Who Owns NetSuite : A Brief History

Simply answering the question Who Owns NetSuite does not give the full story of this genre defining ERP system. Who owns NetSuite today? Oracle Corporation. But NetSuite existed, in some form, for 18 years prior to that sale in 2016.

Let’s take a walk through the NetSuite story from that initial phone call between Evan Goldberg and Larry Ellison to today where it is one of the top cloud ERP systems in the world.


Who Owns NetSuite?

Today NetSuite is owned by Oracle Corporation. The acquisition offer was made in July 2016 and closed at $9.3 billion.


How NetSuite Started

NetLedger was formed in 1998 and was the precursor to NetSuite

Evan Goldberg had spent 8 years at Oracle before going his own way in 1995. 3 years later he had a phone call with Oracles co-founder Larry Ellison in which they formulated the idea of a web hosted accounting software.

That idea became NetLedger.

The company was funded by Larry Ellison through his venture capital firm Tako Ventures. The initial seed capital from Ellison was in the region of $125 million and further funding was raised from a handful of other investors.

As well as Larry Ellison being a key figure in the origin story of NetSuite, many of the early employees also came from Oracle. From day one there was a complicated relationship between the two organizations that eventually sparked controversy during NetSuite’s acquisition, which we’ll come to discuss.

2001 saw the release of the NetLedger 1 System. This was the first of it’s kind – a web-based primary business solution for everything from Payroll and accounting to CRM and inventory management.

In a NetLedger press release in April 2001, Evan Goldberg was quoted as saying “The idea of one application to run your entire business is not new, but what is revolutionary is this power is now within reach of any small and mid-sized company with NetLedger 1 System”.

Despite Evan Goldberg’s sales talk in this quote, NetLedger 1 System was, notably, aimed at smaller businesses. This was one market cracked but the company had sights set on another demographic and was already working on a solution

Who owned NetSuite in 2002? A group of private investors

In July 2002, Zach Nelson was appointed as CEO of NetLedger Inc and Evan Goldberg settled in to his role as CTO. Nelson was a big believer in the future of web-based software solutions so was a perfect fit for the business.

Just three months after the appointing of Zach Nelson, NetLedger announced the release of the very first version of NetSuite.

An October 14, 2002 press release was headlined “NetLedger launches NetSuite™, the first online suite that combines ERP and CRM functionality aimed at mid-size companies”.

NetSuite was a far more complete solution for medium sized organizations than previous NetLedger offerings and it came at four times the price at it’s most basic level.

A 2002 NetSuite system would cost anything from $400 per month for three users to $3,750 for completely unlimited use.

NetLedger had started out as an accounting solution and although they had built a string of successful offerings it was the NetSuite product that had cemented their reputation. NetLedger had set the foundation but NetSuite was clearly the future. This thinking was solidified in September of 2003 when the company changed it’s name to NetSuite Inc.

Who owned NetSuite in 2007? The public

In December 2007 Zach Nelson rang the opening bell at the New York Stock Exchange and announced NetSuite Inc’s initial public offering.

6.2 million shares were released at a price of $26.00.

The timing was great for NetSuite as the fourth quarter of 2007 closed off the best year in the companies history.

It was also around this time that NetSuite released another game changing solution – NetSuite OneWorld. This new add-on functionality allowed multi national mid-sized organizations to operate globally with a single business system. This was the first solution of it’s kind and provided the basis for the multi subsidiary accounting benefits that NetSuite has become renowned for.

Who owns NetSuite? As of 2016 it is owned by Oracle

By the end of 2015 NetSuite had grown to pulling in close to three quarters of a billion dollars in annual revenue. Larry Ellison still owned over 40% of the company but that didn’t stop quiet discussions from beginning between Larry’s ‘other’ company and NetSuite.

On July 28 2016, Oracle released a statement confirming they had ‘entered into a definitive agreement to acquire NetSuite’.

Larry Ellison’s position in both companies caused immediate speculation that there was some layers to this deal. Ellison was set to net around $3.5 billion from the deal and critics suggested NetSuite was being over valued. This was after all the second largest acquisition Oracle had ever made.

In response to critics, Oracle confirmed a board of independent directors had evaluated and negotiated the deal and that Ellison would abstain from NetSuite shareholder voting.

Despite all the controversy, the deal closed on November 7 2016 and NetSuite became a subsidiary of Oracle Corporation.


Now you know the history, let’s take a look at the future! How has NetSuite embraced the AI Revolution?

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