Appian (APPN 0.34%) is the leading pure-play, low-code software company on the market, but that doesn't mean it's without competition. It faces off against Pegasystems, newer companies, and enterprise tech giants like Microsoft and Salesforce.

In this Backstage Pass interview, aired on Nov. 24, Appian CEO Matt Calkins explains how Appian distinguishes itself from tech heavyweights like Microsoft.

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Jeremy Bowman: I think you shared with us before, I think you guys are at a 99 percent customer retention rate over the last year or so, and strong net revenue retention, numbers as well. And I think if I'm correct, we're coming off your third quarter, 36 percent cloud subscription revenue growth. Maybe you can talk to us about a couple of highlights from their recent quarter.

Matt Calkins: Yeah, that'd be great. The highlights from our recent quarter include steady solid growth, and Appian has been in this range for a few years. I'm pleased to see us growing through all sorts of chaos in all directions. We just keep on notching good growth. We did really well in international and in federal. You would expect a good federal Q3. We had one, so I'm pleased with that. I'm delighted to see the interest in the Appian Community, so usage of that community is way up, not just the community edition, but membership in the Appian Community, which is like a website where people ask and answer questions, and post job requests, and that sort of thing -- a lot of interest in that.

Then the most important thing, of course, by far, in the past quarter, is that we've recently made an acquisition. We're merging that into our platform, and we're coming up with a new vision for what our consolidated market space should be. We have long suffered in this industry from a lack of coherence, which is to say that our industry doesn't have a clear name, it doesn't have a clear set of expectations, it's not clear to customers what they should be buying when they buy a product in our industry. We need that coherence back. By creating a combined vision, a clear basic conception of what you should expect from a change engine, from a low-code platform, we're going to simplify this industry so that it is more accessible to our customers.

At the same time, we've got large vendors competing in our space, and their product is probably not a like-for-like comparison to our product. After all we're the top rated, we've got the most customer satisfaction, we've been here the longest, we're most committed and focused on this industry. But when a large company, like say Microsoft or Salesforce comes into this space and declares that they now sell it, that has two effects. One, they're going to scoop up some of their own customer base and make them into their own vendors and if, making them into their own customers in this new industry. Then secondly, they're going to raise the profile of the industry itself. Whether you call that low-code, or automation, or whatever word you are going to use, the profile is going up. We need to capitalize on that profile raising moment.

When an industry rises, there's a place for a stack vendor and there's a place for a quality leader. And so we expect that tide to raise our boat the same way it raises their boat. We just need to leverage that, we need to be sure that our success with customers is well-understood by the market. And so we're going to keep boosting our profile, and growing our community, and getting out in front in the press, and being sure that we're recognized as the originator, the pioneer in this new low-code space. Being the ideal leader, having a clear vision, and having the components that form that complete vision, putting it together before our competitors do, that's really essential.

Jeremy Bowman: Yeah, that's interesting. I know you mentioned in the Investor Conference some of your competitors, large enterprise tech firms, Microsoft, Salesforce. Is low-code attracting some new companies, new competitors like those now? Is that what's happening?

Matt Calkins: Yeah, it definitely is. It's becoming more popular. Low-code is something a lot of people have heard of, and they hadn't a few years ago. My theory as to why you've heard of it now and you hadn't then, is because the pandemic and the chaos over the last few years have forced businesses to focus on change, and in low-code they found an industry that was capable of helping them. Because of that help, low-code's profile has risen.

It's also an idea whose time has come, it just make sense. We've got exponentially more demand for applications in the world and we don't have exponentially more developers, so we're going to come to a junction where it's simply necessary to have more efficiency which is to say get more apps per developer than we've gotten in the past, and I think that we're reaching that. This is an idea that matches 2021 or the future. It's incumbent on us now to handle the new wave of interest and grow in a different way.

As you may be aware, Appian has been spent a steady grower throughout its history. We're a bootstrap, we took almost no external money on our way to our IPO. I've been running the company for 20 years. In fact, all four of the founders are still here after 20 years. We're friends and we work together. It's an unusual thing in a tech firm. Appian has been very good at being a steady, self-driven, customer funded, and success-validated company. We're entering a new market in which our competitors are not success-validated. They're in our market because they've got a big reputation, a lot of money to spend, and their product may not even be competitive with ours, but they'll still win a lot of customers because they have captive customers. We're fighting an asymmetric battle now. There's room for a company like this in this asymmetric environment. This is a complex industry, feature requests are strong, we have great features to match those requests. There's going to be a place for Appian in this industry. We just need to be sure that we're known to as many customers as possible so that we can benefit from every time one of these big tech firms says the word "low-code" or "automation."