[parasubvert]

Subscriptions do not imply SaaS, though Wall Street often equates the two. It’s just a different licensing model that’s replacig the up-front perpetual license + 25% annual maintenance that is the old school enterprise software model.

The majority of that subscription revenue (they make this clear in other statements in the S-1) is enterprise deals running Elasticsearch & Friends on enterprise datacentres or clouds where Elastic isn’t providing a managed service - they’re providing traditional enterprise software support.

This isn’t unique to Elastic. Splunk, Pivotal, Mongo, MuleSoft, all are similar. Wall Street mostly cares about the revenue model, but there’s a nuance to it.