Veeva Systems (VEEV): The Operating System for Life Sciences

1. Executive Summary

Veeva is the gold standard for "Vertical SaaS." It has successfully monopolized the CRM market for pharma sales reps and is now replicating that dominance in R&D and Clinical Trials via the "Veeva Vault" platform. It is profitable, founder-led, and expanding its TAMS beyond life sciences.

Key Thesis Points

1. Commercial to R&D Shift: While "Commercial Cloud" (CRM) is maturing, "Vault" (R&D, Clinical Data, Quality) is growing rapidly and has a larger long-term TAM.
2. Platform Independence: Veeva is migrating its backend from Salesforce to its own infrastructure ("Vault Direct"), improving gross margins and reducing platform risk.
3. Data Cloud: "Veeva Link" and "Compass" are emerging data products that leverage Veeva's network effects to sell proprietary industry data, a highly lucrative revenue stream.

2. Business Overview

• Commercial Cloud: CRM for pharma sales teams. Helping reps track interactions with doctors. Deeply entrenched (~80% market share).
• Veeva Vault: A content management platform for drug development. Manages everything from clinical trial data to regulatory submission documents.
• Service & Services: Professional services to help pharma giants implement these complex systems.

3. Financial Analysis

(See Financials Tab for live data)

• Profitability: Unlike many SaaS peers, Veeva was profitable almost from day one.
• Retention: Net Revenue Retention (NRR) often exceeds 120% in the Vault segment, indicating strong "land and expand" dynamics.
• Duration: Contracts are long-term and extremely sticky. Switching costs for a pharma company in the middle of a clinical trial are effectively infinite.

4. Valuation

Veeva commands a premium "Quality" multiple.

• Defensiveness: Healthcare/Pharma IT spend is resilient to recessions. Drug trials must continue regardless of GDP.
• Growth: Investors expect steady 15-20% growth for a decade, justifying a higher PEG ratio.

5. Risks

• Salesforce Divorce: Moving off the Salesforce platform is technically risky and could friction with customers who love the Salesforce ecosystem.
• Market Saturation: In Commercial CRM, they have almost won everyone. Growth must come from Vault or new verticals (CPG/Chemicals).