Emergence Capital had a huge hit this year with Zoom. Here are some of the other software trends a partner expects to boom. (ZM)

Emergence Capital is narrowly focused on investing in early-stage enterprise software companies.
That specialization helps give it an edge over rivals when it comes to getting in on deals in the sector, Santi Subotovsky, a general partner at the firm, told Business Insider.
Emergence can offer startups access to all its partners and a community of founders at similar companies experiencing like challenges, he said.
Subotovsky remains bullish on the enterprise software sector, saying such as the need for mobile enterprise applications, the productivity promise of artificial intelligence, and the desire to replace aging software will boost demand for new services.
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Enterprise software is one of the hottest areas in tech, and lots of venture-capital firms have tried to get in on the action.
But Santi Subotovsky thinks Emergence Capital has an edge over its rivals when it comes to investing in such companies — its very narrow focus. Emergence only invests in early-stage enterprise software companies, said Subotovsky, a general partner with the firm. That allows its portfolio companies to tap into the knowledge of any and all of Emergence’s partners. And the firm can connect founders to peers who are running similar firms and facing like challenges.
“That creates an incredibly powerful community,” Subotovsky told Business Insider in a recent interview. “You’re building a relationship with the entire team, and that makes a huge difference.”
Emergence has been around for 15 years and has backed some of the more successful enterprise startups over that time, including Salesforce, Veeva, and Box. But it had one of its biggest successes earlier this year when another one of its portfolio companies, Zoom, went public and more than doubled its IPO price within a few weeks.
The firm only makes about five to seven investments each year — all in A rounds. But because of its specific focus, it gets to look at pretty much all the companies in the enterprise space, Subotovsky said. Seeing that many companies allows it to survey the landscape and pick the ones it thinks have the best chance of succeeding, he said. It can also tap into its own knowledge of how such companies have developed in the past, he said.
“We’ve seen this movie play out many times in enterprise,” Subotovsky said.
Emergence’s partners all focus on the enterprise sector
Emergence’s narrow focus is also a benefit to its portfolio companies, he said. Subotovsky and his partners know what it takes for nascent enterprise startups to reach their potential, he said. 

Many venture firms only have one or two partners focusing on such companies, and they often spend their time with their portfolio companies just meeting with the CEO. Emergence’s partners all work with its portfolio companies and they end up meeting with many of the companies’ top leaders — not just their CEOs. Subotovsky said it’s not unusual for him to meet with a portfolio company’s heads of marketing, sales, or product.
“I spend time with the CEO, because I want to help them out,” he said. “But if I can help out the rest of executive team, then that has a huge impact on the organization.”
At other firms, where only one or two partners focus on enterprise startups, the firm’s relationship with the startup can be disrupted if one of those partners leaves, Subotovsky said. But that’s not a danger with Emergence, since the entire firm develops a relationship with the startup and the partners only focus on enterprise companies, he said.
Zoom aside, the stock market has been rough for many of this year’s high-profile IPOs. Uber, Lyft, and Slack are all well off their initial prices and WeWork had to pull its offering after facing stiff resistance from potential investors.
Even so, Subotovsky remains bullish on the enterprise software sector. Some big trends in the market will continue to drive demand for new products and create opportunities for startups, he said.
Mobile phones and AI will boost demand
For one thing, the near ubiquity of smartphones has created a need and an opportunity for workplace applications that are designed with those devices in mind, he said. Much of the enterprise applications that have been built in the past have been designed to be used by office workers sitting at desktop computers. But there’s a whole “desk-less workforce,” Subotovsky refers to it, of people who can now access enterprise applications through their mobile phones.
ServiceMax, an Emergence-backed company that GE acquired three years ago, offers a service that helps companies direct their field service technicians to particular customers and helps them place orders for new parts all through a mobile app. Similarly, UpKeep, another of the firm’s portfolio companies, offers a mobile application that helps restaurants, manufacturers, and property management companies direct maintenance workers to repair jobs.
Such apps are replacing antiquated solutions and technologies, such as pen and paper and simple spreadsheets, Subotovsky said.
Catering to such workers “expands the market a lot,” he said. “The desk-less workforce,” he continued, “needs productivity apps.”
Another factor that’s going to continue to boost the enterprise software sector is the continued development of artificial intelligence, including in machine learning and natural language processing, Subotovsky said. Such technologies have plenty of applications, he said. And while some fear they will be used to replace workers, he thinks they will actually be used to help workers and make them more productive. 
Companies are looking to replace older apps
Take, yet another Emergence-backed company. It has developed a service that listens in on sales calls and uses artificial intelligence to analyze the conversations to determine what sales people are doing right and what they can improve on. Similarly Textio has developed a service that enhances job-wanted postings, taking simple ideas and requirements and turning them into polished sentences that are designed to attract desired candidates.

“From what you do, the technology should be able to learn and adapt to help other people do their job better,” Subotovsky said. “So we’re super-excited about that.”
The enterprise market is also likely to be driven by a demand to replace and upgrade older business-oriented applications, he said. Zoom’s video conferencing application was by no means the first of its kind. But older video-conferencing services had failed to keep up with innovation, Subotovsky said. Business customers were asking for a better, more up-to-date tool, he said.
Similarly, he thinks there might be an opportunity for an upstart to take on Salesforce. Salesforce has a negative net promoter score — a measurement that indicates customer satisfaction and loyalty — he said.
“People don’t love it,” he said. “That’s a great sign,” he continued, “that there’s an opportunity for someone to come up with a solution people love.”
Got a tip about venture capital or startups? Contact this reporter via email at, message him on Twitter @troywolv, or send him a secure message through Signal at 415.515.5594. You can also contact Business Insider securely via SecureDrop.

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