies, Guidewire, Körber, and nCino and Veeva. More detail on them can befound in the report.
Tercera 30 methodologyTo develop the list, Tercera evaluated more than 150 vendors. The 30 finalists were selected by analyzing public and proprietary data, as well as research from data partners likeCleveland Research, G2, and Solon Altman. This was complemented by interviews with market insiders, investment bankers, software partner leaders, and a survey of 250 IT service firm leaders. A full overview of the methodology can be found here.
2024 Tercera 30 listThe Market Anchors:These are the 10 largest publicly-traded software companies with mature partner programs that support hundreds to thousands of partners.
— Adobe
— AWS
— Google Cloud
— Microsoft Azure
— Oracle
— Salesforce
— SAP
— ServiceNow
— Snowflake
— Workday
The Market Movers:These are 10 large to mid-size, publicly-traded software companies actively building out their partner ecosystems and taking growing mindshare with enterprise buyers.
— Atlassian
— Braze*
— Dynatrace*
— Nvidia
— MongoDB*
— Okta
— OneStream
— Palo Alto Networks
— Shopify
— Zscaler*
Market Challengers:These are 10 high-growth, private software companies leaning on partners for growth and grabbing outside attention in their market segments.
— Anthropic*
— Celonis
— Cohesity*
— Contentstack
— commercetools
— Databricks
— Fluent Commerce
— OpenAI
— Stripe
— Wiz*
*new to the list
About TerceraTercerais an investment firm founded to accelerate the growth of people-centric businesses. Specializing in the $1 trillion IT services market, the Tercera team is composed of invested operators who know first-hand what it takes to build and scale a successful services business. Tercera is on a mission to identify next gen tech ecosystems and service providers, and provide them with the capital, counsel and connections they need to achieve outsized outcomes.
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