SERENA SOFTWARE INC, S-8, 1999-08-04

SERENA SOFTWARE INC
S-8, 1999-08-04
PREPACKAGED SOFTWARE

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AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON AUGUST 4, 1999
REGISTRATION NO. 333-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------

FORM S-8/S-3
REGISTRATION STATEMENT
(INCLUDING REGISTRATION OF SHARES FOR RESALE BY MEANS OF A FORM S-3 PROSPECTUS)
UNDER
THE SECURITIES ACT OF 1933
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SERENA SOFTWARE, INC.
(Exact name of Registrant as specified in its charter)

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<S> <C>
DELAWARE 94-2669809
(State of incorporation) (I.R.S. Employer Identification
Number)
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500 AIRPORT BOULEVARD, 2ND FLOOR
BURLINGAME, CALIFORNIA 94010-1904
(Address of principal executive offices, including zip code)
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AMENDED AND RESTATED 1997 STOCK OPTION AND INCENTIVE PLAN
1999 EMPLOYEE STOCK PURCHASE PLAN
1999 DIRECTOR OPTION PLAN
(Full title of the plan)
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RICHARD A. DOERR
PRESIDENT AND CHIEF EXECUTIVE OFFICER
SERENA SOFTWARE, INC.
500 AIRPORT BOULEVARD, 2ND FLOOR
BURLINGAME, CALIFORNIA 94010-1904
(650) 696-1800
(Name, address and telephone number, including area code, of agent for service)
--------------------------

COPY TO:

DOUGLAS H. COLLOM, ESQ.
WILSON SONSINI GOODRICH & ROSATI
PROFESSIONAL CORPORATION
650 PAGE MILL ROAD
PALO ALTO, CA 94304
(650) 493-9300
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CALCULATION OF REGISTRATION FEE

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PROPOSED PROPOSED
MAXIMUM AMOUNT MAXIMUM MAXIMUM
TO BE OFFERING PRICE AGGREGATE AMOUNT OF
TITLE OF SECURITIES TO BE REGISTERED REGISTERED(1) PER SHARE OFFERING PRICE REGISTRATION FEE
<S> <C> <C> <C> <C>
Common Stock, $0.001 par value
Issued pursuant to restricted stock
purchase agreements under Amended
and Restated 1997 Stock Option and
Incentive Plan...................... 1,986,001 shares $9.06250(2) $17,998,134.06 $ 5,003.48
To be issued under Amended and
Restated 1997 Stock Option and
Incentive Plan...................... 2,563,999 shares $7.57128(3) $19,412,756.88 $ 5,396.74
To be issued under 1999 Employee Stock
Purchase Plan....................... 225,000 shares $7.70313(4) $ 1,733,203.13 $ 481.83
To be issued under 1999 Director
Option Plan......................... 150,000 shares $9.06250(5) $ 1,359,375.00 $ 377.91
TOTAL............................... 4,925,000 shares $40,503,469.06 $11,259.96
</TABLE>

(1) For the sole purpose of calculating the registration fee, the number of
shares to be registered under this Registration Statement has been broken
down into four subtotals.

(2) Computed in accordance with Rule 457(c) under the Securities Act. Such
computation is based on the average high and low sales prices of SERENA
common stock as reported by the Nasdaq National Market on August 3, 1999.

(3) Computed in accordance with Rule 457(h) and Rule 457(c) under the Securities
Act. Such computation is based on the weighted average exercise price of
$6.25 per share covering 1,359,461 outstanding options and the estimated
exercise price of $9.06250 covering 1,204,538 authorized but unissued shares
under our 1997 Stock Option and Incentive Plan. The estimated exercise price
of $9.06250 per share was computed in accordance with Rule 457(h) by
averaging the high and low prices of a share of SERENA Common Stock as
reported by the Nasdaq National Market on August 3, 1999.

(4) The exercise price of $7.70313 per share, computed in accordance with Rule
457(h) under the Securities Act, is 85% of the closing price of a share of
SERENA common stock as reported by the Nasdaq National Market on August 3,
1999, the current enrollment date. Pursuant to Section 2(n) of the 1999
Employee Stock Purchase Plan (Exhibit 10.3A) hereto, shares are sold at 85%
of the lesser of the fair market value of such shares on the enrollment date
or on the exercise date.

(5) Computed in accordance with Rule 457(h). Such computation is based on the
estimated exercise price of $9.06250 per share covering 150,000 authorized
but unissued shares under our 1999 Director Option Plan. The estimated
exercise price of $9.06250 per share was computed in accordance with Rule
457(h) by averaging the high and low prices of a share of SERENA Common
Stock as reported by the Nasdaq National Market on August 3, 1999.

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PROSPECTUS

[LOGO]

1,986,001 SHARES
COMMON STOCK
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This prospectus relates to 1,986,001 shares of SERENA common stock which may
be offered from time to time by selling stockholders identified on page for
their own accounts. It is anticipated that the selling stockholders will offer
shares for sale at prevailing prices on the Nasdaq National Market on the date
of sale. SERENA will receive no part of the proceeds from sales made hereunder.
The selling stockholders will bear all sales commissions and similar expenses.
Any other expenses incurred by SERENA in connection with the registration and
offering and not borne by the selling stockholders will be borne by SERENA. None
of the shares offered pursuant to this prospectus have been registered prior to
the filing of the registration statement of which this prospectus is a part.

Our common stock is traded on the Nasdaq National Market under the Nasdaq
Symbol SRNA. On August 3, 1999, the last reported sale price of the common stock
was $8.6875 per share.

THE COMMON STOCK OFFERED HEREBY INVOLVES A HIGH DEGREE OF RISK. SEE "RISK
FACTORS," BEGINNING ON PAGE 5.

These securities have not been approved or disapproved by the SEC or any
state securities commission nor has the SEC or any state securities commission
passed upon the accuracy or adequacy of this prospectus. Any representation to
the contrary is a criminal offense.

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The date of this prospectus is August 4, 1999
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TABLE OF CONTENTS
PROSPECTUS

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PAGE
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ADDITIONAL INFORMATION ABOUT SERENA........................................................................ 3

INCORPORATION OF CERTAIN INFORMATION BY REFERENCE.......................................................... 3

SERENA..................................................................................................... 4

RISK FACTORS............................................................................................... 5

FORWARD-LOOKING STATEMENTS................................................................................. 16

USE OF PROCEEDS............................................................................................ 16

SELLING SECURITY HOLDERS................................................................................... 17

PLAN OF DISTRIBUTION....................................................................................... 19

INDEMNIFICATION OF DIRECTORS AND OFFICERS.................................................................. 21

EXPERTS.................................................................................................... 21
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YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED IN THIS PROSPECTUS. WE
HAVE NOT AUTHORIZED ANYONE TO PROVIDE YOU WITH INFORMATION DIFFERENT FROM THAT
CONTAINED IN THIS PROSPECTUS. THE SELLING STOCKHOLDERS ARE OFFERING TO SELL, AND
SEEKING OFFERS TO BUY, SHARES OF SERENA COMMON STOCK ONLY IN JURISDICTIONS WHERE
OFFERS AND SALES ARE PERMITTED. THE INFORMATION CONTAINED IN THIS PROSPECTUS IS
ACCURATE ONLY AS OF THE DATE OF THIS PROSPECTUS, REGARDLESS OF THE TIME OF
DELIVERY OF THIS PROSPECTUS OR OF ANY SALE OF THE SHARES. IN THIS PROSPECTUS,
THE "COMPANY," "SERENA," "WE," "US" AND "OUR" REFER TO SERENA SOFTWARE, INC.

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ADDITIONAL INFORMATION ABOUT SERENA

We are subject to the informational reporting requirements of the SEC
Exchange Act, and we file reports, proxy statements and other information with
the SEC. You may read and copy any document we file at the SEC's public
reference rooms in Washington, D.C., New York, New York and Chicago, Illinois.
Please call the SEC at 1-800-SEC-0330 for further information about the public
reference rooms. Our SEC filings are also available to the public from our Web
site at http://www.serena.com or the SEC's Web site at http://www.sec.gov.
Information contained on SERENA's Web site does not constitute part of this
prospectus.

This prospectus contains information concerning SERENA and the sale of our
common stock by the selling stockholders, but does not contain all the
information set forth in the registration statement on which SERENA has filed
with the SEC under the Securities Act. Statements made in this prospectus as to
the contents of any referenced contract, agreement or other document are not
necessarily complete, and such statements are qualified by reference to the
applicable contract, agreement or other document. The registration statement,
including various exhibits, may be obtained upon payment of the fee prescribed
by the SEC, or may be examined without charge at the SEC's office in Washington,
D.C.

INCORPORATION OF CERTAIN INFORMATION BY REFERENCE

There are hereby incorporated by reference in this prospectus the following
documents and information heretofore filed with the SEC.

(1) Our Annual Report on Form 10-K for the fiscal year ended January 31,
1999.

(2) Our Quarterly Report on Form 10-Q for the quarter ended April 30,
1999, filed pursuant to Section 13 of the Exchange Act.

(3) The description of our common stock contained in the Registration
Statement on Form 8-A filed January 22, 1999 pursuant to Section 12(g) of
the Exchange Act.

All documents subsequently filed by SERENA pursuant to Sections 13(a),
13(c), 14 and 15(d) of the Exchange Act, prior to the filing of a post-effective
amendment which indicates that all securities registered have been sold or which
deregisters all securities then remaining unsold, shall be deemed to be
incorporated by reference in this registration statement and to be part hereof
from the date of filing of such documents.

Any statement contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for purposes of the registration statement or this prospectus to the extent that
a statement contained herein, in a prospectus supplement or in any other
document subsequently filed with the SEC which also is or is deemed to be
incorporated by reference herein modifies or supersedes such statement. Any such
statement so modified or superseded shall not be deemed, except as so modified
or superseded, to constitute a part of the registration statement or this
prospectus.

We will provide without charge to each person to whom a copy of this
prospectus is delivered, upon written or oral request of any such person, a copy
of any and all of the information that has been or may be incorporated by
reference in this prospectus. Requests for such copies should be directed to
Vita A. Strimaitis, General Counsel, at our headquarters at 500 Airport
Boulevard, 2nd Floor, Burlingame, California 94010-1904. Our telephone number at
that location is (650) 696-1800.

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SERENA

We are a leading provider of software change management, or SCM, products
and services used to manage and control software change for organizations whose
business operations are dependent on managing information technology, or IT. We
have developed highly effective solutions for managing software change that
enable our customers to improve their return on IT investments by increasing
programmer productivity and reducing application development and IT
infrastructure maintenance costs. A key challenge for IT managers is managing
software change throughout the business organization, including new version
releases, "bug fixes," upgrades and application introductions. Our products help
IT managers manage software changes to applications by automating the software
application life cycle. IT managers use our products to track software changes
during the software application design and development process, manage separate
programming teams that are concurrently developing and enhancing applications,
and oversee the deployment of software applications. Any software change, if not
managed effectively, has the potential to cause system outages or corrupt data
which can result in disruption and lost business.

Successful management of IT infrastructure requires managing rapid and
unpredictable technological change within increasingly complex and diverse
computing environments. Business issues such as competitive pressures, short
time-to-market windows, regulatory changes and Year 2000 and European Monetary
Union conversions introduce additional requirements for managing software
change. Our products are designed to assist businesses in addressing these types
of complexities by automating the management of changes to software
applications.

Our FULL.CYCLE MAINFRAME product suite creates an IT environment that
improves product consistency, enhances software integrity, protects valuable
software assets and facilitates concurrent application development efforts by
separate programming teams. The FULL.CYCLE MAINFRAME product suite is designed
to support the mainframe platform and, to date, all of our software license
revenue has been attributable to the sale of these mainframe products.

We intend to maintain our technology leadership in providing SCM solutions
for the mainframe and to use the proprietary technology and expertise
incorporated in our FULL.CYCLE MAINFRAME products to develop our SCM product
suite for the desktop, FULL.CYCLE DESKTOP. This will enable us to provide
customers with a complete SCM solution across the IT organization. We released
an initial version of our first desktop product, DETECT+RESOLVE, in December
1998. Managing software change on the mainframe and desktop platforms have many
similarities. These similarities include the need to develop and enforce
consistent software change policies and procedures and a process to control all
types of software changes. Software changes occur in all phases of the
application life cycle, from the initial business request through development,
testing and production and into maintenance and support phases.

We were incorporated in California in 1980 and reincorporated in Delaware in
1998. Our headquarters are located at 500 Airport Boulevard, 2nd Floor,
Burlingame, California 94010-1904. Our telephone number at that location is
(650) 696-1800.

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RISK FACTORS

PROSPECTIVE INVESTORS IN THE SHARES OF COMMON STOCK OFFERED HEREBY SHOULD
CAREFULLY CONSIDER THE FOLLOWING RISK FACTORS, IN ADDITION TO THE OTHER
INFORMATION CONTAINED IN THIS PROSPECTUS OR IN DOCUMENTS INCORPORATED BY
REFERENCE HEREIN. THE RISK FACTORS SET FORTH HEREIN REFLECT THOSE RISKS KNOWN TO
OUR MANAGEMENT AS OF THE DATE OF THE FILING OF THIS REGISTRATION STATEMENT ON
FORM S-8/S-3, AND WHICH MANAGEMENT BELIEVES COULD BE MATERIAL TO OUR BUSINESS,
OPERATING RESULTS AND FINANCIAL CONDITION. SUCH FACTORS MAY CHANGE OVER TIME AND
MAY DIFFER MATERIALLY FROM THE RISK FACTORS LISTED HEREIN. PROSPECTIVE INVESTORS
ARE CAUTIONED TO REVIEW, IN ADDITION TO THE RISK FACTORS SET FORTH HEREIN, THE
RISK FACTORS CONTAINED IN "MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS" CONTAINED IN OUR MOST RECENT ANNUAL REPORT
ON FORM 10-K OR QUARTERLY REPORT ON FORM 10-Q AS WELL AS THE ADDITIONAL
INFORMATION CONTAINED IN SUCH REPORTS AND OUR OTHER FILINGS UNDER THE EXCHANGE
ACT.

THERE ARE MANY FACTORS, INCLUDING SOME BEYOND OUR CONTROL, THAT MAY CAUSE
FLUCTUATIONS IN OUR QUARTERLY OPERATING RESULTS.

Our quarterly operating results have varied greatly in the past and may vary
greatly in the future depending upon a number of factors described below and
elsewhere in this "Risk Factor" section of this prospectus, including many that
are beyond our control. As a result, we believe that quarter-to-quarter
comparisons of our financial results are not necessarily meaningful, and you
should not rely on them as an indication of our future performance. Factors that
may materially affect our quarterly operating results include the following, as
well as others discussed in this prospectus:

- The size, timing and contractual terms of large orders for our software
products

- The budgeting cycles of our customers and potential customers and their
willingness to invest in new SCM solutions or upgrade their existing
solutions

- Market demand for our software products and services, including our
desktop products that are currently under development

- Our ability to develop and introduce on a timely basis and to market new
and enhanced versions of our software, including our desktop products
currently under development

- Seasonal trends in customer purchasing patterns

- Activities by our competitors, including releases of new software
products, changes in pricing policies and acquisitions or strategic
partnership activities

- Any downturn in our customers' businesses, in the domestic economy or in
international economies where our customers do substantial business

- Changes in the mix of software products and services sold by us, including
the mix between higher margin software products and lower margin
maintenance and services and the percentage of software products sold
which require us to pay a sublicense fee to a third party

- Our ability to hire, integrate and retain technical, sales, marketing and
professional services personnel

- Risks associated with our planned international expansion, including
longer sale cycles and currency fluctuations

- Changes in our pricing policies resulting from competitive pressures or
other factors

- Cancellation of maintenance agreements by customers or any significant
decrease in the percentage of customers who renew their maintenance
agreements with us

- Software defects and other product quality problems

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Our software license revenue in any quarter depends on orders booked and
shipped in the last month, weeks or days of that quarter. At the end of each
quarter, we typically have either minimal or no backlog of orders for the
subsequent quarter. If a large number of orders or several large orders do not
occur or are deferred, our revenue in that quarter could be substantially
reduced. This would materially adversely affect our operating results and could
impair our business in future periods. Because we do not know when, or if, our
potential customers will place orders and finalize contracts, we cannot
accurately predict our revenue and operating results for future quarters.

Historically, a majority of our revenue has been attributable to the
licenses of our FULL.CYCLE MAINFRAME software products. Changes in the mix of
software products and services sold by us, including the mix between higher
margin software products and lower margin maintenance and services, could
materially affect our operating results for future quarters as could the
percentage of software products sold which require us to pay a sublicense fee to
a third party.

SEASONAL TRENDS IN SALES OF OUR SOFTWARE PRODUCTS MAY AFFECT OUR QUARTERLY
OPERATING RESULTS.

We have experienced and expect to continue to experience seasonality in
sales of our software products. These seasonal trends materially affect our
quarter-to-quarter operating results. Revenue and operating results in our
quarter ending January 31 are typically higher relative to our other quarters,
because many customers make purchase decisions based on their calendar year-end
budgeting requirements. In addition, our January quarter tends to reflect the
effect of the incentive compensation structure for our sales organization, which
is based on satisfaction of fiscal year-end quotas. As a result, we have
historically experienced a substantial decline in revenue in the first quarter
of each fiscal year relative to the preceding quarter. We are also currently
attempting to expand our presence in international markets, particularly in
Europe. We expect our quarter ending October 31 to reflect the effects of summer
slowing of international business activity and spending activity generally
associated with that time of year, particularly in Europe. To the extent that
our revenue in Europe or other parts of the world increase in future periods, we
expect our period-to-period revenues to reflect any seasonal buying patterns in
these markets.

WE EXPECT THAT OUR OPERATING EXPENSES WILL INCREASE SUBSTANTIALLY IN THE FUTURE
AND THESE INCREASED EXPENSES MAY ADVERSELY AFFECT OUR FUTURE OPERATING RESULTS
AND FINANCIAL CONDITION.

Although SERENA has been profitable in recent years, we may not remain
profitable on a quarterly or annual basis in the future. We anticipate that our
expenses will increase substantially in the foreseeable future as we:

- Increase our sales and marketing activities, including expanding our
United States and international direct sales forces and extending our
telesales efforts

- Develop our technology, including our FULL.CYCLE DESKTOP suite of SCM
products for the desktop platform

- Broaden our professional services offerings and delivery capabilities

- Expand our distribution channels

- Pursue strategic relationships and acquisitions

With these additional expenses, in order to maintain our current levels of
profitability, we will be required to increase our revenue correspondingly. Any
failure to significantly increase our revenue as we implement our product,
service and distribution strategies would materially adversely affect our
business, quarterly and annual operating results and financial condition.
Although our revenue has grown in recent years, we do not believe that we will
maintain this rate of revenue growth. In addition, we may not experience any
revenue growth in the future, and our revenue could in fact decline. Our efforts
to expand

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our software product suites, sales and marketing activities, direct and indirect
distribution channels and professional service offerings and to pursue strategic
relationships or acquisitions may not succeed or may prove more expensive than
we currently anticipate. As a result, we cannot predict our future operating
results with any degree of certainty.

OUR FUTURE REVENUE IS SUBSTANTIALLY DEPENDENT UPON OUR INSTALLED CUSTOMERS
RENEWING MAINTENANCE AGREEMENTS FOR OUR PRODUCTS AND LICENSING ADDITIONAL SERENA
SCM PRODUCTS; OUR FUTURE PROFESSIONAL SERVICE AND MAINTENANCE REVENUE IS
DEPENDENT ON FUTURE SALES OF OUR SOFTWARE PRODUCTS.

We depend on our installed customer base for future revenues from
maintenance renewal fees and licenses of additional SCM products. If our
customers do not purchase additional products or cancel or fail to renew their
maintenance agreements, this could materially adversely affect our business and
future quarterly and annual operating results. The terms of our standard license
arrangements provide for a one-time license fee and a prepayment of one year of
software maintenance and support fees. The maintenance agreements are renewable
annually at the option of the customers and there are no minimum payment
obligations or obligations to license additional software. Therefore, our
current customers may not necessarily generate significant maintenance revenue
in future periods. In addition, our customers may not necessarily purchase
additional products, upgrades or professional services. Our professional service
revenue and maintenance revenue are also dependent upon the continued use of
these services by our installed customer base. Any downturn in our software
license revenue would have a negative impact on the growth of our professional
service revenue and maintenance revenue in future quarters.

WE HAVE RELIED AND EXPECT TO CONTINUE TO RELY ON SALES OF OUR FULL.CYCLE
MAINFRAME PRODUCTS FOR OUR REVENUE.

Historically, all of our software license revenue has resulted from the sale
of our FULL.CYCLE MAINFRAME products. Any factors adversely affecting the
pricing of, demand for or market acceptance of our FULL.CYCLE MAINFRAME
products, such as competition or technological change, could materially
adversely affect our business and quarterly and annual operating results. In
particular, CHANGE MAN and COMPAREX, two of our FULL.CYCLE MAINFRAME products,
have been responsible for a substantial majority of our revenue. We expect that
these products will continue to account for a large portion of our software
license revenue for the foreseeable future. Our future operating results depend
on the continued market acceptance of our FULL.CYCLE MAINFRAME products,
including future enhancements.

IF THE SCM MARKET DOES NOT EVOLVE AS WE ANTICIPATE, OUR BUSINESS WILL BE
ADVERSELY AFFECTED.

If we fail to properly assess and address the SCM market or if our products
and services fail to achieve market acceptance for any reason, our business and
quarterly and annual operating results would be materially adversely affected.
The SCM market is in an early stage of development. IT organizations have
traditionally addressed SCM needs internally and have only recently become aware
of the benefits of third-party SCM solutions as their SCM requirements have
become more complex. Since the market for our products is still evolving, it is
difficult to assess the competitive environment or the size of the market that
may develop. Our future financial performance will depend in large part on the
continued growth in the number of businesses adopting third-party SCM products
and the expansion of their use on a company-wide basis. The SCM market for
third-party products may grow more slowly than we anticipate. In addition,
technologies, customer requirements and industry standards may change rapidly.
If we cannot improve or augment our products as rapidly as existing
technologies, customer requirements and industry standards evolve, our products
or services could become obsolete. The introduction of new or technologically
superior products by competitors could also make our products less competitive
or obsolete. As a result of any of these factors, our position in existing
markets or potential markets could be eroded.

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OUR BUSINESS IS DEPENDENT ON THE CONTINUED MARKET FOR IBM AND IBM-COMPATIBLE
MAINFRAMES.

We are substantially dependent upon the continued use and acceptance of IBM
and IBM-compatible mainframes and the growth of this market. If the role of the
mainframe does not increase as we anticipate, or if it in any way decreases,
this would materially adversely affect our business, future quarterly and annual
operating results and financial condition. Additionally, if there is a wide
acceptance of other platforms or if new platforms emerge that provide enhanced
enterprise server capabilities, our business and future operating results may be
materially adversely affected. Substantially all of our software license revenue
to date has been attributable to sales of our FULL.CYCLE MAINFRAME products. We
expect that, for the foreseeable future, substantially all of our software
license revenue will continue to come from sales of our mainframe products. As a
result, future sales of our existing products and associated maintenance revenue
and professional service revenue will depend on continued use of mainframes.
Recently there has been a trend away from the use of centralized mainframes in
enterprise computing environments to more decentralized client/server networks.
Although some IT organizations are using mainframes as large enterprise servers,
this practice is relatively new and still emerging and may not continue.

OUR INTRODUCTION OF SERENA SCM PRODUCTS FOR THE DESKTOP MAY NOT BE SUCCESSFUL.

We are currently developing our FULL.CYCLE DESKTOP product suite which is
designed to support the desktop platform. If we do not successfully develop,
market, sell and support our FULL.CYCLE DESKTOP products, this would materially
adversely affect our business and our future quarterly and annual operating
results. Historically, all of our products have been designed for the mainframe
platform, and all of our software license revenue, maintenance revenue and
professional services revenue to date have been attributable to licenses for
these mainframe products. We do not have experience developing, marketing,
selling or supporting desktop products. Developing, marketing and selling our
desktop products will require significant resources that we may not have. Our
sales and marketing organizations have historically focused exclusively on sales
of our products for the mainframe and have limited experience marketing and
selling desktop products. Additionally, we do not have any experience in
providing support services for desktop products. Competition for experienced
software engineers, sales personnel and support staff is intense and if we fail
to attract qualified personnel this would impair our ability to support our
FULL.CYCLE DESKTOP products. Many of our competitors have substantially greater
experience providing desktop compatible software products than we do, and many
also have significantly greater financial and organizational resources.

WE MAY EXPERIENCE DELAYS IN DEVELOPING OUR PRODUCTS WHICH COULD ADVERSELY AFFECT
OUR BUSINESS.

If we are unable, for technological or other reasons, to develop and
introduce new and improved products in a timely manner, this could materially
adversely affect our business and future quarterly and annual operating results.
We have experienced product development delays in new version and update
releases in the past and may experience similar or more significant product
delays in the future. To date, none of these delays has materially affected our
business. Difficulties in product development could delay or prevent the
successful introduction or marketing of new or improved products or the delivery
of new versions of our products to our customers. In particular, we may
experience delays in introducing our FULL.CYCLE DESKTOP product suite. While we
anticipate releasing initial versions of our FULL.CYCLE DESKTOP products, other
than DETECT+RESOLVE which we released in December 1998, before the end of
calendar 1999, any delay in releasing our new desktop products, for whatever
reason, would impair our revenue growth.

WE HAVE EXPERIENCED SIGNIFICANT GROWTH IN OUR BUSINESS IN RECENT PERIODS AND OUR
ABILITY TO MANAGE THIS GROWTH AND ANY FUTURE GROWTH WILL AFFECT OUR BUSINESS.

Our ability to compete effectively and to manage our recent growth, any
future growth and our future quarterly and annual operating results will depend
in part on our ability to implement and expand

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operational, customer support and financial control systems and to train and
manage our employees. We may not be able to augment or improve existing systems
and controls or implement new systems and controls in response to future growth,
if any. Any failure to manage growth could materially adversely affect our
business. Since the beginning of fiscal 1998 we have significantly expanded our
sales, marketing and professional service activities. This expansion included
our September 1998 acquisition of Optima software which significantly increased
the size of our sales, marketing and professional service organizations. This
growth has resulted, and any future growth will result, in new and increased
responsibilities for management personnel.

WE WILL NEED TO EXPAND OUR DISTRIBUTION CHANNELS IN ORDER TO EXPAND OUR BUSINESS
AND A NUMBER OF FACTORS MAY HINDER OUR ABILITY TO ACCOMPLISH THIS GOAL.

If we fail to significantly expand our direct sales and telesales force, our
ability to sell our products into new markets and to increase our product
penetration into our existing markets will be impaired. Failure to expand our
distribution channels through any of these means could materially adversely
affect our business and our future quarterly and annual operating results. In
addition, our ability to achieve revenue growth in future periods will be
heavily dependent on our success in recruiting and training sufficient direct
sales personnel. We are planning to significantly expand our direct sales
efforts in North America and Europe and while we are investing, and plan to
continue to invest, substantial resources on this expansion, we have at times
experienced, and expect to continue to experience, difficulty in recruiting and
retaining qualified direct sales personnel. In addition to expanding our direct
sales efforts, we are also currently investing, and we intend to continue to
invest, substantial resources in selling our products through telesales
personnel. We also intend to extend our distribution channels by partnering with
leading helpdesk management, software distribution application and system
framework providers and may also attempt to develop additional sales and
marketing channels through system integrators, original equipment manufacturers
and other partners.

WE WILL NEED TO EXPAND OUR PROFESSIONAL SERVICES ORGANIZATION IN ORDER TO EXPAND
OUR BUSINESS AND A NUMBER OF FACTORS MAY HINDER OUR ABILITY TO ACCOMPLISH THIS
GOAL.

Our existing professional services and customer support organizations may
not be sufficient to manage any future growth in our business. The failure to
expand our professional services and customer support organizations or to
integrate Optima's professional services personnel into our professional
services organization could materially adversely affect our business. While we
intend to significantly expand our professional services and customer support
organizations, including providing these services for both desktop and mainframe
applications and systems, we may not be able to do so. Competition for
additional qualified technical personnel to perform these services is intense.

We believe that providing high quality consulting, training, customer
support and education is essential to maintaining our competitive position. If
we are unable to provide comprehensive consulting and support services to our
existing and prospective customers, this may materially adversely affect our
business and ability to sell our products. Consulting services and customer
support are critical to our future success because the market for third party
SCM solutions is still evolving, and many organizations have limited experience
using third party SCM solutions. Customers have only recently begun to look to
third party providers for SCM solutions as the complexity of computer networks
and number of applications has increased.

WE INTEND TO EXPAND OUR INTERNATIONAL OPERATIONS AND MAY ENCOUNTER A NUMBER OF
PROBLEMS IN DOING SO; THERE ARE ALSO A NUMBER OF FACTORS ASSOCIATED WITH
INTERNATIONAL OPERATIONS THAT COULD ADVERSELY AFFECT OUR BUSINESS.

EXPANSION OF INTERNATIONAL OPERATIONS. We intend to expand the scope of our
international operations and currently have subsidiaries in the United Kingdom
and in Germany. If we are unable to expand our

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<PAGE>
international operations successfully and in a timely manner, this could
materially adversely affect our business and quarterly and annual operating
results. Our continued growth and profitability will require continued expansion
of our international operations, particularly in Europe. In addition, in
calendar 1999, we intend to open additional international offices, including at
least one additional European office. We have only limited experience in
marketing, selling and supporting our products internationally. Additionally, we
do not have any experience in developing foreign language versions of our
products. Such development may be more difficult or take longer than we
anticipate. We may not be able to successfully market, sell, deliver and support
our products internationally.

RISKS OF INTERNATIONAL OPERATIONS. Our international revenue is
attributable principally to our European operations. Our international
operations are, and any expanded international operations will be, subject to a
variety of risks associated with conducting business internationally that could
materially adversely affect our business and future quarterly and annual
operating results, including the following:

- Difficulties in staffing and managing international operations

- Problems in collecting accounts receivable

- Longer payment cycles

- Fluctuations in currency exchange rates

- Seasonal reductions in business activity during the summer months in
Europe and certain other parts of the world

- Recessionary environments in foreign economies

- Increases in tariffs, duties, price controls or other restrictions on
foreign currencies or trade barriers imposed by foreign countries

FLUCTUATIONS IN THE VALUE OF FOREIGN CURRENCIES COULD RESULT IN CURRENCY
TRANSACTION LOSSES FOR SERENA.

A majority of our international business is conducted in foreign currencies,
principally the British pound. Fluctuations in the value of foreign currencies
relative to the U.S. dollar have caused and will continue to cause currency
transaction gains and losses. We cannot predict the effect of exchange rate
fluctuations upon future quarterly and annual operating results. We may
experience currency losses in the future. To date, we have not adopted a hedging
program to protect SERENA from risks associated with foreign currency
fluctuations.

SERENA IS SUBJECT TO INTENSE COMPETITION IN THE SCM INDUSTRY AND WE EXPECT TO
FACE INCREASED COMPETITION IN THE FUTURE, INCLUDING COMPETITION IN THE SCM
DESKTOP MARKET.

We may not be able to compete successfully against current or future
competitors and such inability would materially adversely affect our business,
quarterly and annual operating results and financial condition. The market for
our products is highly competitive and diverse. Moreover, the technology for SCM
products may change rapidly. New products are frequently introduced, and
existing products are continually enhanced. Competition may also result in
changes in pricing policies by SERENA or our competitors which could materially
adversely affect our business and future quarterly and annual operating results.
Competitors vary in size and in the scope and breadth of the products and
services that they offer. Many of our current and potential competitors have
greater financial, technical, marketing and other resources than we do. As a
result, they may be able to respond more quickly to new or emerging technologies
and changes in customer requirements. They may also be able to devote greater
resources to the development, promotion and sale of their products than we can.

10
<PAGE>
EXISTING COMPETITION. We currently face competition from a number of
sources, including:

- Customers' internal IT departments

- Providers of SCM products that compete directly with CHANGE MAN and
COMPAREX such as Computer Associates, IBM and smaller private companies

- Providers of SCM application development programmer productivity and
system management products such as Compuware, IBM and smaller private
companies

FUTURE COMPETITION. We may face competition in the future from established
companies who have not previously entered the mainframe SCM market or from
emerging software companies. Barriers to entry in the software market are
relatively low. Increased competition may materially adversely affect our
business and future quarterly and annual operating results due to price
reductions, reduced gross margins and reduction in market share. Established
companies may not only develop their own mainframe SCM solutions, but they may
also acquire or establish cooperative relationships with our current
competitors, including cooperative relationships between large, established
companies and smaller private companies. Because larger companies have
significant financial and organizational resources available, they may be able
to quickly penetrate the mainframe SCM market through acquisitions or strategic
relationships and may be able to leverage the technology and expertise of
smaller companies and develop successful SCM products for the mainframe. We
expect that the software industry, in general, and providers of SCM solutions,
in particular, will continue to consolidate. It is possible that new competitors
or alliances among competitors may emerge and rapidly acquire significant market
share.

BUNDLING OR COMPATIBILITY RISKS. Our ability to sell our products also
depends, in part, on the compatibility of our products with other third party
products, particularly those provided by IBM. Developers of these third party
products may change their products so that they will no longer be compatible
with our products. These third party developers may also decide to bundle their
products with other SCM products for promotional purposes. If that were to
happen, our business and future quarterly and annual operating results may be
materially adversely affected as we may be priced out of the market or no longer
be able to offer commercially viable products.

COMPETITION IN THE DESKTOP SCM MARKET. We anticipate that we will also face
significant competition as we develop, market and sell our FULL.CYCLE DESKTOP
products. If we are unable to successfully penetrate the desktop SCM market, our
business and future quarterly and annual operating results will be materially
adversely affected. We do not have experience in developing, selling, marketing
or supporting desktop products since all of our products to date have been
designed to support the mainframe. Penetrating the existing desktop SCM market
will be difficult. Competitors in the desktop market include Merant, Microsoft,
Novadigm, Novell, Rational Software and other smaller private companies.

REDUCED CUSTOMER FOCUS AND SPENDING ON YEAR 2000 REMEDIATION AND EMU CONVERSION
COULD ADVERSELY AFFECT THE SALES OF CERTAIN OF OUR PRODUCTS; CUSTOMER USE OF OUR
PRODUCTS FOR YEAR 2000 AND EMU ISSUES MAY NOT LEAD TO INCREASED SALES OF OUR
OTHER PRODUCTS.

Our business may be adversely affected if customers focus less on Year 2000
remediation and European Monetary Unit, or EMU, conversion issues and sales of
our STARWARP and COMPAREX products decline as a result. We have derived a
portion of our recent software license revenue and professional services revenue
from products designed to help customers resolve SCM problems for specific
business issues such as those related to Year 2000 remediation and EMU
conversion. Our STARWARP product is our primary Year 2000 and EMU readiness
product. Certain customers have also licensed COMPAREX to assist them in testing
Year 2000 remediations and EMU conversions. Market acceptance of our products
and services will depend, in large part, on whether customers use our products
as part of their overall IT management strategy in addition to using them to
resolve SCM problems related to specific business issues. Market acceptance of
our products to address general IT business needs as well as to resolve specific
business issues, such as Year 2000 remediation or EMU conversion, is critical to
our business and

11
<PAGE>
future success. If customers do not expand their use of our products, implement
new software products introduced by us or do not use our related maintenance and
support services to address their general IT business requirements as well as
specific issues, this will materially adversely affect our business and our
ability to sell our products.

ANY DELAYS IN OUR NORMALLY LENGTHY SALES CYCLES COULD RESULT IN SIGNIFICANT
FLUCTUATIONS IN OUR QUARTERLY OPERATING RESULTS.

Our sales cycle typically takes six to 18 months to complete and varies from
product to product. Any delay in the sales cycle of a large license or a number
of smaller licenses could result in significant fluctuations in our quarterly
operating results. The length of the sales cycle may vary depending on a number
of factors over which we may have little or no control, including the size of a
potential transaction and the level of competition that we encounter in our
selling activities. Additionally, the emerging market for SCM products and
services contributes to the lengthy sales process in that during the sales cycle
we often have to teach potential customers about the use and benefits of our
products. In certain circumstances, we license our software to customers on a
trial basis to assist the customers in their evaluation of our products. Our
sales cycle can be further extended for product sales made through third party
distributors.

CERTAIN OF OUR PRODUCTS ARE LICENSED FROM THIRD PARTIES OR ARE JOINTLY-OWNED
WITH THIRD PARTIES; OUR FAILURE TO MAINTAIN THESE ARRANGEMENTS WITH THIRD
PARTIES COULD ADVERSELY AFFECT OUR BUSINESS.

STARTOOL AND STARWARP. We license our STARTOOL and STARWARP products on an
exclusive worldwide basis from A. Bruce Leland, one of our employees. The
termination of our licenses for the STARTOOL or STARWARP products would
materially adversely affect our business and quarterly and annual operating
results. Mr. Leland holds all proprietary rights with respect to the STARTOOL
and STARWARP technology, including any derivative works or enhancements of the
existing STARTOOL and STARWARP products. Our licenses for these products are
terminable by Mr. Leland upon 30 days notice in the event certain conditions
occur, including our failure to pay sublicense fees to Mr. Leland on a timely
basis or any other material breach by us of the license agreement. Should the
licenses for the STARTOOL and STARWARP products terminate, we may not be able to
replace these products which could materially adversely affect our business and
future quarterly and annual operating results.

DETECT+RESOLVE MAINFRAME. We share ownership rights in our DETECT+RESOLVE
MAINFRAME, previously SYNCTRAC, technology for mainframe platforms with High
Power Software. Although we have historically had primary responsibility for
marketing, licensing and supporting DETECT+RESOLVE MAINFRAME, High Power
Software has the ability to jointly direct these efforts. If in the future we
are unable to reach agreement with High Power Software on the direction or
evolution of the product, our ability to market or promote the product may be
compromised. This could have a material adverse effect on our business and
future quarterly and annual operating results.

OUR EXECUTIVE OFFICERS AND CERTAIN KEY PERSONNEL ARE CRITICAL TO OUR BUSINESS
AND SUCH OFFICERS AND KEY PERSONNEL MAY NOT REMAIN WITH SERENA IN THE FUTURE.

Our success will depend to a significant extent on the continued service of
our senior executives and certain other key employees, including certain sales,
consulting, technical and marketing personnel. If we lost the services of one or
more of our executives or key employees, including if one or more of our
executives or key employees decided to join a competitor or otherwise compete
directly or indirectly with SERENA, this could materially adversely affect our
business. In particular, we have historically relied on the experience and
dedication of our product authors. With the exception of Douglas D. Troxel,
SERENA's founder, Chief Technology Officer and Chairman of SERENA's board of
directors, the employment of all of our senior and key employees, including key
product authors, is at will. Mr. Troxel's

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<PAGE>
employment is on a year-to-year basis. In addition, we do not maintain key man
life insurance on our employees and have no plans to do so.

WE MAY NOT BE ABLE TO RECRUIT AND RETAIN THE PERSONNEL WE NEED.

Our future success will likely depend in large part on our ability to
attract and retain additional experienced sales, technical, marketing and
management personnel. In addition, we will need to attract and retain sufficient
numbers of qualified software engineers, as well as sales and marketing and
support personnel, and successfully develop, market and support our FULL.CYCLE
DESKTOP product suite which is currently in development. Competition for such
personnel in the computer software industry is intense, and in the past we have
experienced difficulty in recruiting qualified personnel, especially developers
and sales personnel. We expect competition for qualified personnel to remain
intense, and we may not succeed in attracting or retaining such personnel. If we
do not, this could materially adversely affect our business and future quarterly
and annual operating results. In addition, new employees generally require
substantial training in the use of our products. This training will require
substantial resources and management attention.

INTERNATIONAL OPERATIONS. We intend to expand the scope of our
international operations and these plans will require us to attract experienced
management, service, marketing, sales and support personnel for our
international offices. Competition for such personnel is intense, and we may not
be able to attract or retain such experienced personnel.

NON-U.S. CITIZENS WORKING IN THE UNITED STATES. To achieve our business
objectives, we may recruit and employ skilled technical professionals from other
countries to work in the United States. Limitations imposed by federal
immigration laws and the availability of visas could materially adversely affect
our ability to attract necessary qualified personnel. This may have a material
adverse effect on our business and future quarterly and annual operating
results.

POTENTIAL YEAR 2000 PROBLEMS WITH OUR SOFTWARE OR OUR INTERNAL OPERATING SYSTEMS
COULD ADVERSELY AFFECT OUR BUSINESS.

SERENA SOFTWARE. If any of our licensees experience Year 2000 problems as a
result of their use of our software products, those licensees could assert
claims for damages which, if successful, could materially adversely affect our
business, future operating results and financial condition. In the ordinary
course of our business, we test and evaluate our software products. We believe
that our software products are generally Year 2000 compliant, meaning that the
use or occurrence of dates on or after January 1, 2000 will not materially
affect the performance of our software products or the ability of our products
to correctly create, store, process and output information of data involving
dates. However, we may learn that certain of our software products do not
contain all necessary software routines and codes necessary for the accurate
calculation, display, storage and manipulation of data involving dates. In
addition, in certain cases, we have warranted that the use or occurrence of
dates on or after January 1, 2000 will not adversely affect the performance of
our products with respect to four digit date dependent data or the ability to
create, store, process and output information related to such data.

THIRD PARTY EQUIPMENT AND SOFTWARE. We use third party equipment and
software that may not be Year 2000 compliant. If this third party equipment or
software does not operate properly with regard to the Year 2000, we may incur
unexpected expenses to remedy any problems. These costs may materially adversely
affect our business. In addition, if our key systems, or a significant number of
our systems, failed as a result of Year 2000 problems we could incur substantial
costs and disruption of our business.

CUSTOMER BUYING PATTERNS. In addition, the purchasing patterns of our
customers and potential customers may be affected by Year 2000 issues. Many
companies are spending significant resources to correct their current software
systems for Year 2000 compliance. While sales of certain of our products, in
particular STARWARP and COMPAREX, have benefited from increased customer
spending on Year 2000

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<PAGE>
readiness, we believe sales of our CHANGE MAN product have been and will
continue to be adversely affected by customer focus on Year 2000 issues.
Customers with limited IT budgets who face material Year 2000 issues are
spending their limited resources remediating these Year 2000 problems instead of
investing in more general IT products, such as CHANGE MAN.

OUR INDUSTRY CHANGES RAPIDLY DUE TO EVOLVING TECHNOLOGY STANDARDS AND OUR FUTURE
SUCCESS WILL DEPEND ON OUR ABILITY TO CONTINUE TO MEET THE SOPHISTICATED NEEDS
OF OUR CUSTOMERS.

Our future success will depend on our ability to address the increasingly
sophisticated needs of our customers by supporting existing and emerging
hardware, software, database and networking platforms. We will have to develop
and introduce enhancements to our existing products and new products on a timely
basis to keep pace with technological developments, evolving industry standards
and changing customer requirements. We expect that we will have to respond
quickly to rapid technological change, changing customer needs, frequent new
product introductions and evolving industry standards that may render existing
products and services obsolete. As a result, our position in existing markets or
potential markets could be eroded rapidly by product advances. The life cycles
of our products are difficult to estimate. Our growth and future financial
performance will depend in part upon our ability to enhance existing
applications, develop and introduce new applications that keep pace with
technological advances, meet changing customer requirements and respond to
competitive products. We expect that our product development efforts will
continue to require substantial investments. We may not have sufficient
resources to make the necessary investments. Any of these events could have a
material adverse effect on our business, quarterly and annual operating results
and financial condition.

THIRD PARTIES IN THE FUTURE COULD ASSERT THAT OUR PRODUCTS INFRINGE THEIR
INTELLECTUAL PROPERTY RIGHTS, WHICH COULD ADVERSELY AFFECT OUR BUSINESS; THERE
COULD BE POTENTIAL ADVERSE EFFECTS OF THE PENDING COMPUWARE CLAIM.

Third parties may claim that our current or future products infringe their
proprietary rights. Any claims of this type could affect our relationships with
existing customers and may prevent future customers from licensing our products.
Because we are dependent upon a limited number of products, any such claims,
with or without merit, could be time consuming, result in costly litigation,
cause product shipment delays or require us to enter into royalty or licensing
agreements. Royalty or license agreements may not be available on acceptable
terms or at all. We expect that software product developers will increasingly be
subject to infringement claims as the number of products and competitors in the
software industry segment grows and the functionality of products in different
industry segments overlaps. As a result of these factors, infringement claims
could materially adversely affect our business.

In September 1998, Compuware Corporation, or Compuware, filed suit against
SERENA in the United States District Court for the Eastern District of Michigan
seeking unspecified compensatory damages, costs and attorneys fees, and
injunctive relief based on allegations of copyright infringement, trade secret
misappropriation and various tort claims related to the sale of our STARTOOL and
STARWARP products. Compuware served the complaint on SERENA in November 1998.
Due to the nature of litigation generally, and due to the fact that discovery is
ongoing, management cannot ascertain the availability of injunctive relief or
other equitable remedies or estimate the total expenses, possible damages or
settlement value, if any, that may ultimately be incurred in connection with
Compuware's suit. However, management believes, based on the advice of counsel,
that SERENA has meritorious defenses to the allegations contained in Compuware's
complaint. We believe that this matter will not have a material adverse effect
on our results of operations or financial condition. This litigation could be
time consuming and costly, and there can be no assurance that SERENA will
necessarily prevail given the inherent uncertainties of litigation. In the event
that we do not prevail in litigation, we could be prevented from selling our
STARTOOL and STARWARP products or be required to enter into royalty or licensing
agreements or pay monetary damages. Such royalty or licensing agreements, if
required, may not be available on terms

14
<PAGE>
acceptable to SERENA or at all. In the event of a successful claim against us,
our business, future operating results or financial condition could be
materially adversely affected.

ERRORS IN OUR PRODUCTS OR THE FAILURE OF OUR PRODUCTS TO CONFORM TO
SPECIFICATIONS COULD RESULT IN OUR CUSTOMERS DEMANDING REFUNDS FROM US OR
ASSERTING CLAIMS FOR DAMAGES AGAINST US.

Because our software products are complex, they often contain errors or
"bugs" that can be detected at any point in a product's life cycle. While we
continually test our products for errors and work with customers through our
customer support services to identify and correct bugs in our software, we
expect that errors in our products will continue to be found in the future.
Although many of these errors may prove to be immaterial, certain of these
errors could be significant. Detection of any significant errors may result in,
among other things, loss of, or delay in, market acceptance and sales of our
products, diversion of development resources, injury to our reputation, or
increased service and warranty costs. These problems could materially adversely
affect our business and future quarterly and annual operating results. In the
past we have discovered errors in certain of our products and have experienced
delays in the shipment of our products during the period required to correct
these errors. These delays have principally related to new version and product
update releases. To date none of these delays have materially affected our
business. However, product errors or delays in the future, including any product
errors or delays associated with the introduction of our FULL.CYCLE DESKTOP
products, could be material. In addition, in certain cases we have warranted
that our products will operate in accordance with specified customer
requirements. If our products fail to conform to such specifications, customers
could demand a refund for the software license fee paid to us or assert claims
for damages.

PRODUCT LIABILITY CLAIMS ASSERTED AGAINST US IN THE FUTURE COULD ADVERSELY
AFFECT OUR BUSINESS.

We may be subject to claims for damages related to product errors in the
future. While we carry insurance policies covering this type of liability, these
policies may not provide sufficient protection should a claim be asserted. A
material product liability claim could materially adversely affect our business.
Our license agreements with our customers typically contain provisions designed
to limit exposure to potential product liability claims. SERENA's standard
software licenses provide that if our products fail to perform, we will correct
or replace such products. If these corrective measures fail, we may be required
to refund the license fee for such non-performing product. However, our standard
license agreement limits our liability for non-performing products to the amount
of license fee paid, if the license has been in effect for less than one year,
or to the amount of the licensee's current annual maintenance fee, if the
license is more than one year old. Our standard license also provides that
SERENA shall not be liable for indirect or consequential damages caused by the
failure of our products. Such limitation of liability provisions may, however,
not be effective under the laws of certain jurisdictions to the extent local
laws treat certain warranty exclusions as unenforceable. Although we have not
experienced any product liability claims to date, the sale and support of our
products entail the risk of such claims. In particular, issues relating to Year
2000 compliance have increased awareness of the potential adverse effects of
software defects and malfunctions.

ANY ACQUISITIONS OR INVESTMENTS THAT WE MAY MAKE WILL BE SUBJECT TO A NUMBER OF
FACTORS WHICH COULD ADVERSELY AFFECT OUR BUSINESS; SUCH INVESTMENTS OR
ACQUISITIONS MAY DILUTE EXISTING STOCKHOLDERS.

In the future we may make acquisitions of, or large investments in,
businesses that offer products, services and technologies that we believe would
help us better provide SCM products and services or help us expand our
distribution channels. We may not be able to complete any such additional
acquisitions in the future. Any future acquisitions or investments would present
risks commonly encountered in acquisitions of businesses. The following are
examples of such risks:

- Difficulty in combining the technology, operations or work force of the
acquired business

- Disruption of SERENA's on-going businesses

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<PAGE>
- Difficulty in realizing the potential financial or strategic benefits of
the transaction

- Difficulty in maintaining uniform standards, controls, procedures and
policies

- Possible impairment of relationships with employees and clients as a
result of any integration of new businesses and management personnel

We expect that future acquisitions, if any, could provide for consideration
to be paid in cash, shares of SERENA common stock, or a combination of cash and
SERENA common stock. If the consideration for such transaction is paid in common
stock, this would further dilute existing stockholders. Any amortization of
goodwill or other assets resulting from such acquisition transaction could
materially impair our operating results and financial condition. If an
acquisition or large investment were to take place, the risks described above
could materially adversely affect our business and future operating results.

OUR STOCK WILL LIKELY BE SUBJECT TO SUBSTANTIAL PRICE AND VOLUME FLUCTUATIONS
DUE TO A NUMBER OF FACTORS, CERTAIN OF WHICH ARE BEYOND OUR CONTROL.

Stock prices and trading volumes for many technology companies fluctuate
widely for reasons which may be unrelated to their businesses or results of
operations. These fluctuations, as well as general economic, market and
political conditions, could materially adversely affect the market price of
SERENA's common stock.

Future announcements concerning SERENA or our competitors could cause the
market price of the common stock to fluctuate greatly. These type of
announcements may include information concerning:

- Any shortfall in SERENA's revenues or net income from revenues or net
income expected by securities analysts

- Announcements of new products by SERENA or our competitors, including
announcements regarding our FULL.CYCLE DESKTOP products, currently under
development

- Quarterly fluctuations in our financial results or the results of other
software companies, including those of our direct competitors

- Changes in analysts' estimates of our financial performance, the financial
performance of our competitors, or the financial performance of software
companies in general

- Changes in prices of our products or the products of our competitors

- Changes in our revenue growth rates or the growth rates of our competitors

- Sales of large blocks of SERENA common stock

- Conditions in the financial markets in general and the software industry
in particular

FORWARD-LOOKING STATEMENTS

Certain statements under the captions "Prospectus Summary," "Risk Factors"
and elsewhere in this prospectus are "forward-looking statements." These
forward-looking statements include, but are not limited to, statements about our
plans, objectives, expectations and intentions and other statements contained in
the prospectus that are not historical facts. When used in this prospectus, the
words "expects," "anticipates," "intends," "plans," "believes," "seeks,"
"estimates" and similar expressions are generally intended to identify
forward-looking statements. Because these forward-looking statements involve
risks and uncertainties, there are important factors that could cause actual
results to differ materially from those expressed or implied by these
forward-looking statements, including our plans, objectives, expectations and
intentions and other factors discussed under "Risk Factors."

USE OF PROCEEDS

SERENA will not receive any proceeds from the sale of the shares by the
selling stockholders.

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<PAGE>
SELLING SECURITY HOLDERS

Except as set forth below, all of the shares of common stock owned by the
selling stockholders were issued pursuant to restricted stock purchase
agreements or under our 1997 Stock Option and Incentive Plan. Beneficial
ownership calculations are determined in accordance with the rules of the SEC
and are based on 25,368,501 shares outstanding as of July 31, 1999; in computing
the number of shares beneficially owned by a person and the percentage ownership
of that person, shares of common stock that are presently exercisable or that
will become exercisable within 60 days of July 31, 1999 are deemed outstanding
for such person, but are not treated as outstanding for the purpose of computing
the percentage ownership of any other person. Until we satisfy the requirements
for use of Form S-3, which we anticipate will occur in February 2000, the volume
limitations specified in Rule 144(e) under the Securities Act concerning the
amount of securities to be offered by each person and any other person with whom
he or she is acting in concert for the purpose of selling SERENA securities,
during any three-month period apply to the sale of the securities registered
hereunder. The following table shows the names of the selling stockholders and
the number of shares of common stock to be sold by them pursuant to this
prospectus.

<TABLE>
<CAPTION>
BENEFICIAL OWNERSHIP
OF COMMON STOCK AS OF
JULY 31, 1999
---------------------- NUMBER OF SHARES OF
SELLING STOCKHOLDERS TOTAL NUMBER PERCENT COMMON STOCK REGISTERED
- --------------------------------------------- ------------ ------- -----------------------
<S> <C> <C> <C>
Richard A. Doerr(1).......................... 1,334,250 5.3% 1,334,250
Marianne M. Elkholy(2)....................... 76,875 * 76,875
Alan H. Hunt(3).............................. 56,250 * 56,250
Robert I. Pender, Jr.(4)..................... 184,500 * 184,500
Anthony G. Stayner(5)........................ 117,769 * 117,769
Vita A. Strimaitis(6)........................ 137,250 * 137,250
Mark E. Woodward(7).......................... 79,107 * 79,107
</TABLE>

- ------------------------

* Less than 1%.

(1) Mr. Doerr is SERENA's President and Chief Executive Officer and a member of
our board of directors. These shares are subject to a repurchase right in
favor of SERENA in the event Mr. Doerr's employment with SERENA terminates.
This repurchase right lapses with respect to one third of the shares subject
to the agreement on the first year anniversary of Mr. Doerr's initial
employment and lapses with respect to the remaining shares on a monthly
basis over the succeeding two years. In the event of a change in control
transaction, SERENA's right to repurchase any unvested shares will lapse.

(2) Ms. Elkholy resigned as SERENA's Vice President, Worldwide Marketing in May
1999.

(3) Mr. Hunt is a member of our board of directors. These shares are subject to
a repurchase right in favor of SERENA in the event Mr. Hunt's membership in
the board of directors terminates. This repurchase right lapses with respect
to one quarter of the shares subject to the agreements on the first
anniversary of their hire date, and the remaining shares vest ratably on a
monthly basis over the succeeding three years. In the event of a change in
control transaction, SERENA's right to repurchase unvested shares will
lapse.

(4) Mr. Pender is SERENA's Vice President, Financial Administration, Chief
Financial Officer and Secretary. These shares are subject to a repurchase
right in favor of SERENA in the event Mr. Pender's employment with SERENA
terminates. This repurchase right lapses with respect to one quarter of the
shares subject to the agreements on the first anniversary of their hire
date, and the remaining shares vest ratably on a monthly basis over the
succeeding three years. In the event of a change in control transaction,
SERENA's right to repurchase unvested shares will lapse.

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<PAGE>
(5) Mr. Stayner is SERENA's Vice President, Services. These shares are subject
to a repurchase right in favor of SERENA in the event Mr. Stayner's
employment with SERENA terminates. This repurchase right lapses with respect
to one quarter of the shares subject to the agreements on the first
anniversary of their hire date, and the remaining shares vest ratably on a
monthly basis over the succeeding three years. In the event of a change in
control transaction, SERENA's right to repurchase unvested shares will
lapse.

(6) Ms. Strimaitis is SERENA's Vice President and General Counsel. These shares
are subject to a repurchase right in favor of SERENA in the event Ms.
Strimaitis' employment with SERENA terminates. This repurchase right lapses
with respect to one quarter of the shares subject to the agreements on the
first anniversary of their hire date, and the remaining shares vest ratably
on a monthly basis over the succeeding three years. In the event of a change
in control transaction, SERENA's right to repurchase unvested shares will
lapse.

(7) Mr. Woodward is SERENA's Vice President, Sales. These shares are subject to
a repurchase right in favor of SERENA in the event Mr. Woodward's employment
with SERENA terminates. This repurchase right lapses with respect to one
quarter of the shares subject to the agreements on the first anniversary of
their hire date, and the remaining shares vest ratably on a monthly basis
over the succeeding three years. In the event of a change in control
transaction, SERENA's right to repurchase unvested shares will lapse.

18
<PAGE>
PLAN OF DISTRIBUTION

We have been advised by the selling stockholders that they intend to sell
all or a portion of the shares offered hereby from time to time in the Nasdaq
National Market and that sales will be made at prices prevailing in the Nasdaq
National Market at the times of such sales. Selling stockholders include donees
and pledgees selling shares received from a selling stockholder after the date
of this prospectus subject to applicable restrictions of the Securities Act and
the rules promulgated thereunder. The selling stockholders may also make private
sales directly or through a broker or brokers, who may act as agent or as
principal. Further, the selling stockholders may choose to dispose of the shares
offered hereby by gift to a third party or as a donation to a charitable or
other non-profit entity. In connection with any sales, the selling stockholders
and any brokers participating in such sales may be deemed to be underwriters
within the meaning of the Securities Act.

Any broker-dealer participating in such transactions as agent may receive
commissions from the selling stockholders (and, if such broker acts as agent for
the purchaser of such shares, from such purchaser). Usual and customary
brokerage fees will be paid by the selling stockholders. Broker-dealers may
agree with the selling stockholders to sell a specified number of shares at a
stipulated price per share, and, to the extent such a broker-dealer is unable to
do so acting as agent for the selling stockholders, to purchase as principal any
unsold shares at the price required to fulfill the broker-dealer commitment to
the selling stockholders. Broker-dealers who acquire shares as principal may
thereafter resell such shares from time to time in transactions (which may
involve crosses and block transactions and which may involve sales to and
through other broker-dealers, including transactions of the nature described
above) in the over-the-counter market, in negotiated transactions or otherwise
at market prices prevailing at the time of sale or at negotiated prices, and in
connection with such resales may pay to or receive from the purchasers of such
shares commissions computed as described above.

We have advised the selling stockholders that Regulation M promulgated under
the Exchange Act may apply to sales in the market and has informed them of the
possible need for delivery of copies of this prospectus. The selling
stockholders may indemnify any broker-dealer that participates in transactions
involving the sale of the shares against certain liabilities, including
liabilities arising under the Securities Act. Any commissions paid or any
discounts or concessions allowed to any such broker-dealers, and, if any such
broker-dealers purchase shares as principal, any profits received on the resale
of such shares, may be deemed to be underwriting discounts and commissions under
the Securities Act.

If we are notified by the selling stockholders that any material arrangement
has been entered into with a broker-dealer for the sale of shares through a
cross or block trade, a supplemental prospectus will be filed under Rule 424(c)
under the Securities Act, setting forth the name of the participating broker-
dealer(s), the number of shares involved, the price at which such shares were
sold by the selling stockholders, the commissions paid or discounts or
concessions allowed by the selling stockholders to such broker-dealer(s), and
where applicable, that such broker-dealer(s) did not conduct any investigation
to verify the information set out in this prospectus.

As of the date of this prospectus, all selling stockholders were subject to
lock-up agreements pursuant to which they would not be permitted to sell,
transfer or otherwise dispose of any shares of, or securities convertible into
or exchangeable for, our common stock for a period of 180 days from February 11,
1999, the date of our initial public offering, without the prior written consent
of Hambrecht & Quist LLC, one of the managing underwriters of the initial public
offering.

Any securities covered by this prospectus which qualify for sale pursuant to
Rules 144 and 701 under the Securities Act may be sold under Rule 144 rather
than pursuant to this prospectus. In general, under Rule 144 as currently in
effect, a person (or persons whose shares are aggregated), including any person
who may be deemed to be an "affiliate" of SERENA, is entitled to sell within any
three month period "restricted shares" beneficially owned by him or her in an
amount that does not exceed the greater of 1% of the then outstanding shares of
common stock or the average weekly trading volume in shares of

19
<PAGE>
common stock during the four calendar weeks preceding such sale, provided that
at least one year has elapsed since such shares were acquired from SERENA or an
affiliate of SERENA. Sales are also subject to certain requirements as to the
manner of sale, notice and availability of current public information regarding
SERENA. However, a person who has not been an "affiliate" of SERENA at any time
within three months prior to the sale is entitled to sell his or her shares
without regard to the volume limitations or other requirements of Rule 144,
provided that at least one year has elapsed since such shares were acquired from
SERENA or an affiliate of SERENA. In general, under Rule 701 as currently in
effect, any employee, consultant or advisor of SERENA who purchases shares from
SERENA in connection with a compensatory stock or option plan or other written
agreement related to compensation is eligible to resell such shares 90 days
after the date of our initial public offering on February 11, 1999 in reliance
on Rule 144, but without compliance with certain restrictions contained in Rule
144.

There can be no assurance that the selling stockholders will sell any or all
of the shares of common stock offered under this prospectus.

20
<PAGE>
INDEMNIFICATION OF DIRECTORS AND OFFICERS

Section 145 of the Delaware General Corporation Law permits a corporation to
include in its charter documents, and in agreements between the corporation and
its directors and officers, provisions expanding the scope of indemnification
beyond that specifically provided by the current law.

Article IX of the our Amended and Restated Certificate of Incorporation
provides for the indemnification of directors to the fullest extent permissible
under Delaware law.

Article VI of the our Bylaws provides for the indemnification of officers,
directors and third parties acting on behalf of the corporation if such person
acted in good faith and in a manner reasonably believed to be in and not opposed
to the best interest of the corporation, and, with respect to any criminal
action or proceeding, the indemnified party had no reason to believe his conduct
was unlawful.

We have entered into indemnification agreements with its directors and
executive officers, in addition to the indemnification provided for in our
Bylaws, and intend to enter into indemnification agreements with any new
directors and executive officers in the future.

Insofar as indemnification by SERENA for liabilities arising under the
Securities Act may be permitted to our directors, officers and controlling
persons pursuant to the provisions referenced in prospectus or otherwise, we
have been advised that in the opinion of the SEC such indemnification is against
public policy as expressed in the Securities Act, and is, therefore,
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by SERENA of expenses incurred or paid by a
director, officer, or controlling person of SERENA in the successful defense of
any action, suit or proceeding) is asserted by such director, officer or
controlling person in connection with the securities being registered hereunder,
we will, unless in the opinion of its counsel the matter has been settled by
controlling precedent, submit to a court of appropriate jurisdiction the
question whether such indemnification by it is against public policy as
expressed in the Securities Act and will be governed by the final adjudication
of such issue.

EXPERTS

The consolidated financial statements and schedule of SERENA Software, Inc.
and subsidiaries as of January 31, 1998 and 1999, and for each of the years in
the three-year period ended January 31, 1999, have been incorporated by
reference herein and in the registration statement in reliance upon the report
of KPMG LLP, independent auditors, incorporated by reference herein, and upon
the authority of said firm as experts in accounting and auditing.

21
<PAGE>
SERENA SOFTWARE, INC.
REGISTRATION STATEMENT ON FORM S-8
PART II
INFORMATION REQUIRED IN REGISTRATION STATEMENT

ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.

There are hereby incorporated by reference in this prospectus the following
documents and information heretofore filed with the SEC.

(1) Our Annual Report on Form 10-K for the fiscal year ended January 31,
1999.

(2) Our Quarterly Report on Form 10-Q for the quarter ended April 30,
1999, filed pursuant to Section 13 of the Exchange Act.

(3) The description of our common stock contained in the Registration
Statement on Form 8-A filed January 22, 1999 pursuant to Section 12(g) of
the Exchange Act.

ITEM 4. DESCRIPTION OF SECURITIES.

Not applicable.

ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.

Not applicable.

ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.

Article IX of our Amended and Restated Certificate of Incorporation provides
for the indemnification of directors to the fullest extent permissible under
Delaware Law.

Article VI of our Bylaws provides for the indemnification of officers,
directors and third parties acting on behalf of the corporation if such person
acted in good faith and in a manner reasonably believed to be in and not opposed
to the best interest of the corporation, and, with respect to any criminal
action or proceeding, the indemnified party had no reason to believe his conduct
was unlawful.

ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.

The issuance of the shares being offered by the Form S-3 resale prospectus
were deemed to be exempt from registration under the Securities Act in reliance
on Section 4(2) of the Securities Act or Regulation D promulgated thereunder, or
Rule 701 promulgated under Section 3(b) of the Securities Act, as transactions
by an issuer not involving a public offering or transactions pursuant to
compensatory benefit plans and

II-1
<PAGE>
contracts relating to compensation as provided under such Rule 701. The
recipients of securities in each such transaction represented their intention to
acquire the securities for investment only and not with a view to or for sale in
connection with any distribution thereof and appropriate legends were affixed to
the share certificates and instruments issued in such transactions. All
recipients had adequate access, through their relationship with SERENA, to
information about the Registrant.

ITEM 8. EXHIBITS.

<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- --------- --------------------------------------------------------------------------------------------------------
<C> <S>
5.1 Opinion of counsel as to legality of securities being registered.

10.2A* Amended and Restated Stock Option and Incentive Plan

10.2B* Form of Option Agreement under the Amended and Restated 1997 Stock Option and Incentive Plan

10.2C* Form of Restricted Stock Purchase Agreement under the Amended and Restated 1997 Stock Option and
Incentive Plan

10.3A* 1999 Employee Stock Purchase Plan

10.3B* Form of Subscription Agreement under the 1999 Employee Stock Purchase Plan

10.4A* 1999 Director Option Plan

10.4B* Form of Option Agreement under 1999 Director Option Plan

23.1 Consent of counsel (contained in Exhibit 5.1).

23.2 Independent Auditors' Consent

24.1 Power of Attorney (see page II-4).
</TABLE>

- ------------------------

* Incorporated by reference to the exhibit bearing the same number filed with
SERENA's Registration Statement on Form S-1, as amended (No. 333-67761),
which the SEC declared effective on February 11, 1999.

ITEM 9. UNDERTAKINGS.

A. SERENA hereby undertakes:

(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this registration statement to include any
material information with respect to the plan of distribution not previously
disclosed in the registration statement or any material change to such
information in the registration statement.

(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to be a
new registration statement relating to the securities offered therein, and
the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.

(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.

B. SERENA hereby undertakes that, for purposes of determining any liability
under the Securities Act, each filing of SERENA's annual report pursuant to
Section 13(a) or Section 15(d) of the Exchange Act (and, where applicable, each
filing of an employee benefit plan's annual report pursuant to Section 15(d) of
the Exchange Act) that is incorporated by reference in the registration
statement shall be

II-2
<PAGE>
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.

C. Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of SERENA
pursuant to law, the SERENA's Certificate of Incorporation, Bylaws or
indemnification agreements, SERENA has been informed that in the opinion of the
SEC such indemnification is against public policy as expressed in the Securities
Act and is therefore unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by SERENA of
expenses incurred or paid by a director, officer or controlling person of SERENA
in a successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered hereunder, SERENA will, unless in the opinion of its counsel the
matter has already been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question of whether such indemnification by it is
against public policy as expressed in the Securities Act and will be governed by
the final adjudication of such issue.

II-3
<PAGE>
SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8/S-3 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Burlingame, State of California, on this 4th day of
August, 1999.

<TABLE>
<S> <C> <C>
SERENA SOFTWARE, INC.

By: /s/ RICHARD A. DOERR
-----------------------------------------
Richard A. Doerr
PRESIDENT AND CHIEF EXECUTIVE OFFICER
</TABLE>

POWER OF ATTORNEY

KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Richard A. Doerr and Robert I. Pender, Jr., and
each of them, as his or her attorney-in-fact, with full power of substitution in
each, for him or her in any and all capacities to sign any amendments to this
Registration Statement on Form S-8/S-3, and to file the same, with exhibits
thereto and other documents in connection therewith, with the Securities and
Exchange Commission, hereby ratifying and confirming all that said
attorney-in-fact, or his substitutes, may do or cause to be done by virtue
hereof.

Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed below by the following persons in the
capacities and on the dates indicated.

<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
- ------------------------------ -------------------------- -------------------

<C> <S> <C>
President and Chief
/s/ RICHARD A. DOERR Executive Officer and
- ------------------------------ Director (Principal August 4, 1999
(Richard A. Doerr) Executive Officer)

Vice President, Finance
and Administration,
/s/ ROBERT I. PENDER, JR. Chief Financial Officer
- ------------------------------ and Secretary (Principal August 4, 1999
(Robert I. Pender, Jr.) Financial and Accounting
Officer)

/s/ DOUGLAS D. TROXEL Chairman of the Board of
- ------------------------------ Directors and Chief August 4, 1999
(Douglas D. Troxel) Technology Officer

/s/ ALAN H. HUNT
- ------------------------------ Director August 4, 1999
(Alan H. Hunt)

/s/ JERRY T. UNGERMAN
- ------------------------------ Director August 4, 1999
(Jerry T. Ungerman)
</TABLE>

II-4
<PAGE>
INDEX TO EXHIBITS

<TABLE>
<CAPTION>
EXHIBIT SEQUENTIALLY
NUMBER DESCRIPTION NUMBERED PAGE
- --------- --------------------------------------------------------------------------------------- -------------------
<C> <S> <C>
5.1 Opinion of counsel as to legality of securities being registered.

10.2A* Amended and Restated Stock Option and Incentive Plan

10.2B* Form of Option Agreement under the Amended and Restated 1997 Stock Option and Incentive
Plan

10.2C* Form of Restricted Stock Purchase Agreement under the Amended and Restated 1997 Stock
Option and Incentive Plan

10.3A* 1999 Employee Stock Purchase Plan

10.3B* Form of Subscription Agreement under the 1999 Employee Stock Purchase Plan

10.4A* 1999 Director Option Plan

10.4B* Form of Option Agreement under 1999 Director Option Plan

23.1 Consent of counsel (contained in Exhibit 5.1).

23.2 Independent Auditors' Consent

24.1 Power of Attorney (see page II-4).
</TABLE>

- ------------------------

<PAGE>
EXHIBIT 5.1

[WILSON SONSINI GOODRICH & ROSATI LETTERHEAD]

August 4, 1999

SERENA Software, Inc.
500 Airport Boulevard, 2nd Floor
Burlingame, California 94010-1904

RE: REGISTRATION STATEMENT ON FORM S-8/S-3

Ladies and Gentlemen:

We have examined the Registration Statement on Form S-8/S-3 to be filed by
you with the Securities and Exchange Commission on August 3, 1999 (as such may
thereafter be amended or supplemented, the "Registration Statement"), in
connection with the registration under the Securities Act of 1933, as amended,
of 4,925,000 shares of your Common Stock, $0.001 par value (the "Shares"), of
which 1,986,001 shares have been issued pursuant to certain restricted stock
agreements between the Company and certain of its executive officers under the
Amended and Restated 1997 Stock Option and Incentive Plan (the "1997 Plan"),
2,563,999 shares of Common Stock are reserved for future issuance under the 1997
Plan, 225,000 shares are reserved for future issuance under the Company's 1999
Employee Stock Purchase Plan and 150,000 shares are reserved for future issuance
under the Company's 1999 Director Option Plan. As your legal counsel, we have
examined the proceedings taken, and are familiar with the proceedings proposed
to be taken, by you in connection with the sale and issuance of the Shares.

It is our opinion that, upon completion of the proceedings being taken or
contemplated by us, as your counsel, to be taken prior to the issuance of the
Shares, the Shares, when issued and sold in the manner described in the
Registration Statement and in accordance with the resolutions adopted by the
Board of Directors of the Company, will be legally and validly issued, fully
paid and nonassessable.

We consent to the use of this opinion as an exhibit to the Registration
Statement and further consent to the use of our name wherever appearing in the
Registration Statement, including the Prospectus constituting a part thereof,
and any amendments thereto.

Very truly yours,

WILSON SONSINI GOODRICH & ROSATI
Professional Corporation

/s/ Wilson Sonsini Goodrich & Rosati

<PAGE>
EXHIBIT 23.2

INDEPENDENT AUDITORS' CONSENT

The Board of Directors
SERENA Software, Inc.:

We consent to the incorporation herein by reference of our reports dated
February 22, 1999, except as to Note 11, which is as of March 12, 1999, relating
to the consolidated balance sheets of SERENA Software, Inc. and subsidiaries as
of January 31, 1998 and 1999, and the related consolidated statements of income,
stockholders' equity, and cash flows for each of the years in the three-year
period ended January 31, 1999, and the related schedule, which reports appear in
the January 31, 1999, annual report on Form 10-K of SERENA Software, Inc.

/s/ KPMG LLP

Mountain View, California
August 3, 1999