The Unlikely Birthplace of NetSuite
In a small office, above a barbershop in San Mateo, California, one of the business software platforms that revolutionized the industry and transformed business management was born. This innovative software, NetSuite, was created by Evan Goldberg in a modest office where the constant hum of the barbershop hairdryer served as background noise.
From Failure to Success
Evan Goldberg’s journey to success wasn’t straightforward. Before founding NetSuite, he established mBed Software, a company focused on interactive websites. However, this venture failed, which Goldberg refers to as his “obligatory Silicon Valley failure.”
This setback prompted Goldberg to reflect on the genuine needs of small and medium-sized enterprises (SMEs). He recognized that these businesses required tools to manage their operations efficiently, particularly in areas like accounting, inventory management, sales, and customer relationships.
In 1998, these insights laid the groundwork for NetSuite, the first fully cloud-based Enterprise Resource Planning (ERP) platform.
Challenges of Pioneering New Technology
Goldberg’s experience preceded NetSuite. He had worked as vice president of development at Oracle, where he met Larry Ellison, the company’s founder. Goldberg shared his project idea with Ellison, who became an investor (providing $125,000) in the initial version of the software, NetLedge.
“We were upstairs from a video rental store, programming for the company. So we named it NetLedge, referring to that ledger book,” Goldberg recalls.
Goldberg’s vision was to create an all-inclusive and accessible solution for businesses, leading to the creation of NetSuite (a combination of ‘Net’ for internet and ‘Suite’ encompassing everything in a solution) and pioneering the Software as a Service (SaaS) model, even before Salesforce, Google Workspace, or Microsoft embraced it on a large scale.
“No one had created an enterprise application that functioned on the internet before. We were the first, so we had to invent many things ourselves,” Goldberg explains.
Some ideas worked, while others didn’t. Still, they eventually developed a successful system.
One significant challenge was commercializing the product, as financial managers were hesitant about cloud technology and deeled that storing information online was unnecessary. However, they eventually recognized the benefits of secure data storage in a centralized database and adopted the technology.
Consolidation
NetSuite went public in 2007, and in 2016, Oracle acquired it for $9.3 billion. Despite this acquisition, Goldberg continued leading the project as part of Oracle, the very company where it all began.
Today, the office above the barbershop in San Mateo may seem insignificant. Yet, it symbolizes that great companies don’t necessarily originate in skyscrapers but can emerge anywhere vision, talent, and a genuine need to solve a problem converge.
Five Recommendations for SMEs
Evan Goldberg offers five benefits to small businesses that haven’t yet embraced technology:
- 1. Information: Technology helps businesses understand their operations and make better-informed decisions.
- 2. Control: As businesses grow, it becomes impossible for managers to oversee every detail. A system ensures everyone follows efficient processes.
- 3. Agility: Businesses and the world change, and technology can adapt to these shifts, especially as companies expand.
- 4. Productivity: Companies don’t want employees spending time searching for information or manually transferring data between systems.
- 5. Collaboration: Effective communication and organization within an organization improve when everyone uses the same system.
