IT:BD:Marketing

But Atlassian is breaking from the mold of most enterprise software companies, which invest heavily to employ armies of salespeople to push products to new customers.

Atlassian doesn’t employ a single salesperson. With the money it saves, the company invests heavily on research and development, building products with the aim that they are good enough to spread by word of mouth (helped along by a modest marketing budget for billboards and online ads).

“Fifteen years ago, as long as you had the best distribution you would win,” Mr. Farquhar said in an interview. “It didn’t matter whether Oracle was worse than SAP. These days, people are making decisions based on how good the products are.”

Mr. Farquhar said Atlassian is profitable as a result, and it has been cash-flow positive each quarter for the past 12 years. Its sales have risen an average of 40% annually over the last five years, and its revenue run-rate, or the amount the company would generate by extrapolating current revenue over the next 12 months, is over $200 million.

Atlassian’s profitability stands in stark contrast to Box, the online-storage company founded just three years later that last month filed its public IPO prospectus. Last year, Box doubled its revenue to $124 million but it racked up a loss of nearly $169 million. Box spent more than 100% of its revenue — or $171 million — on costs like sales commissions, advertising and stock compensation. Box also had negative operating cash flow of $91.8 million.