Salesforce, Workday, Zendesk. Although they serve many different purposes, they have one thing in common: they are part of a new wave of companies that provide software-as-a-service, commonly referred to as SaaS.

So what exactly is SaaS?

Gartner defines SaaS as “software that is owned, delivered and managed remotely by one or more providers. The provider delivers software based on one set of common code and data definitions that is consumed in a one-to-many model by all contracted customers at anytime on a pay-for-use basis or as a subscription based on use metrics.”

The SaaS market is growing rapidly. In 2010, Gartner estimated that SaaS would be a $21 billion market in 2015, but the actual market has outpaced expectations.  It seems to be growing exponentially, based on this fitted graph below.

There is a lot to cover, and in part two, I will discuss SaaS business models and key terms. Enjoy the rest of your weekend.