Can SaaS companies survive?

There is at least one way SaaS companies can be severely affected by beta factors such as Covid-19 and other unknown ebbing tides. I took a company public in 2000, ostensibly the first SaaS company and before we interpreted the word “Cloud” as we do today. We raised $180m in the IPO in June 2000. We hosted software applications for companies including Oracle, PeopleSoft, Siebel, and a handful of others. We had server farms and IT guys and offered and managed the above company’s software remotely (after partnering with those companies, of course) whose regular customers (at the time) typically would install onsite, have their own servers and their own IT teams in house, yep, every company’s cap ex and headcount spend was ridiculous to have everything in house behind firewalls…the old school way (I.e. every one does it for themselves). We had 1-3 year contracts to host for them remotely, deferred revenues, recurring revenues, the whole shebang. What happened? Well, 50%+ of our customers went under in the crash in a matter of 6 months and we never saw those contract revenues. Those defunct customers had little or no revenue, no earnings, not much cash and no path to profitability, as was a sign of the times. Hard to believe many were public companies. We survived due to our strong balance sheet (cash is king) and quick action to downsize our headcount and try to stay profitable, but it was absolutely brutal laying off half the company. I left to go be CFO at another company in the valley, and the company I’d taken public was sold a year later to IBM, but not before the stock swooned from $21 all the way down to $1.90 with every other tech company of the time. Stupidity of the day is that we (the company) were worth more per share in cash (but poison pills and the times, etc prevented someone buying us easily…was a crazy period)!! I now have a portfolio of 10 of these SaaS companies. They are up several hundred percent the past 3 years. Today is but a blip and I am not selling them. The advantage today is that all of them are much more established and have large numbers of Fortune 1000 companies as customers. 50% of their customers are NOT going out of business this time around. Some will, of course…smaller customers perhaps if this madness continues long enough, and that could impact the 10 growth companies that I own in the short-term, but most of their customers, especially the large ones, will survive and (as already discussed ad nauseam on this board) many existing and established large companies and all new companies will eventually adopt SaaS (if they haven’t yet) and become their customers also…Else they will not be able to compete with smaller, nimble fast growing players. So yes…our SaaS companies fundamentals could be affected short-term (ST), but on a much smaller scale, and the stock price could get thrown out with the bath water, ST as exemplified today, but that will be my/our advantage to pick these up on the relative cheap. I just don’t see a repeat of that first company I took public (different world, different circumstances)…but I sure learned a ton from helping build it and living through the Armageddon of that time. For what it’s worth, I nibbled on more AYX, CRWD, OKTA and ZM this morning at the lows. Watched ZM scream from $102 back to $114 in about an hour!! Wicked vol!! Love the opportunity!! Cheers!!