Salesforce has built a deep bench of executive talent via acquisition

When Salesforce acquired Quip in 2016 for $750 million, it gained CEO and co-founder Bret Taylor as part of the deal. Taylor has since risen quickly through the ranks of the software giant to become president and COO, second in command behind CEO Marc Benioff. Taylor’s experience shows that startup founders can sometimes play a key role in the companies that acquire them.

Benioff, 56, has been running Salesforce since its founding more than 20 years ago. While he hasn’t given any public hints that he intends to leave anytime soon, if he wanted to step back from the day-to-day running of the company or even job share the role, he has a deep bench of executive talent including many experienced CEOs, who like Taylor came to the company via acquisition.

One way to step back from the enormous responsibility of running Salesforce would be by sharing the role.

He and his wife Lynne have been active in charitable giving and in 2016 signed The Giving Pledge, an initiative from the The Bill and Melinda Gates Foundation, to give a majority of their wealth to philanthropy. One could see him wanting to put more time into pursuing these charitable endeavors just as Gates did 20 years ago. As a means of comparison, Gates founded Microsoft in 1975 and stayed for 25 years until he left in 2000 to run his charitable foundation full time.

Even if this remains purely speculative for the moment, there is a group of people behind him with deep industry experience, who could be well-suited to take over should the time ever come.

Resurrecting the co-CEO role

One way to step back from the enormous responsibility of running Salesforce would be by sharing the role. In fact, for more than a year starting in 2018, Benioff actually shared the top job with Keith Block until his departure last year. When they worked together, the arrangement seemed to work out just fine with Block dealing with many larger customers and helping the software giant reach its $20 billion revenue goal.

Before Block became co-CEO, he had a myriad other high-level titles including co-chairman, president and COO — two of which, by the way, Taylor has today. That was a lot of responsibility for one person inside a company the size of Salesforce, but promoting him to co-CEO from COO gave the company a way to reward his hard work and help keep him from jumping ship (he eventually did anyway).

As Holger Mueller, an analyst at Constellation Research points out, the co-CEO concept has worked out well at major enterprise companies that have tried it in the past, and it helped with continuity. “Salesforce, SAP and Oracle all didn’t miss a beat really with the co-CEO departures,” he said.

If Benioff wanted to go back to the shared responsibility model and take some work off his plate, making Taylor (or someone else) co-CEO would be one way to achieve that. Certainly, Brent Leary, lead analyst at CRM Essentials sees Taylor gaining increasing responsibility as time goes along, giving credence to the idea.

“Ever since Quip was acquired Taylor seemed to be on the fast track, becoming president and chief product officer less than a year-and-a-half after the acquisition, and then two years later being promoted to chief operating officer,” Leary said.

Who else could be in line?

While Taylor isn’t the only person who could step into Benioff’s shoes, he looks like he has the best shot at the moment, especially in light of the $27.7 billion Slack deal he helped deliver earlier this month.

“Taylor being publicly praised by Benioff for playing a significant role in the Slack acquisition, Salesforce’s largest acquisition to date, shows how much he has solidified his place at the highest levels of influence and decision-making in the organization,” Leary pointed out.

But Mueller posits that his rapid promotions could also show something might be lacking with internal options, especially around product. “Taylor is a great, smart guy, but his rise shows more the product organization bench depth challenges that Salesforce has,” he said.


By Ron Miller

Salesforce announces 12,000 new jobs in the next year just weeks after laying off 1000

In a case of bizarre timing, Salesforce announced it was laying off 1000 employees at the end of last month just a day after announcing a monster quarter with over $5 billion in revenue, putting the company on a $20 billion revenue run rate for the first time. The juxtaposition was hard to miss.

Earlier today, Salesforce CEO and co-founder Marc Benioff announced in tweet that the company would be hiring 4000 new employees in the next six months, and 12,000 in the next year. While it seems like a mixed message, it’s probably more about reallocating resources to areas where they are needed more.

While Salesforce wouldn’t comment further on the hirings, the company has obviously been doing well in spite of the pandemic, which has had an impact on customers. In the prior quarter, the company forecasted that it would have slower revenue growth due to giving some customers facing hard times with economic downturn, time to pay their bills.

That’s why it was surprising when the CRM giant announced its earnings in August and it had done so well in spite of all that. While the company was laying off those 1000 people, it did indicate it would give those employees 60 days to find other positions in the company. With these new jobs, assuming they are positions the laid off employees are qualified for, they could have a variety of positions to choose from.

The company had 54,000 employees when it announced the layoffs, which accounted for 1.9% of the workforce. If it ends up adding the 12,000 news jobs in the next year, that would put at approximately 65,000 employees by this time next year.


By Ron Miller

How Salesforce beat its own target to reach $20B run rate ahead of schedule

Salesforce launched in 1999, one of the early adherents to what would eventually be called SaaS and cloud computing. On Tuesday, the company reached a huge milestone when it surpassed $5 billion in revenue, putting the SaaS giant on a $20 billion run rate for the first time.

Salesforce revenue has been on a firm upward trajectory for years now, but when the company reached $10 billion in revenue in November 2017, CEO Marc Benioff set the goal for $20 billion right then and there, and five years hence the company beat that goal pretty easily. Here’s what he said at the time:

“In fact as the fastest growing enterprise software company ever to reach $10 billion, we are now targeting to grow the company organically to more than $20 billion by fiscal year 2022 and we plan to do that to be the fastest enterprise software company ever to get to $20 billion,” Benioff said at the time.

There are lots of elements that have led to that success. As the Salesforce platform evolved, the company has also had an aggressive acquisition strategy, and companies are moving to the cloud faster than ever before. Yet Salesforce has been able to meet that lofty 2017 goal early, while practicing his own unique form of responsible capitalism in the midst of a pandemic.

The platform play

While there are many factors contributing to the company’s revenue growth, one big part of it is the platform. As a platform, it’s not only about providing a set of software tools like CRM, marketing automation and customer service, it’s also giving customers the ability to build solutions to meet their needs on top of that, taking advantage of the work that Salesforce has done to build its own software stack.

Bret Taylor, president and chief operating officer at Salesforce says the platform has played a huge role in the company’s success. “Actually our platform is behind a huge part of Salesforce’s momentum in multiple ways. One, which is one thing we’ve talked a lot about, is just the technology characteristics of the platform, namely that it’s low code and fast time to value,” he
said.

He added, “I would say that these low code platforms and the ability to stand up solutions quickly is more relevant than ever before because our customers are going to have to respond to changes in their business faster than ever before,” he said.

He pointed to nCino, a company built on top of Salesforce that went public last month as a prime example of this. The company was built on Salesforce, sold in the AppExchange marketplace and provides a way for banking customers to do business online, taking advantage of all that Salesforce has built to do that.

The acquisition strategy

Another big contributing factor to the company’s success is that beyond the core CRM product, it brought to the table way back in 1999, it has built a broad set of marketing, sales and service tools and as it has done that, it has acquired many companies along the way to accelerate the product road map.

The biggest of those acquisitions by far was the $15.7 billion Tableau deal, which closed just about a year ago. Taylor sees data fueling the push to digital we are seeing during the pandemic, and Tableau is a key part of that.

“Tableau is so strategic, both from a revenue and also from a technology strategy perspective,” he said. That’s because as companies make the shift to digital, it becomes more important than ever to help them visualize and understand that data in order to understand their customer’s requirements better.

“Fundamentally when you look at what a company needs to do to thrive in an all-digital world, it needs to be able respond to [rapid] changes, which means creating a culture around that data,” he said. This enables companies to respond more quickly to changes like new customer demands or shifts in the supply chain.

“All of that is about data, and I think the reason why Tableau grew so much this past quarter is that I think that the conversation around data when you’re digitizing your entire company and digitizing the entire economy, data is more strategic than it ever was,” he said.

With that purchase, combined with the $6.5 billion MuleSoft acquisition in 2018, the company feels like it has a way to capture and visualize data wherever it lives in the enterprise. “It’s worth noting how complementary MuleSoft and Tableau are together. I think of MuleSoft as unlocking all your enterprise data, whether it’s on a legacy system or a modern system, and Tableau enables us to understand it, and so it’s a really strategic overall value proposition because we can come up with a really complete solution around data,” Taylor said.

Capitalism with some heart

Benioff was happy to point out in an appearance on Mad Money Tuesday that even as he has made charity and volunteerism a core part of his organization, he has still delivered solid returns for his shareholders. He told Mad Money host Jim Cramer, “This is a victory for stakeholder capitalism. It shows you can do good and do well.” This is a statement he has made frequently in the past to show that you can be a good corporate citizen and give back to your community, while still making money.

Those values are what separates the company from the pack says Paul Greenberg, founder and principal analyst at 56 Group and author of CRM at the Speed of Light. “Salesforce’s genius, and a large part of the reason I don’t expect any serious slowdown in that extraordinary growth, is that they manage to align the technology business with corporate social responsibility in a way that makes them stand out from any other company,” Greenberg told TechCrunch.

Yesterday’s numbers come after Q12021 in which the company offered softer guidance as it was giving some of its customers, suffering from the impact of the pandemic, more financial flexibility. As it turns out, that didn’t seem to hurt them, and the guidance for next quarter is looking good too: $5.24 billion to $5.25 billion, up approximately 16% year over year, according to the company.

It’s worth noting that while Benioff pledged no new layoffs for 90 days at the start of the pandemic, with that time now ending, the Wall Street Journal reported yesterday that the company was planning to eliminate 1000 roles out of the organization’s 54,000 total employees, while giving those workers 60 days to find other roles in the company.

Getting to $20 billion

Certainly getting to that $20 billion run rate is significant, as is the speed with which they were able to achieve that goal, but Taylor sees an evolving company, one that is different than the one it was in 2017 when Benioff set that goal.

“I would say the reason we’ve been able to accelerate is through organic [growth], innovation and acquisitions to really build out this vision of a complete customer [picture]. I think it’s more important than ever before,” he said.

He says that when you look at the way the platform has changed, it’s been about bringing multiple customer experience capabilities together under a single umbrella, and giving customers the tools they need to build these out.

“I think we as a company have constantly redefined what customer relationship management means. It’s not just opportunity management for sales teams. It’s customer service, it’s eCommerce, it’s digital marketing, it’s B2B, it’s B2C. It’s. all of the above,” he said.


By Ron Miller

Salesforce confirms it’s laying off around 1000 people in spite of monster quarter

In what felt like strange timing, Salesforce has confirmed a report in yesterday’s Wall Street Journal that it was laying off around 1000 people or approximately 1.9% of the company’s 54,000 strong workforce. This news came in spite of the company reporting a monster quarter on Tuesday in which it passed $5 billion in quarterly revenue for the first time.

In fact, Wall Street was so thrilled with Salesforce’s results, the company’s stock closed up an astonishing 26% yesterday, adding great wealth to the company’s coffers. It seemed hard to reconcile such amazing financial success with this news.

Yet it was actually something that president and chief financial officer Mark Hawkins telegraphed in Tuesday’s earnings call with industry analysts, although he didn’t come right and use the L (layoff) word. Instead he couched that impending change as a reallocation of resources.

And he talked about strategically shifting investments over the next 12-24 months. “This means we’ll be redirecting some of our resources to fuel growth in areas that are no longer as aligned with the business priority will be now deemphasized,” Hawkins said in the call.

This is precisely how a Salesforce spokesperson put it when asked by TechCrunch to confirm the story. “We’re reallocating resources to position the company for continued growth. This includes continuing to hire and redirecting some employees to fuel our strategic areas, and eliminating some positions that no longer map to our business priorities. For affected employees, we are helping them find the next step in their careers, whether within our company or a new opportunity,” the spokesperson said.

It’s worth noting that earlier this year, Salesforce CEO Marc Benioff pledged there would be no significant layoffs for 90 days.

The 90 day period has long since passed and the company has decided the time is right to make some adjustments to the workforce.

It’s worth contrasting this with the pledge that ServiceNow CEO Bill McDermott made a few weeks after the Benioff tweet, promising not to lay off a single employee for the rest of this year, while also pledging to hire 1000 people worldwide the remainder of this year, while bringing in 360 summer interns.


By Ron Miller

Salesforce stock is taking a hit today after lighter guidance in yesterday’s earning’s report

In spite of a positive quarter with record revenue that beat analyst estimates, Salesforce stock was taking a hit today because of lighter guidance. Wall Street is a tough audience.

The stock was down $8.29/share or 4.58% as of 2:15 pm ET.

The guidance, which was a projection for next quarter’s earnings, was lighter than what the analysts on Wall Street expected. While Salesforce was projecting revenue for next quarter in the range of $4.89 to $4.90 billion, according to CNBC, analysts had expected $5.03 billion.

When analysts see a future that is a bit worse than what they expected, it usually results in a lower stock price and that’s what we are seeing today. It’s worth noting that Salesforce is operating in the same economy as everyone else and being a bit lighter on your projections in the middle of pandemic seems entirely understandable.

In yesterday’s report CEO Marc Benioff indicated that the company has been offering some customers some flexibility around payment as they navigate the economic fallout of COVID-19, and the company’s operating cash took a bit of a hit because of this.

“Operating cash flow was $1.86 billion, which was largely impacted by delayed payments from customers while sheltering in place and some temporary financial flexibility that we granted to certain customers that were most affected by the COVID pandemic,” president and CFO Mark Hawkins explained in the analyst call.

Still, the company reported revenue of $4.87 billion for the quarter, putting it on a run rate of $19.48 billion.

In a statement, David Hynes, Jr of Canaccord Genuity still remained high on Salesforce. “If you step back and think about what Salesforce is actually providing, tools that help businesses get closer to their customers are perhaps more important than ever in a slower-growth, socially distanced world. We have long reserved a spot for CRM among our top names in large cap, and we feel no differently about that view after what we heard last night. This is a high-quality firm with many levers to growth, and as such, we believe CRM is a good way to get a bit of defensive exposure to the favorable trends at play in software.”

The company is after all still firmly on the path to a $20 billion in revenue. As Hynes points out, overall the kinds of tools that Salesforce offers should remain in demand as companies look for ways to digitally transform much more rapidly in our current situation, and look to companies like Salesforce for help.


By Ron Miller

Salesforce’s Benioff pledges no ‘significant’ layoffs for 90 days

In a Twitter thread on Tuesday, Salesforce CEO Marc Benioff outlined an eight-step plan to keep people safe and find treatments and a vaccine for the COVID-19 virus, all while working to find a way to get people back to work safely. He also asked that all CEOs take a 90-day “no lay off” pledge to help everyone get through the crisis.

The same day, he posted another tweet pledging to not make any “significant” layoffs for 90 days. When TechCrunch asked Salesforce to comment on the difference between the two tweets, the company chose not to comment any further on the matter and let the tweets stand on their own.

It sounds like Benioff’s second tweet, which also asked employees to consider paying their own hourly workers like housekeepers and dog walkers throughout the layoff period, whether they were working or not, was designed to give the CEO some wiggle room for at least some layoffs.

Salesforce has almost 50,000 employees worldwide. Even if the company were to lay off just 1% of employees it would equal 500 people without jobs, though it’s not clear if that would count as “significant.” Perhaps more likely, the company might make some cuts to staff for performance or HR-related reasons, but not broad cuts, and thus make both of its CEO’s claims essentially true.

Salesforce is a wildly successful company. It celebrated its 20th anniversary last fall and has grown from a pesky startup to a software behemoth with a projected revenue of over $20 billion for FY2021. It currently has almost $8 billion in cash and equivalents on hand. Certainly companies that use Salesforce’s products will continue to need them, even with the workforce at home.

While it could have an impact on that projection for FY2021 and its ability to land new customers this quarter, it seems like it has the money and revenue to ride out the situation for the short term without making any moves to reduce headcount at this critical time.


By Ron Miller

Even in the age of COVID-19, you need to stay focused on the customer

It’s easy to think, as we find ourselves in the midst of a truly unprecedented situation, that the rules of building a successful business have suddenly changed. While the world may be topsy-turvy at the moment, keeping your customer at the center of your business strategy is more important than ever.

That means finding creative ways to engage with your customers and thinking deeply about what they need as the world changes before our eyes.

As a small example on a local level, Pandemonium Books and Games in Cambridge, Massachusetts has started offering same-day delivery to neighborhoods in the Boston area for a $5 fee and a $20 minimum purchase.

This is taking a difficult situation and finding a way to stay connected with customers, while keeping the business going through difficult times. It’s something that your most loyal customers will certainly remember when we return to some semblance of normalcy — and it’s just a great community service.

When you hear from leaders of the world’s most successful technology companies, whether it’s Jeff Bezos at Amazon or Marc Benioff at Salesforce, these two executives are constantly pushing their organizations to put the customer first.

At Amazon, that manifests itself in the company motto that it’s always Day 1. That motto means they never can become complacent and always place the customer first. In his 2016 Letter to Shareholders, Bezos described what he meant:

There are many ways to center a business. You can be competitor focused, you can be product focused, you can be technology focused, you can be business model focused, and there are more. But in my view, obsessive customer focus is by far the most protective of Day 1 vitality.

Benioff runs his company with a similar world view, and it’s no coincidence that both companies are so wildly successful. In his recent book, Trailblazer, Benioff wrote about the importance of relentless customer focus:

Nothing a company does is more essential than how it engages with customers. In a world where online portals are replacing customer service centers and algorithms are replacing humans on the front lines, companies like ours continually need to show that the personal connections our customers craved were still — and always would be — there.

In our current crisis, that focus becomes ever more important and universal. In his last interview before his death in January, Clayton Christensen, author of the seminal book Innovator’s Dilemma, told MIT Sloan Management Review that while these organizations had other things going for them, customer centricity was certainly a big factor in their success.

They have all built organizations that have put the customers, and their Job to Be Done, at the center. They also have demonstrated the ability to manage emergent strategy well. However, they also have been in the fortunate circumstance where their core businesses have been growing at phenomenal rates, and they have had the presence of the founder to help, to personally get involved in key strategic decisions.

While you don’t want to appear like you are taking advantage of a bad situation, there are ways you can help your customers by thinking of new ways engage and help them in a difficult time. Many companies are offering services for free for the next several months to help customers get through the financial uncertainty we are facing in the near term. Others are posting free content and access to other resources on websites.

While it’s understood that some customers simply won’t have money to spend in the coming months, those that do will have different needs than they did before and you have to be ready to address them, whatever that means to your business.

This virus is going to force us to rethink about a lot of the ways we run our businesses, our society and our lives, but if you keep your customer at the center of all your decisions, even in the midst of such a crisis, you will be setting the foundation for a successful business whenever we return to normal.


By Ron Miller

As Block exits, Salesforce forecasts it will surpass $20B in revenue in FY2021

When Keith Block joined Salesforce from Oracle in 2013, the CRM giant was already a successful SaaS vendor on a billion dollar quarterly revenue cadence. When the co-CEO announced he was stepping down yesterday, the company reported revenue of $4.9 billion for the quarter.

During his tenure, the the company’s scale more than quadrupled, earning an impressive $17.1 billion last year, and as Block announced at the earnings call, the company he was leaving was forecasting revenue of $21 billion for FY2021.

Consider that it was that long ago in May 2017 that we wrote about the company reaching the $10 billion mark. It’s perilously easy to get lost in these numbers, to take them for granted and think they don’t mean as much as they do. It’s hard work to build a billion SaaS business, never mind $10 billion or $20 billion.

Yet Salesforce is embarking on unchartered territory for a SaaS company. It’s approaching $20 billion in revenue for a single year.

Growth through acquisition

Granted the company keeps growing revenue by making big deals like buying Mulesoft for $6.5 billion in 2018 or Tableau for $15.7 billion in 2019, or just this week buying Vlocity for a mere $1.33 billion. That means the company spent more than $25 billion over a couple of years to buy substantial companies that help them build their business.

Block took a moment to brag a bit about his accomplishments including how some of those purchases performed during his swan song call with Salesforce, calling it a capstone of his time at Salesforce.

“In Q4, we grew 32% in the Americas, 28% in APAC and 47% in EMEA in constant currency. Now that includes our recent acquisitions. And at the close of FY 2020, the number of Salesforce customers spending $20 million annually grew 34%,” he said.

Think about that last number for just a minute. This a SaaS vendor with the number of customers spending $20 million growing by 34%. Block helped orchestrate that growth and worked with the executive team to help determine which companies it should be targeting.

At a press conference in 2016 at Dreamforce, he discussed Salesforce’s acquisition strategy. At the time, it had bought a 10 of a dozen companies it would end up acquiring that year. It would buy only in one 2017, before revving up again 2018. Here’s what he said about what they look for in a company, as we reported in an article at the time:

“We look at culture. Will it be a good cultural fit? Is it a good product fit? Is there talent? Is there financial value? What are the risks of assimilating the company into our company,” Block explained.

What’s next for Block?

There is no word on what Block will do next beyond acting as an advisor to his former co-CEO Marc Benioff, who took time in the earnings call to thank his colleague for his time at Salesforce. As well, he should.

As Ray Wang, founder and principal analyst point out, Block leaves a big hole as he steps away. “If there is no equivalent replacement, you will see a significant impact in sales. Keith brought industries and sales discipline,” Wang told TechCrunch

It will be interesting to watch what he does next, and who, if anyone, will benefit from his vast experience helping to build the most successful pure SaaS company on the planet.


By Ron Miller

Salesforce co-CEO Keith Block steps down

Salesforce today announced that Keith Block, the company’s co-CEO, is stepping down. This leaves company founder Marc Benioff as the sole CEO and chair of the CRM juggernaut. Block’s bio has already been wiped from Salesforce’s leadership page.

Block stepped into the co-CEO role in 2018, after a long career at the company that saw him become vice chairman, president and director before he took this position. Block spent the early years of his career at Oracle . He left there in 2012 after the release of a number of documents in which he criticized then-Oracle CEO Mark Hurd, who passed away last year.

Industry pundits saw his elevation to the co-CEO role as a sign that Block was next in line as the company’s sole CEO in the future (assuming Benioff would ever step down). After this short tenure as co-CEO, it doesn’t look like that will be the case, but for the time being, Block will stay on as an advisor to Benioff.

“It’s been my greatest honor to lead the team with Marc [Benioff] that has more than quadrupled Salesforce from $4 billion of revenue when I joined in 2013 to over $17 billion last year,” said Block in a canned statement that was surely not written by the Salesforce PR team. “We are now a global enterprise company, focused on industries, and have an ecosystem that is the envy of the industry, and I’m so grateful to our employees, customers, and partners. After a fantastic run I am ready for my next chapter and will stay close to the company as an advisor. Being side-by-side with Marc has been amazing and I’m forever grateful for our friendship and proud of the trajectory the company is on.”

In related news, the company also today announced that it has named former BT Group CEO Gavin Patterson as its president and CEO of Salesforce International.


By Frederic Lardinois

Revenue train kept rolling all year long for Salesforce

Salesforce turned 20 this year, and the most successful pure enterprise SaaS company ever showed no signs of slowing down. Consider that the company finished the year on an $18 billion run rate, rushing toward its 2022 revenue goal of $20 billion. Oh, and it also spent a tidy $15.7 billion to buy Tableau this year in the most high-profile and expensive acquisition it’s ever made.

Co-founder, chairman and CEO Marc Benioff published a book called Trailblazer about running a socially responsible company, and made the rounds promoting it. In fact, he even stopped by TechCrunch Disrupt in San Francisco in September, telling the audience that capitalism as we know it is dead. Still, the company announced it was building two more towers in Sydney and Dublin.

It also promoted Bret Taylor just last week, who could be in line as heir apparent to Benioff and co-CEO Keith Block whenever they decide to retire. The company closed the year with a bang with a $4.5 billion quarter. Salesforce, for the most part, has somehow been able to balance Benioff’s vision of responsible capitalism while building a company makes money in bunches, one that continues to grow and flourish, and that’s showing no signs of slowing down anytime soon.

All aboard the gravy train

The company just keeps churning out good quarters. Here’s what this year looked like:


By Ron Miller

Salesforce announces it’s moving Marketing Cloud to Microsoft Azure

In the world of enterprise software, there are often strange bedfellows. Just yesterday, Salesforce announced a significant partnership with AWS around the Cloud Information Model. This morning, it announced it was moving its Marketing Cloud to Microsoft Azure. That’s the way that enterprise partnerships shimmy and shake sometimes.

The companies also announced they were partnering around Microsoft Teams, integrating Teams with Salesforce Sales Cloud and Service Cloud.

Salesforce plans to move Marketing Cloud, which has been running in its own data centers, to Microsoft Azure in the coming months, although the exact migration plan timeline is not clear yet. This is a big deal for Microsoft, which competes fiercely with AWS for customers. AWS is the clear market leader in the space, but Microsoft has been a strong second for some time now, and bringing Salesforce on board as a customer is certainly a quality reference for the company.

Brent Leary, founder at CRM Essentials, who has been watching the market for many years, says the partnership says a lot about Microsoft’s approach to business today, and that it’s willing to partner broadly to achieve its goals. “I think the bigger news is that Salesforce chose to go deeper with Microsoft over Amazon, and that Microsoft doesn’t fear strengthening Salesforce at the potential expense of Dynamics 365 (its CRM tool), mainly because their biggest growth driver is Azure,” Leary told TechCrunch.

Microsoft and Salesforce have always had a complex relationship. In the Steve Ballmer era, they traded dueling lawsuits over their CRM products. Later, Satya Nadella kindled a friendship of sorts by appearing at Dreamforce in 2015. The relationship has ebbed and flowed since, but with this announcement, it appears the frenemies are closer to friends than enemies again.

Let’s not forget though, that it was just yesterday that Salesforce announced a partnership with AWS around the Cloud Information Model, one that competes directly with a different partnership between Adobe, Microsoft and SAP; or that just last year AWS announced a significant partnership with AWS around data integration.

These kinds of conflicting deals are confusing, but they show that in today’s connected cloud world, that companies who will compete hard with one another in one part of the market, may still be willing to partner in other parts when it makes sense for both parties and for customers. That appears to be the case with today’s announcement from these companies.


By Ron Miller

TechCrunch Disrupt offers plenty of options for attendees with an eye on the enterprise

We might have just completed a full-day program devoted completely to enterprise at TechCrunch Sessions: Enterprise last week, but it doesn’t mean we plan to sell that subject short at TechCrunch Disrupt next month in San Francisco. In fact, we have something for everyone from startups to established public companies and everything in between along with investors and industry luminaries to discuss all-things enterprise.

SaaS companies have played a major role in enterprise software over the last decade, and we are offering a full line-up of SaaS company executives to provide you with the benefit of their wisdom. How about Salesforce chairman, co-CEO and co-founder Marc Benioff for starters? Benioff will be offering advice on how to build a socially responsible, successful startup.

If you’re interested in how to take your startup public, we’ll have Box CEO Aaron Levie, who led his company to IPO in 2015 and Jennifer Tejada, CEO at PagerDuty, who did the same just this year. The two executives will discuss the trials and tribulations of the IPO process and what happens after you finally go public.

Meanwhile, Slack co-founder and CTO Cal Henderson, another SaaS company that recently IPOed, will be discussing how to build great products with Megan Quinn from Spark Capital, a Slack investor.

Speaking of investors, Neeraj Agrawal, a general partner at Battery Ventures joins us on a panel with Whitney Bouck, COO at HelloSign and Jyoti Bansal, CEO and founder of Harness (as well as former CEO and co-founder at AppDynamics, which was acquired by Cisco in 2017 for $3.7 billion just before it was supposed to IPO). They will be chatting about what it takes to build a billion dollar SaaS business.

Not enough SaaS for you? How about Diya Jolly, Chief Product Officer at Okta discussing how to iterate your product?

If you’re interested in security, we have Dug Song from Duo, whose company was sold to Cisco in 2018 for $2.35 billion, explaining how to develop a secure startup. We will also welcome Nadav Zafrir from Israeli security incubator Team 8 to talk about the intriguing subject of when spies meet security on our main stage.

You probably want to hear from some enterprise company executives too. That’s why we are bringing Frederic Moll, chief development officer for the digital surgery group at Johnson & Johnson to talk about robots, Marillyn A. Hewson, chairman, president and CEO at Lockheed Martin discussing the space industry and Verizon CEO Hans Vestberg going over the opportunity around 5G.

We’ll also have seasoned enterprise investors, Mamoon Hamid from Kleiner Perkins and Michelle McCarthy from Verizon Ventures, acting as judges at the TechCrunch Disrupt Battlefield competition.

If that’s not enough for you, there will also be enterprise startups involved in the Battlefield and Startup Alley. If you love the enterprise, there’s something for everyone. We hope you can make it.

Still need tickets? You can pick those up right here.



By Ron Miller

Marc Benioff will discuss building a socially responsible and successful startup at TechCrunch Disrupt

Salesforce chairman, co-founder and CEO, Marc Benioff, took a lot of big chances when he launched the company 20 years ago. For starters, his was one of the earliest enterprise SaaS companies, but he wasn’t just developing a company on top of new platform, he was building one from scratch with social responsibility built-in.

Fast forward 20 years and that company is wildly successful. In its most recent earnings report, it announced a $4 billion quarter, putting it on a $16 billion run rate, and making it by far the most successful SaaS company ever.

But at the heart of the company’s DNA is a charitable streak, and it’s not something they bolted on after getting successful. Even before the company had a working product, in the earliest planning documents, Salesforce wanted to be a different kind of company. Early on, it designed the 1-1-1 philanthropic model that set aside one percent of Salesforce’s equity, and one percent of its product and one percent of its employees’ time to the community. As the company has grown, that model has serious financial teeth now, and other startups over the years have also adopted the same approach using Salesforce as a model.

In our coverage of Dreamforce, the company’s enormous annual customer conference, in 2016, Benioff outlined his personal philosophy around giving back:

“You are at work, and you have great leadership skills. You can isolate yourselves and say I’m going to put those skills to use in a box at work, or you can say I’m going to have an integrated life. The way I look at the world, I’m going to put those skills to work to make the world a better place,” Benioff said at the time.

This year Benioff is coming to TechCrunch Disrupt in San Francisco to discuss with TechCrunch Editors how to build a highly successful business, while giving back to the community and the society your business is part of. In fact, he has a book coming out in mid-October called Trailblazer: The Power of Business as the Greatest Platform for Change, in which he writes about how businesses can be a positive social force.

Benioff has received numerous awards over the years for his entrepreneurial and charitable spirit including Innovator of the Decade from Forbes, one of the World’s 25 Greatest Leaders from Fortune, one of the 10 Best-Performing CEOs from Harvard Business Review, GLAAD, the Billie Jean King Leadership Initiative for his work on equality and the Variety Magazine EmPOWerment Award.

Disrupt SF runs October 2 to October 4 at the Moscone Center in the heart of San Francisco. Tickets are available here.

Did you know Extra Crunch annual members get 20% off all TechCrunch event tickets? Head over here to get your annual pass, and then email [email protected] to get your 20% off discount. Please note that it can take up to 24 hours to issue the discount code.



By Ron Miller

The Exit: The acquisition charting Salesforce’s future

Before Tableau was the $15.7 billion key to Salesforce’s problems, it was a couple of founders arguing with a couple of venture capitalists over lunch about why its Series A valuation should be higher than $12 million pre-money.

Salesforce has generally been one to signify corporate strategy shifts through their acquisitions, so you can understand why the entire tech industry took notice when the cloud CRM giant announced its priciest acquisition ever last month.

The deal to acquire the Seattle-based data visualization powerhouse Tableau was substantial enough that Salesforce CEO Marc Benioff publicly announced it was turning Seattle into its second HQ. Tableau’s acquisition doesn’t just mean big things for Salesforce. With the deal taking place just days after Google announced it was paying $2.6 billion for Looker, the acquisition showcases just how intense the cloud wars are getting for the enterprise tech companies out to win it all.

The Exit is a new series at TechCrunch. It’s an exit interview of sorts with a VC who was in the right place at the right time but made the right call on an investment that paid off. [Have feedback? Shoot me an email at [email protected]]

Scott Sandell, a general partner at NEA (New Enterprise Associates) who has now been at the firm for 25 years, was one of those investors arguing with two of Tableau’s co-founders, Chris Stolte and Christian Chabot. Desperate to close the 2004 deal over their lunch meeting, he went on to agree to the Tableau founders’ demands of a higher $20 million valuation, though Sandell tells me it still feels like he got a pretty good deal.

NEA went on to invest further in subsequent rounds and went on to hold over 38% of the company at the time of its IPO in 2013 according to public financial docs.

I had a long chat with Sandell, who also invested in Salesforce, about the importance of the Tableau deal, his rise from associate to general partner at NEA, who he sees as the biggest challenger to Salesforce, and why he thinks scooter companies are “the worst business in the known universe.”

The interview has been edited for length and clarity. 


Lucas Matney: You’ve been at this investing thing for quite a while, but taking a trip down memory lane, how did you get into VC in the first place? 

Scott Sandell: The way I got into venture capital is a little bit of a circuitous route. I had an opportunity to get into venture capital coming out of Stanford Business School in 1992, but it wasn’t quite the right fit. And so I had an interest, but I didn’t have the right opportunity.


By Lucas Matney

As Alzheimer’s costs soar, startups like Neurotrack raise cash to diagnose and treat the disease

As studies show that early diagnosis and preventative therapies can help prevent the onset of Alzheimer’s, startups that are working to diagnose the disease earlier are gaining more attention and funding.

That’s a boon to companies like Neurotrack, which closed on $21 million in new financing led by the company’s previous investor, Khosla Ventures, with participation from new investors Dai-ichi Life and SOMPO Holdings.

Last year, the Japanese life insurance company, Dai-ichi Life partnered with Neurotrack to roll out a cognitive assessment tool to the company’s customers in Japan.

And earlier this year, the Japanese health insurer, SOMPO conducted a 16-week pilot with Neurotrack, where more than 550 of SOMPO’s employees took Neurotrack’s test and followed the Memory Health Program for four months. Neurotrack and SOMPO are now working to deepen and extend their partnership.

“As the global crisis around Alzheimer’s continues to grow, the private sector is joining government and nonprofits to address the problem in their markets. In Japan, for example, traditional insurance companies are developing novel solutions that incorporate Neurotrack’s products to advance better memory health among its population,” said Elli Kaplan, Neurotrack Co-founder and CEO. “These partnerships are innovative models that we hope to replicate in other markets, enabling traditional insurance companies to create new markets while helping to address the Alzheimer’s crisis. And now they’re also investing in our company so these companies have two ways of doing well by doing good.”

Neurodegenerative disorders are becoming a more serious issue for the island nation — and the rest of the world. In fact, over the weekend the G20 first raised the possibility that aging populations could be a global risk.

“Most of the G20 nations already experience or will experience ageing,” Bank of Japan governor Haruhiko Kuroda, told reporters from Agence France Presse. “We need to discuss problems that arise with societal aging and how to deal with them.”

In the U.S., the estimated cost of caring for Americans with Alzheimer’s and other dementias was an estimated $277 billion in 2018, according to a study cited by WebMD. Roughly $186 billion of those costs are borne by Medicare and Medicaid with another $60 billion in payments coming out-of-pocket. That number could top $1.1 trillion by 2050, according to the same report.

Neurotrack uses cognitive assessments that follow eye movements using the camera on a computer or mobile phone to create a baseline for cognitive functions. The company then uses a combination of brain training and diet, exercise, and sleep adjustments to try and improve cognitive function and health.

Its technology is one of several different approaches startups are taking to try and provide early diagnoses and potential preventative measures against the disease.

MyndYou is another company tackling neurodegenerative diagnostics uses an app to monitor movement among its users. The company assesses that data to determine whether there may be any issues related to cognitive function.  It recently partnered with the Japanese company Mizuho to test its efficacy among Japan’s aging population.

MyndYou partners with Mizuho to expand senior care services assessing cognitive degeneration

Then there’s Altoida, another startup which launched recently to tackle the cognitive assessment market. It uses augmented reality and a series of memory tests to assess brain function and attempt to detect neurodegeneration.

Neurotrack’s technology, based on research from Emory University, has managed to attract more than just Japanese corporations. Previous investors like Sozo Ventures, Rethink Impact, AME Cloud Partners, and Salesforce founder Marc Benioff have also thrown cash behind the company.

To date, the company has raised more than $50 million including $6.8 million in grants from the National Institutes of Health and National Institute of Aging.

The company said its new investment will be used to develop new partnerships in additional global markets and continue research and development.

“One can now feel empowered to test for potential memory decline, given that Neurotrack’s Memory Health Program can help stave off cognitive decline. This fully integrated platform enables users to assess the state of their memory, reduce future risk for decline, and monitor progress in order to take better control of one’s memory health. We combine these tools with deep analytics to further target and personalize, creating a very powerful precision medicine solution,” said Kaplan. “Just as when you go on a diet, you use a scale to provide evidence that you’re losing weight. Neurotrack now has the equivalent of both a scale to measure and the Memory Health Program for cognitive health. This is a game-changer for dementia risk.”

Japan has national efforts targeting a reduction in the onset of dementia in 6% of people in their 70s by 2025 (the country has the world’s largest population of the elderly with over 20% of the country over the age of 65). Roughly 13 million people are expected to develop Alzheimer’s in Japan by 2025.

Using augmented reality, Altoida is identifying the likely onset of neurodegenerative diseases

Part of the company’s success in fundraising comes from the results of a preliminary study that showed improved cognitive functions for people diagnosed with some decline in cognitive function after a year of using Neurotrack’s Memory Health Program. The company claims it has the the first fully integrated, clinically-validated platform that can assess a person’s cognition through its cognitive assessment — which can predict conversion from healthy to mild cognitive impairment (MCI) or MCI to Alzheimer’s disease within 3 years at 89% accuracy, and within 6 years at 100% accuracy.

While that kind of assessment is good, Alzheimer’s symptoms can begin to appear as early as 25 years before the onset of the disease. So there’s still work to be done.

“Neurotrack has built an incredible integrative platform that is transforming our battle with Alzheimer’s,” said Jenny Abramson, Founder & Managing Partner of Rethink Impact. “Elli’s two decades of experience in the private sector and in government are helping her scale this solution to the millions of people suffering from cognitive decline around the world. We couldn’t be more excited to continue to support Neurotrack, given both the financial opportunity and the impact they are already having on this critical disease.”


By Jonathan Shieber