Attention Snowflake Customers! You've Got Leverage

Updated: Jan 14

On the heels of Snowflake’s recent blockbuster IPO earlier this month, we’ve observed an uptick in competitive pricing and attractive contract terms in Snowflake renewals. It is likely that the data warehouse vendor’s sales reps are under pressure to close deals and add new revenue before their upcoming Q3 end (10/31) and further prove to Wall Street that Snowflake is a hot company ripe for investment. With sales reps eager to generate revenue, we urge buyers to take advantage of this rare opportunity to achieve better pricing and terms.

Specifically, we advise Snowflake customers to:

  • Exploit their “Rollover Capacity” rights to execute a new deal now. We have seen clients successfully push their Capacity discounts as much as 10% deeper than the standard level.

  • Request more protective language in your contract. Several of our clients have been recently awarded discount locks for up to two terms (terms are typically one year each).

  • Ask for ‘free capacity credits’ for signing a renewal with Snowflake, as some of our clients have successfully done.

The cloud-based data warehouse-as-a-service space is becoming increasingly competitive and is expected to balloon from $1.4B in 2019 to $23.8B by 2030. Amazon’s Redshift, Google’s BigQuery and Microsoft’s Azure Synapse are attempting to follow Snowflake’s lead in offering customers a way to access their big data across multiple public cloud platforms. Snowflake appears to be working hard to maintain its powerhouse position, expanding its core offering to provide a unified big data querying, governance, and services suite. Its revenue grew 174% to $265M in FY2019 and the company has consistently improved its gross margins.

To learn more about building leverage to add value and reduce costs in your next deal, download our recent blog titled “Leverage: The Key to Every Deal” or contact your ClearEdge account representative.

Roisin Henry is an Analyst at ClearEdge focused on Snowflake, Akamai, and telecom service providers.