# Veeva _The CRM beachhead that became a platform._ --- ## The insight at Salesforce In 2007, Peter Gassner was four years into his role as Senior Vice President of Technology at Salesforce. He'd spent nearly a decade before that at PeopleSoft, first as Chief Architect, then as General Manager of PeopleTools. He understood enterprise software deeply - how it was built, how it was sold, how it became indispensable. What he saw at Salesforce was a platform powerful enough to build industry-specific applications, but a company with no interest in doing so. Salesforce wanted horizontal scale. Every vertical was a distraction from the main event. Gassner saw the opposite opportunity. Life sciences companies - pharmaceutical firms, biotechs, medical device makers - had unique requirements that generic CRM couldn't address. Sales reps visiting physicians needed to track samples, manage compliance, navigate complex regulatory constraints. The workflows were specific enough that a purpose-built solution would win against configured generics. He left Salesforce, recruited Matt Wallach from Siebel Systems, and founded Veeva - initially as "Verticals onDemand" - to build CRM for life sciences on the Salesforce platform. In 2007, most investors thought industry-specific cloud software was a [[Niches|niche]] too small to matter. Gordon Ritter at Emergence Capital disagreed and invested $4 million in 2008. By 2012, Veeva CRM had captured over 80% of the pharmaceutical CRM market. The niche turned out to be enormous. --- ## Why pharma is different Pharmaceutical sales isn't normal sales. A rep visiting a physician operates under constraints that don't exist in other industries. Sample management is regulated. Every drug sample given to a physician must be tracked, reported, and reconciled. The Prescription Drug Marketing Act makes this a legal requirement, not a convenience feature. A CRM that doesn't handle sample compliance natively requires manual workarounds that create audit risk. Call reporting follows specific patterns. Reps don't just log meetings - they record details about product discussions, competitive mentions, and physician responses in formats that feed into marketing analytics and regulatory submissions. Territory management in pharma reflects healthcare geography. Reps are assigned to physicians, not companies or regions. A single hospital might have dozens of relevant prescribers, each requiring separate relationship management. These requirements aren't configurable in generic CRM. They're fundamental to how the software works. Veeva built them into the core product, making adoption straightforward for pharma companies that would otherwise spend months customising Salesforce or Oracle. This is [[Counter-positioning]] against generalist platforms - Salesforce's horizontal ambitions prevented it from going deep enough to serve pharma natively. The result was rapid capture of a highly concentrated market. Pharmaceutical companies are large, well-funded, and few in number. By 2019, Veeva served 47 of the world's top 50 pharmaceutical companies. Once the leaders adopted the platform, followers had little choice - Veeva became the industry standard. --- ## The expansion sequence The key insight was recognising that CRM was a beachhead, not a destination. Pharmaceutical companies don't just sell drugs - they develop them. That process involves clinical trials, regulatory submissions, quality management, and safety monitoring. Each function has its own software needs, its own compliance requirements, its own [[Switching costs]]. In 2011, Veeva introduced Vault - a content management platform built for regulated industries. Unlike CRM, which ran on Salesforce's infrastructure, Vault was built on Veeva's own technology stack. The timing was deliberate. CRM had established relationships with pharmaceutical companies. Vault could expand those relationships into new departments. The expansion followed a logical sequence. A pharmaceutical company using Veeva CRM for sales discovered that Veeva also offered solutions for their clinical operations team. Then regulatory affairs. Then quality management. Each additional product deepened the relationship and raised switching costs. By 2026, Veeva offers eight application families: CRM, PromoMats (marketing content), MedComms (medical information), Clinical Operations, Clinical Data Management, Regulatory, Quality, and Safety. The company serves over 1,400 customers, with significant overlap between commercial and R&D solutions - evidence that cross-selling works. The revenue split tells the story of successful expansion. R&D solutions - clinical, regulatory, quality - now generate more revenue than commercial solutions. What started as pharma CRM has become an enterprise platform for life sciences operations. --- ## The Salesforce question For fifteen years, Veeva CRM ran on Salesforce's platform. This created strategic tension. Veeva's success depended partly on infrastructure it didn't control. Salesforce could, theoretically, enter the life sciences vertical directly. In December 2022, Veeva announced it would not renew its Salesforce partnership when it expired in September 2025. The company would migrate all CRM customers to its proprietary Vault platform - the same infrastructure that powered its R&D applications. The decision was risky - a textbook [[Complements]] dilemma where the platform you built on becomes the competitor you must escape. Customers had built customisations, integrations, and workflows on Salesforce. Migration would require rebuilding coded objects in Java instead of Salesforce's Apex language. Third-party integrations wouldn't transfer automatically. But the strategic logic was sound. Vault CRM gives Veeva complete control over its technology stack. It eliminates platform fees paid to Salesforce. And it creates a unified architecture where CRM data flows naturally into clinical, regulatory, and quality applications. The migration timeline extends to 2030, with most transitions expected between 2026 and 2029. By early 2026, Veeva had over 80 Vault CRM deployments live, with major pharmaceutical companies - Merck, Roche, Novo Nordisk, GSK - committed to the new platform. Salesforce hasn't ceded the market. In October 2025, Salesforce launched Life Sciences Cloud in partnership with IQVIA, which contributed its OCE CRM technology to the effort. The competitive landscape is now genuinely contested for the first time in a decade. Veeva's response has been to emphasise integration advantages. A pharmaceutical company running Vault CRM, Vault Clinical, and Vault Regulatory operates on a single platform. Data flows across applications without integration complexity. That unified architecture is difficult for competitors to match. --- ## The public benefit question In February 2021, Veeva became the first publicly traded company to convert to a public benefit corporation - a legal structure that requires balancing shareholder interests with those of customers, employees, and communities. The conversion passed with 99% shareholder approval. Gassner framed it as formalising what Veeva already practiced: long-term thinking that prioritised customer success over short-term extraction. The philosophy shows in specific policies: no noncompete agreements, stock grants that make every employee a shareholder, a no-layoff commitment during downturns. Glassdoor ratings hover around 4.4 out of 5. For customers in regulated industries, the PBC structure provides a signal. Pharmaceutical companies depend on their software vendors for compliance and data integrity. A vendor legally committed to customer welfare - not just shareholder returns - offers a different kind of assurance. Whether this creates competitive advantage is debatable. What's clear is that it creates alignment. Veeva's business model depends on long-term customer relationships, not maximising revenue extraction from each contract. The PBC structure makes that alignment explicit and legally binding. --- ## The compound effect Veeva's growth compounds through a mechanism similar to [[Jack Henry]] and [[Tyler Technologies]], but accelerated by the wealth of its customer base. Existing customers expand. A pharmaceutical company using Veeva CRM adds PromoMats for marketing compliance. Then Vault Clinical for trial management. Then Vault Regulatory for submissions. Each addition increases revenue per customer without new sales effort - [[Customer-funded growth]] through the expansion sequence. Each product deepens switching costs. A company running one Veeva application might consider alternatives. A company running six applications across commercial and R&D has built its operational backbone on the platform. Leaving would mean replacing everything simultaneously, migrating years of validated data, and retraining thousands of employees. The financial results reflect this compounding. Revenue has grown from $210 million in fiscal 2014 to over $2.7 billion in fiscal 2025 - a 13x increase in eleven years. Subscription revenue represents 84% of total revenue and grows faster than the overall business. Net revenue retention exceeds 120%, meaning existing customers spend more each year even before counting new logos. The balance sheet is unusually strong. Veeva holds over $5 billion in cash and investments with no debt. Operating cash flow margins approach 40%. This financial position funded the Salesforce migration without external capital and provides cushion for continued R&D investment. --- ## What this teaches Veeva illustrates principles that extend beyond life sciences software: **Beachheads enable platforms.** Veeva didn't try to build an enterprise platform from day one. It built a dominant position in one application - CRM - then expanded into adjacent workflows. The initial product created customer relationships; subsequent products monetised them. **Regulated industries reward specialisation.** Pharmaceutical companies face compliance requirements that generic software handles poorly. Veeva built those requirements into the core product, making adoption straightforward and alternatives painful. In regulated markets, deep domain expertise creates moats that scale can't overcome. **Platform dependency is strategic debt.** Building on Salesforce accelerated Veeva's early growth but created long-term vulnerability. The migration to proprietary infrastructure was expensive and risky - but necessary for strategic independence. Companies building on platforms should plan their exit strategy from the beginning. **Switching costs compound across products.** One application creates moderate switching costs. Six applications create an operational backbone. Veeva's expansion strategy wasn't just about revenue growth - it was about making the relationship progressively more permanent. **Customer concentration can be an advantage.** Pharmaceutical companies are large, wealthy, and few in number. Serving 47 of the top 50 creates both reference value and competitive moat. In concentrated industries, winning the leaders means winning the market. The company isn't exciting in the way consumer technology companies are exciting. It manages drug samples, regulatory submissions, and clinical trial documents. But it does so for nearly every major pharmaceutical company in the world, with 80% market share, 120% net revenue retention, and a platform that expands deeper into customer operations every year. That's what vertical dominance looks like in practice. --- **Connects to:** [[Verticals]]