What Qualtrics’ CEO Says Software Companies Must Possess

The “SaaSpocalypse” of earlier this year—based on the notion that powerful AI models will soon make companies selling software-as-a-service obsolete—turned out to be a phantom. A quick look at Salesforce’s stock price, for instance, shows it is now back to where it started the year, after a 40% swoon.

But SaaS companies are still racing to transform themselves, for what they believe will be a new era in which data will have to be transformed into knowledge to have real value.

The latest example comes from Qualtrics, which later today will announce its new XM Data and AI platform. I spoke yesterday with CEO Jason Maynard and Executive Chairman Ryan Smith, who are holding today’s event in the training center of one of Smith’s other businesses—the Utah Jazz.

Their new platform is designed to take the customer experience data that Qualtrics has always collected for its customers and use it to do simulations of changes to products and services that can predict customer outcomes. They are particularly excited about the applications it will have in healthcare, made possible by their recent $6.75 billion acquisition of Press Ganey. Their goal, says Maynard, is to make “the healthcare experience in the future be like the best experiences you have in any industry.”

I asked Maynard and Smith what will determine which SaaS companies successfully make the AI transition and which don’t.

“I think, first of all, you have to have the will to reinvent,” Maynard said. “You’ve got to believe the future is going to be different.

“You then need to have some of the raw ingredients. We have the world’s largest human experience data set…which allows us to build new things and new capabilities that are unique. AI can’t do it without our 20-year history of experience and expertise.”

Qualtrics has had an unusual ownership history. It was founded by Smith, his brother and his father in 2002, and bootstrapped by them until 2012. After raising venture capital, they then made plans to go public in 2018. But just a few days before trading started, SAP swooped in and bought the company. Then in 2021, SAP decided to spin it out via an IPO that valued it at $21 billion. Two years later, Silver Lake took the company private again.

Smith said being private will make it easier to undertake the transformation they are announcing today.

“The benefit of being private is you can go a heck of a lot faster,” Maynard said. “If you look at the way we are rolling this out,” agreed Smith, “it’s a different operational rhythm.”

Alan MurrayPresident, WSJ Leadership Institute

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