This page contains the strategy for GitLab's multi-tenant SaaS offering, GitLab.com, and is maintained by the Infrastructure Product Manager. GitLab.com runs the same codebase as self-managed GitLab without customers needing to install, administer, and operate the service. GitLab.com is fully-managed by GitLab, Inc and is primarily hosted in Google Cloud Platform in the United States. GitLab.com provides both free and paid options for individuals and teams as well as the added bonus of free CI minutes in each tier. GitLab.com is a popular service with over 700K monthly unique active users as of August 2020 growing at an average of 1.9% month-over-month (25% CAGR) since the start of 2020.
The worldwide DevOps software tools market is expected to grow rapidly at 16% CAGR through 2024 according to IDC. IDC projects that SaaS-based delivery of DevOps tools (26.4% CAGR) will overtake self-managed solutions (7.1% CAGR) by 2022. This represents a large opportunity for GitLab, which has only an estimated 9% usage-share of the Cloud hosted Git repository market, based on Bitrise repostory counts, far below our 67% usage-share of self-managed Git solutions.
When evaluating GitLab.com, enterprises tell us they need more sophisticated controls to better manage their users, groups, and projects on GitLab.com, increased availability and performance of the overall service, and security enhancements like industry standard certifications and customer audit logs. We are currently seeing strong growth in paid monthly active users on GitLab.com at a YoY rate of 216% as of August 2020 and expect this trend to continue next year. From September 2020 until the end of FY22, we aim to grow the number of paid monthly active users by 133%. To do this, we will focus on increased enterprise adoption of GitLab.com by eliminating key feature gaps.
According to IDC, the worldwide DevOps software tools market will grow from $8.5B in 2019 to $17.7B in 2024. IDC predicts stronger than previously expected adoption of SaaS-delivered solutions over this time period as part of a growing preference among enterprises for cloud-based architectures, which provide greater operational flexibility. Adoption of DevOps tools that enable better collaboration among development teams is also expected to accelerate over this time period according to IDC, as more work is done remotely due to the global pandemic. IDC predicts that the market for SaaS-based DevOps tools (currently 38% of the market) will overtake the self-managed market (62%) by 2022 and account for $10.3B in revenue (or 58% of DevOps software tools market) by 2024. As a result, over this time period we expect to see an increase in existing self-managed users migrating to GitLab.com as well as the majority of prospective customers preferring SaaS over self-managed deployment.
The expected shift in deployment preference to SaaS based cloud services in the upcoming years presents a large and growing opportunity for hosted git repository providers of whom the major vendors are GitHub (56% usage share), BitBucket (30%), and GitLab.com (9%) according to Bitrise repository counts.
As the largest host of source-code in the world with over 100 million repositories, GitHub has high brand recognition and boasts a thriving developer community. GitHub can tap into the strengths of its parent company, Microsoft, by offering discounts to customers who commit to Azure, cross-selling GitHub to existing Azure customers, and deep integration with Azure services to make it easier to adopt GitHub. While GitHub offers strong Source Code Management capabilities, its CI/CD offering, Actions (launched in 2018) is less mature than competitors. GitHub is missing critical planning features like milestones, issue weights, and due dates, all of which are available in GitLab. Finally, GitHub does not come with a built-in deployment platform (unlike GitLab which provides out-of-the-box integration with Kubernetes) requiring customers to leverage third-party solutions to fill the gap.
Bitbucket saw a 3% decline in market share YoY according to Bitrise, but offers the advantages of tight integration with the rest of the Atlassian product suite including collaboration tools like Jira and Confluence.
Compared to competitors, GitLab.com offers a broader feature set providing customers with a complete, end-to-end DevOps platform delivered as a single application. Improved integration between Atlassian tools and GitLab will make it easier for customers to use solutions across the two ecosystems (e.g. support for Jira in GitLab) and provide a strong alternative to customers who don’t want to be locked into the Microsoft ecosystem.
IDC predicts continued M&A activity in the DevOps market through 2024 as larger vendors look to strengthen their portfolios to meet the needs of customers who want a single solution for their entire DevOps lifecycle. While this may consolidate competitive pressure, it may also drive adoption of GitLab as DevOps customers look to standardize their toolchains around established players.
We see the following challenges to growing paid-user adoption of GitLab.com in FY22:
We segment customers based on organization size (number of employees): large, mid-market, and SMB (small business). Thus far, we’ve had success attracting the SMB and mid-market segments (the large majority GitLab.com users fall within the free or Bronze tiers) by offering significant free tier value (including private repos and build minutes). We are working on a variety of optimizations to reduce costs of supporting free users as well as changes and experiments to improve the conversion rate of free customers to into paid tiers, all of which we will continue into next year.
Compared to the SMB and mid-market segments, we’ve seen less adoption of GitLab.com among large enterprises. As large enterprises look to increase usage of SaaS delivered DevOps solutions and tools to enable collaboration among remote development teams through 2024, we believe this segment offers a substantial revenue opportunity. As a result, we will target large enterprise customers in FY22. While we will continue efforts towards making free users a cost effective customer acquisition source and meeting margin targets across each tier, we will now also focus on growing adoption of paid tiers by increasing our win rate of deals involving large enterprise customers.
To track key adoption blockers among enterprise customers, we use the label ~"GitLab.com Enterprise Readiness". The top issues needed to achieve enterprise readiness for GitLab.com are tracked on the following two boards:
Customer needs generally fall into three categories:
A critical component of SaaS growth relies on focusing on the needs of the enterprise customers. To improve our market position and increase our .com win rate, we must address key adoption blockers and feature gaps for this market segment. To accomplish this, we will focus on enterprise-readiness for GitLab.com.
The 12 month customer-facing roadmap for GitLab.com to achieve enterprise-readiness is presented below. Where applicable, we also highlight any supporting initiatives that need to be completed to deliver each roadmap item.
We will achieve this by helping the Manage Stage better capture the opportunity and customer demand for each of these features. To learn more about how the Manage stage is planning to close feature gaps needed to achieve enteprise readiness, see this section in the Manage direction page.
We will achieve this by partnering with the Security Department to drive delivery of these features across the approproate stage groups.
In FY22 we will continue to prioritize Dogfooding efforts to
As part of our Dogfooding efforts in FY22, one of the major questions we'd like to answer is: can we leverage Geo to help meet our Disaster Recovery targets for GitLab.com?
Besides closing feature gaps for enterprise customers, in FY22 we will also invest in foundational projects within the Infrastructure department to improve overall efficiency of operating GitLab.com. This bucket of work includes projects like:
The following items are currently not in scope for FY22:
To ensure we are increasing our market share and gaining user adoption while maintaining a financially healthy and sustainable business we will track the following success metrics.