May
17
2018
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Rackspace acquires Salesforce specialist RelationEdge

Rackspace today announced that it has acquired RelationEdge, a Salesforce implementation partner and digital agency. The companies did not disclose the financial details of the acquisition.

At first, this may sound like an odd acquisition. Rackspace is still best known for its hosting and managed cloud and infrastructure services, after all, and RelationEdge is all about helping businesses manage their Salesforce SaaS implementations. The company clearly wants to expand its portfolio, though, and add managed services for SaaS applications to its lineup. It made the first step in this direction with the acquisition of TriCore last year, another company in the enterprise application management space. Today’s acquisition builds upon this theme.

Gerard Brossard, the executive VP and general manager of Rackspace Application Services, told me that the company is still in the early days of its application management practice, but that it’s seeing good momentum as it’s gaining both new customers thanks to these offerings and as existing customers look to Rackspace for managing more than their infrastructure. “This allows us to jump into that SaaS management practice, starting with the leaders in the market,” he told me.

Why sell RelationEdge, a company that has gained some good traction and now has about 125 employees? “At the end of the day, we’ve accomplished a tremendous amount organically with very little funding,” RelationEdge founder and CEO Matt Stoyka told me. “But there is a huge opportunity in the space that we can take advantage of. But to do that, we needed more than was available to us, but we needed to find the right home for our people and our company.” He also noted that the two companies seem to have a similar culture and mission, which focuses more on the business outcomes than the technology itself.

For the time being, the RelationEdge brand will remain and Rackspace plans to run the business “with considerable independence under its current leadership.” Brossard noted that the reason for this is RelationEdge’s existing brand recognition.

May
15
2018
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HPE buys Plexxi to expand its hybrid cloud solutions

Just days after Google announced that it would acquire Velostrata to help customers migrating more of their operations into cloud environments, HPE under its new CEO Antonio Neri is also upping its game in the same department. Today the company announced that it would acquire Plexxi, a specialist in software-defined data center solutions, aimed at optimising application performance for enterprises that are using hybrid cloud environments.

A spokesperson confirmed that the companies are not currently revealing the terms of the deal, which is expected to close in the third quarter of 2018 (ending July 31). Plexxi has 100 employees and all will be joining HPE, a spokesperson said. A role for Rich Napolitano, Plexxi’s CEO who joined after having been the president of EMC, “is still being finalized.”

For some context and a possible price range for this deal, Plexxi, founded in 2010, was last valued at around $267 million as of its last financing round, more than two years ago in January 2016, according to PitchBook. And the previous cloud infrastructure acquisition HPE made, of SimpliVity over a year ago, was for $650 million. Plexxi’s investors included GV (formerly Google Ventures), Lightspeed Venture Partners, Matrix and more.

Cloud services — propelled by the rise of mobile hardware with less on-device storage, advances at major platforms like AWS, Microsoft’s Azure and Google, and the rise of companies like Box to help manage cloud services — have exploded in their ubiquity as a way to deliver and store software and data among enterprises.

But many organizations are, in fact, not throwing all of their eggs into the clouds, so to speak, and are taking a more gradual path to migrate some or all of their IP out of on-premises-based solutions.

This, in turn, has given rise to a second market for hybrid cloud services, deployments that are more flexible and allow for a mix of legacy and on-premises hardware alongside more modern distributed architectures. HPE and Google are not the only ones building solutions to address that market: Microsoft, Dell, Accenture, NTT, and many more have also made large investments to cover these different bases.

And that has proven popular not just with vendors — but with enterprises as well. BCC today released a report that estimates hybrid cloud services could reach a market size of $98.8 billion globally by 2022.

Ric Lewis, the VP & GM of HPE’s software-defined and cloud group, said that the plan will be to integrate Plexxi into HPE’s existing products in two areas.

The first of these is in the company’s hyperconverged solutions business, where HPE’s acquisition of SimpliVity also sites. “Plexxi will enable us to deliver the industry’s only hyperconverged offering that incorporates compute, storage and data fabric networking into a single solution, with a single management interface and support,” he wrote in a blog post.

The second of these will be to bring Plexxi’s HCN tech to HPE Synergy and its composable infrastructure business. This, Lewis explained, is “a new category of infrastructure that delivers fluid pools of storage and compute resources that can be composed and recomposed as business needs dictate.” Plexxi will enable this approach to extend also to rack-based solutions in private clouds.

“Plexxi and HPE’s values and vision for the future are closely aligned,” Plexxi CEO Rich Napolitano wrote in his own announcement. “We share the same mission, to help the enterprise effectively leverage modern IT to accelerate their business in the digital age.”

While the two wait for the deal to close, it seems to be business as usual for Plexxi. Just earlier today, the company announced an expansion of its integrations with VMware.

Updated with more detail from Plexxi.

 

May
01
2018
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Cisco is acquiring business intelligence startup Accompany for $270M

Cisco just announced an agreement to acquire Accompany, which uses artificial intelligence to build databases of people and relationships at companies.

Founder and CEO Amy Chang has compared the product to a digital chief of staff or personal assistant, giving executives the context they need before conversations and meetings. Cisco plans to incorporate Accompany technology into its collaboration products, for example by introducing company and individual profiles into Webex meetings.

Cisco says it will pay $270 million in cash and stock in the deal.

The company probably didn’t have to search too hard to find Accompany, since Chang (who previously served as the head of product for Google’s ad measurement and reporting) has been on Cisco’s board of directors since October 2016. As part of the transaction, she’s resigning from the board, effective immediately.

In addition, Chang will be taking over the company’s Collaboration Technology Group. Rowan Trollope, who currently leads the collaboration group, is departing to become CEO at cloud software company Five9.

“Amy has proven to be an effective and innovative leader through her years as an entrepreneur, an engineer, and CEO, and I couldn’t be more pleased to have her and the Accompany team join Cisco,” said Cisco chairman and CEO Chuck Robbins in the announcement. “Together, we have a tremendous opportunity to further enhance AI and machine learning capabilities in our collaboration portfolio and continue to create amazing collaboration experiences for customers.”

According to Crunchbase, Accompany has raised around $40 million in funding from investors including CRV, Cowboy Ventures, Iconiq Capital and Ignition Partners.

Cisco also announced today that it’s selling off some of its NDS video assets.

Apr
03
2018
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InVision acquires design visibility tool Wake

InVision, the NY-based design platform focused on collaboration, has today announced the acquisition of Wake.

Wake is a design tool focused squarely on supporting design visibility throughout a particular organization. Wake allows companies to share design assets and view work in progress as designers build out their screens, logos, or other designs. Design team leaders, or other higher-ups at the company, can upvote certain design projects or give feedback on specific tweaks.

InVision CEO Clark Valberg said that one of the most attractive features of Wake is that sharing on the Wake platform was implicit, rather than on InVision where designers have to take an extra step to upload their prototypes on InVision.

Wake will continue to operate independently within InVision, and Valberg has plans to integrate some of the Wake tools into the InVision core product. Moreover, as part of the deal, Wake will be introducing a free tier.

“We’re in the midst of a shift,” said CEO Clark Valberg. “The screen is the most important place in the world. Every company is now a digital product company. The world of design is growing and the Wake product represents a very interesting philosophical vector of that market.”

The entire Wake team will join InVision. Wake was founded in 2013 by Chris Kalani and Johan Bakken, with a customer list that includes Capital One, Spotify, Palantir, Stripe, and Airbnb. In fact, InVision’s Valberg said that Wake’s customer overlap with InVision was one of the first things that alerted InVision to Wake.

Wake has raised a total of $3.8 million, with investments from First Round and Designer Fund.

The terms of the deal were not disclosed.

Mar
28
2018
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Salesforce introduces Integration Cloud on heels of MuleSoft acquisition

Salesforce hasn’t wasted any time turning the MuleSoft acquisition into a product of its own, announcing the Salesforce Integration Cloud this morning.

While in reality it’s too soon to really take advantage of the MuleSoft product set, the company is laying the groundwork for the eventual integration into the Salesforce family with this announcement, which really showcases why Salesforce was so interested in them that they were willing to fork over $6.5 billion.

The company has decided to put their shiny new bauble front and center in the Integration Cloud announcement, so that when they are in the fold, they will have a place for them to hit the ground running

The Integration Cloud itself consists of three broad pieces: The Integration Platform, which will eventually be based on MuleSoft; Integration Builder, a tool that lets you bring together a complete picture of a customer from Salesforce tools, as well as across other enterprise data repositories and finally Integration Experiences, which is designed to help brands build customized experiences based on all the information you’ve learned from the other tools.

For now, it involves a few pieces that are independent of MuleSoft including a workflow tool called Lightning Flow, a new service that is designed to let Salesforce customers build workflows using the customer data in Salesforce CRM.

It also includes a dash of Einstein, Salesforce’s catch-all brand for the intelligence layer that underlies the platform, to build Einstein intelligence into any app.

Salesforce also threw in some Trailhead education components to help customers understand how to best make use of these tools.

But make no mistake, this is a typical Salesforce launch. It is probably earlier than it should be, but it puts the idea of integration out there in the minds of its customers and lays a foundation for a much deeper set of products and services down the road when MuleSoft is more fully integrated into the Salesforce toolset.

For now, it’s important to understand that this deal is about using data to fuel the various pieces of the Salesforce platform and provide the Einstein intelligence layer with information from across the enterprise wherever it happens to live, whether that’s in Salesforce, another cloud application or some on-prem legacy systems.

This should sound familiar to folks attending the Adobe Summit this week in Las Vegas, since it’s eerily similar to what Adobe announced on stage yesterday at the Summit keynote. Adobe is calling it a customer experience system of record, but the end game is pretty much the same: bringing together data about a customer from a variety of sources, building a single view of that customer, and then turning that insight into a customized experience.

That they chose to make this announcement during the Adobe Summit, where Adobe has announced some data integration components of its own could be a coincidence, but probably not.

Mar
20
2018
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Salesforce is buying MuleSoft at enterprise value of $6.5 billion

Salesforce announced today that it intends to buy MuleSoft in a deal valued at a whopping $6.5 billion. That’s not necessarily the selling price, but the amount the company has been valued at based on stocks, bonds and cash on hand. The exact price was not available yet, but the company did indicate it was paying $44.89 per share for MuleSoft, a price that represents a 36 percent premium over yesterday’s closing price, according to Salesforce .

What’s more, the deal values each MuleSoft share at $36 in cash and 0.0711 shares of Salesforce common stock.

Rumors began swirling this morning after a story broke by Reuters that the CRM giant was interested in MuleSoft, which launched in 2006 and went public almost exactly a year ago. With 1,200 customers, it gives Salesforce a mature company to add to its arsenal. It also gives them an API integration engine that should help the company access data across organizations, regardless of where it lives.

This is particularly important for Salesforce, which tends to come in and work with a company across enterprise systems. As it builds out its artificial intelligence and machine learning layer, which it has branded as Einstein, it needs access to data across the company. A company like MuleSoft gives them that.

But of course Salesforce gets more than tech with this purchase, which it can integrate into its growing family of products. It also gets major customers like Coca-Cola, VMware, GE, Accenture, Airbus, AT&T and Cisco. While Salesforce may have a presence in some of these companies already, MuleSoft gives them entrée into areas they might not have had, and gives them the ability to expand that presence.

What’s more, the company has big revenue goals. Having reached $10 billion in revenue faster than any software company ever has, a point that chairman and co-founder Marc Benioff has been happy to make, they have actually set their sights on $60 billion by 2034. That’s a long way away, of course, but having a company like MuleSoft in the fold, which made almost $300 million in revenue in fiscal 2017, will certainly help.

Ray Wang, founder and principal analyst at Constellation Research, says this about building a microservices future, “This is the heart of Salesforce’s M&A strategy. They have to integrate, orchestrate, and manage microservices in their future roadmap,” he said. “The AI-driven world ahead needs contextual microservices.”

Microservices are a way of building applications made up of small, distinct pieces, rather than the single, monolithic application we tended to build in the past. This makes changing and updating easier and more efficient.

Brent Leary, owner and principal at CRM Essentials, a CRM consulting firm, sees the deal through a customer prism. “Well, it shows just how crucial [Internet of Things] and [Artificial Intelligence] is to the future of Salesforce‘s ability to create the customer success platform of the future,” he said.

“It also reinforces that they feel investing deeper into customer success is a better ROI and growth play then extending to other enterprise app areas outside of their core focus,” Leary added.

As with all deals of this ilk, it needs to pass regulatory muster first, but if it does, it is expected to close at the end July.

Mar
07
2018
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S&P Global snares Kensho for $550 million

S&P Global announced today that it will acquire Kensho, a Cambridge, Massachusetts startup that has concentrated on artificial intelligence and analytics for big financial institutions. The total value of the deal is $550 million in a mix of cash and stock.

Kensho, which counted S&P Global as a client/partner and an investor, launched in 2013 and has raised $67.5 million, according to Crunchbase. The most recent funding round was in fact led by S&P Global for $50 million in February 2017. They apparently liked Kensho so much, they bought the company.

“In just a short amount of time, Kensho’s intuitive platforms, sophisticated algorithms and machine learning capabilities have established a wide following throughout Wall Street and the technology world,” S&P global president and CEO Douglas Peterson said in a statement announcing the deal.

The company doesn’t have small goals. Its stated mission involves solving some of the biggest analytical problems of our time — no pressure or anything. In additional to financial services, the company also has a division called Koto, which concentrates on national security.

As you would expect in a deal like this, Kensho sees S&P Global providing it with financial resources it couldn’t provide alone through conventional funding channels. To solve those big artificial intelligence problems requires world-class engineers, and that requires an owner or investor with deep pockets. They got that with today’s announcement.

The good news for Kensho and its customers is that S&P Global intends to mostly leave it alone and let it do what it’s been doing. It will continue to operate as an independent brand out of its Cambridge offices.

Per usual, the deal is going to be subject to regulatory approval before it closes, but it’s not every day you have a company be your client, your investor and your owner, but that’s what happened to Kensho today as it scored the investment hat trick.

Feb
20
2018
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Adecco Group acquires recruiting startup Vettery for $100M

Vettery founders The Adecco Group, a global HR services firm headquartered in Switzerland, announced today that it has acquired Vettery. The financial terms were not disclosed, but a source with knowledge of the deal told us that the price was a little over $100 million. (It’s not clear how much of that is cash versus stock.) Read More

Feb
16
2018
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Oracle grabs Zenedge as it continues to beef up its cloud security play

 Oracle announced yesterday that it intends to acquire Zenedge, a 4-year old hybrid security startup. They didn’t reveal a purchase price. With Zenedge, Oracle gets a security service to add it to its growing cloud play. In this case, the company has products to protect customers whether in the cloud, on-prem or across hybrid environments. The company offers a range of services from… Read More

Feb
12
2018
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Billionaire investors Icahn and Deason write blog post slamming Xerox-Fuji deal

 Carl Icahn and Darwin Deason are a couple of seasoned billionaire investors, who know a bad deal when they see it, and they definitely don’t like the $6.1 billion deal announced last month to combine Fuji with Xerox. In a blog post published today, they are urging fellow shareholders to reject the offer. You may recall that it was Icahn and Deason, who together own a 15 percent stake in… Read More

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