Aug
19
2019
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The five great reasons to attend TechCrunch’s Enterprise show Sept. 5 in SF

The vast enterprise tech category is Silicon Valley’s richest, and today it’s poised to change faster than ever before. That’s probably the biggest reason to come to TechCrunch’s first-ever show focused entirely on enterprise. But here are five more reasons to commit to joining TechCrunch’s editors on September 5 at San Francisco’s Yerba Buena Center for an outstanding day (agenda here) addressing the tech tsunami sweeping through enterprise. 

No. 1: Artificial intelligence
At once the most consequential and most hyped technology, no one doubts that AI will change business software and increase productivity like few, if any, technologies before it. To peek ahead into that future, TechCrunch will interview Andrew Ng, arguably the world’s most experienced AI practitioner at huge companies (Baidu, Google) as well as at startups. AI will be a theme across every session, but we’ll address it again head-on in a panel with investor Jocelyn Goldfein (Zetta), founder Bindu Reddy (Reality Engines) and executive John Ball (Salesforce / Einstein). 

No. 2: Data, the cloud and Kubernetes
If AI is at the dawn of tomorrow, cloud transformation is the high noon of today. Indeed, 90% of the world’s data was created in the past two years, and no enterprise can keep its data hoard on-prem forever. Azure’s CTO
Mark Russinovitch will discuss Microsft’s vision for the cloud. Leaders in the open-source Kubernetes revolution — Joe Beda (VMware), Aparna Sinha (Google) and others — will dig into what Kubernetes means to companies making the move to cloud. And last, there is the question of how to find signal in all the data — which will bring three visionary founders to the stage: Benoit Dageville (Snowflake), Ali Ghodsi (Databricks) and Murli Thirumale (Portworx). 

No. 3: Everything else on the main stage!
Let’s start with a fireside chat with
SAP CEO Bill McDermott and Qualtrics Chief Experience Officer Julie Larson-Green. We have top investors talking where they are making their bets, and security experts talking data and privacy. And then there is quantum computing, the technology revolution waiting on the other side of AI: Jay Gambetta, the principal theoretical scientist behind IBM’s quantum computing effort, Jim Clarke, the director of quantum hardware at Intel Labs and Krysta Svore, who leads Microsoft’s quantum effort.

All told, there are 21 programming sessions.

No. 4: Network and get your questions answered
There will be two Q&A breakout sessions with top enterprise investors; this is for founders (and anyone else) to query investors directly. Plus, TechCrunch’s unbeatable CrunchMatch app makes it really easy to set up meetings with the other attendees, an
incredible array of folks, plus the 20 early-stage startups exhibiting on the expo floor.

No. 5: SAP
Enterprise giant SAP is our sponsor for the show, and they are not only bringing a squad of top executives, they are producing four parallel track sessions, featuring key SAP Chief Innovation Officer
Max Wessel, SAP Chief Designer and Futurist Martin Wezowski and SAP.IO’s managing director Ram Jambunathan (SAP.iO), in sessions including how to scale-up an enterprise startup, how startups win large enterprise customers, and what the enterprise future looks like.

Check out the complete agenda. Don’t miss this show! This line-up is a view into the future like none other. 

Grab your $349 tickets today, and don’t wait til the day of to book because prices go up at the door!

We still have two Startup Demo Tables left. Each table comes with four tickets and a prime location to demo your startup on the expo floor. Book your demo table now before they’re all gone!

Aug
07
2019
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Salesforce is acquiring ClickSoftware for $1.35B

Another day, another Salesforce acquisition. Just days after closing the hefty $15.7 billion Tableau deal, the company opened its wallet again, this time announcing it has bought field service software company ClickSoftware for a tidy $1.35 billion.

This one could help beef up the company’s field service offering, which falls under the Service Cloud umbrella. In its June earnings report, the company reported that Service Cloud crossed the $1 billion revenue threshold for the first time. This acquisition is designed to keep those numbers growing.

“Our acquisition of ClickSoftware will not only accelerate the growth of Service Cloud, but drive further innovation with Field Service Lightning to better meet the needs of our customers,” Bill Patterson, EVP and GM of Salesforce Service Cloud said in a statement announcing the deal.

ClickSoftware is actually older than Salesforce having been founded in 1997. The company went public in 2000, and remained listed until it went private again in 2015 in a deal with private equity company Francisco Partners, which bought it for $438 million. Francisco did alright for itself, holding on to the company for four years before more than doubling its money.

The deal is expected to close in the fall and is subject to the normal regulatory approval process.

Aug
01
2019
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Salesforce closes $15.7B Tableau deal

In an amazingly quick turnaround for a deal of this scope, Salesforce announced today that it has closed the $15.7 billion Tableau deal announced in June. The deal is by far the biggest acquisition in Salesforce history, a company known for being highly acquisitive.

A deal of this size usually faces a high level of regulatory scrutiny and can take six months or longer to close, but this one breezed through the process and closed in less than two months.

With Tableau and MuleSoft (a company it bought last year for $6.5 billion) in the fold, Salesforce has a much broader view of the enterprise than it could as a pure cloud company. It has access to data wherever it lives, whether on premises or in the cloud, and with Tableau, it enables customers to bring that data to life by visualizing it.

This was a prospect that excited Salesforce chairman Marc Benioff. “Tableau will make Salesforce Customer 360, including Salesforce’s analytics capabilities, stronger than ever, enabling our customers to accelerate innovation and make smarter decisions across every part of their business,” Benioff said in a statement.

As with any large acquisition involving two enormous organizations, combining them could prove challenging, and the real test of this deal, once the dust has settled, will be how smoothly that transition happens and how well the companies can work together and become a single entity under the Salesforce umbrella.

In theory, having Tableau gives Salesforce another broad path into larger and more expansive enterprise sales, but the success of the deal will really hinge on how well it folds Tableau into the Salesforce sales machine.

Jul
29
2019
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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 lucas@techcrunch.com]

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.

Jul
24
2019
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Alibaba to help Salesforce localize and sell in China

Salesforce, the 20-year-old leader in customer relationship management (CRM) tools, is making a foray into Asia by working with one of the country’s largest tech firms, Alibaba.

Alibaba will be the exclusive provider of Salesforce to enterprise customers in mainland China, Hong Kong, Macau and Taiwan, and Salesforce will become the exclusive enterprise CRM software suite sold by Alibaba, the companies announced on Thursday.

The Chinese internet has for years been dominated by consumer-facing services such as Tencent’s WeChat messenger and Alibaba’s Taobao marketplace, but enterprise software is starting to garner strong interest from businesses and investors. Workflow automation startup Laiye, for example, recently closed a $35 million funding round led by Cathay Innovation, a growth-stage fund that believes “enterprise software is about to grow rapidly” in China.

The partners have something to gain from each other. Alibaba does not have a Salesforce equivalent serving the raft of small-and-medium businesses selling through its e-commerce marketplaces or using its cloud computing services, so the alliance with the American cloud behemoth will fill that gap.

On the other hand, Salesforce will gain sales avenues in China through Alibaba, whose cloud infrastructure and data platform will help the American firm “offer localized solutions and better serve its multinational customers,” said Ken Shen, vice president of Alibaba Cloud Intelligence, in a statement.

“More and more of our multinational customers are asking us to support them wherever they do business around the world. That’s why today Salesforce announced a strategic partnership with Alibaba,” said Salesforce in a statement.

Overall, only about 10% of Salesforce revenues in the three months ended April 30 originated from Asia, compared to 20% from Europe and 70% from the Americas.

Besides gaining client acquisition channels, the tie-up also enables Salesforce to store its China-based data at Alibaba Cloud. China requires all overseas companies to work with a domestic firm in processing and storing data sourced from Chinese users.

“The partnership ensures that customers of Salesforce that have operations in the Greater China area will have exclusive access to a locally-hosted version of Salesforce from Alibaba Cloud, who understands local business, culture and regulations,” an Alibaba spokesperson told TechCrunch.

Cloud has been an important growth vertical at Alibaba and nabbing a heavyweight ally will only strengthen its foothold as China’s biggest cloud service provider. Salesforce made some headway in Asia last December when it set up a $100 million fund to invest in Japanese enterprise startups and the latest partnership with Alibaba will see the San Francisco-based firm actually go after customers in Asia.

Jul
18
2019
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Investor Jocelyn Goldfein to join us on AI panel at TechCrunch Sessions: Enterprise

Artificial intelligence is quickly becoming a foundational technology for enterprise software development and startups have begun addressing a variety of issues around using AI to make software and processes much more efficient.

To that end, we are delighted to announce that Jocelyn Goldfein, a Managing Director at Zetta Venture Partners will be joining on us a panel to discuss AI in the enterprise. It will take place at the TechCrunch Sessions: Enterprise show on September 5 at the Yerba Buena Center in San Francisco.

It’s not just startups that are involved in AI in the enterprise. Some of the biggest names in enterprise software including Salesforce Einstein, Adobe Sensei and IBM Watson have been addressing the need for AI to help solve the enterprise data glut.

Computers can process large amounts of information much more quickly than humans, and as enterprise companies generate increasing amounts of data, they need help understanding it all as the volume of information exceeds human capacity to sort through it.

Goldfein brings a deep engineering background to her investment work. She served as a VP of engineering at VMware and as an engineering director at Facebook, where she led the project that adopted machine learning for the News Feed ranker, launched major updates in photos and search, and helped spearhead Facebook’s pivot to mobile. Goldfein drove significant reforms in Facebook hiring practices and is a prominent evangelist for women in computer science. As an investor, she primarily is focused on startups using AI to take more efficient approaches to infrastructure, security, supply chains and worker productivity.

At TC Sessions: Enterprise, she’ll be joining Bindu Reddy from Reality Engines along with other panelists to discuss the growing role of AI in enterprise software with TechCrunch editors. You’ll learn why AI startups are attracting investor attention and how AI in general could fundamentally transform enterprise software.

Prior to joining Zetta, Goldfein had stints at Facebook and VMware, as well as startups Datify, MessageOne and Trilogy/pcOrder.

Early Bird tickets to see Joyce at TC Sessions: Enterprise are on sale for just $249 when you book here; but hurry, prices go up by $100 soon! Students, grab your discounted tickets for just $75 here.

Jul
02
2019
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Sam Lessin and Andrew Kortina on their voice assistant’s workplace pivot

Sam Lessin, a former product management executive at Facebook and old friend to Mark Zuckerberg, incorporated his latest startup under the name “Fin Exploration Company.”

Why? Well, because he wanted to explore. The company — co-founded alongside Andrew Kortina, best known for launching the successful payments app Venmo — was conceived as a consumer voice assistant in 2015 after the two entrepreneurs realized the impact 24/7 access to a virtual assistant would have on their digital to-do lists.

The thing is, developing an AI assistant capable of booking flights, arranging trips, teaching users how to play poker, identifying places to purchase specific items for a birthday party and answering wide-ranging zany questions like “can you look up a place where I can milk a goat?” requires a whole lot more human power than one might think. Capital-intensive and hard-to-scale, an app for “instantly offloading” chores wasn’t the best business. Neither Lessin nor Kortina will admit to failure, but Fin‘s excursion into B2B enterprise software eight months ago suggests the assistant technology wasn’t a billion-dollar idea.

Staying true to its name, the Fin Exploration Company is exploring again.

Jun
28
2019
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Enterprise SaaS revenue hits $100B run rate, led by Microsoft and Salesforce

In its most recent report, Synergy Research, a company that monitors cloud marketshare, found that enterprise SaaS revenue passed the $100 billion run rate this quarter. The market was led by Microsoft and Salesforce.

It shouldn’t be a surprise at this point that these two enterprise powerhouses come in at the top. Microsoft reported $10.1 billion in Productivity and Business Processes revenue, which includes Office 365, the Dynamics line and LinkedIn, the company it bought in 2016 for $26.2 billion. That $10.1 billion accounted for the top spot with 17 percent

Salesforce was next with around 12%. It announced $3.74 billion in revenue in its most recent earnings statement with Service Cloud alone accounting for $1.02 billion in revenue, crossing that billion-dollar mark for the first time.

Adobe came in third, good for around 10% market share, with $2.74 billion in revenue for its most recent report. Digital Media, which includes Creative Cloud and Document Cloud, accounted for the vast majority of the revenue with $1.8 billion. SAP and Oracle complete the top companies

SaaS Q119

A growing market

While that number may seem low, given we are 20 years into the development of the SaaS market, it is still a significant milestone, not to be dismissed lightly. As Synergy pointed out, while the market feels mature, if finds that SaaS revenue still accounts for just 20 percent of the overall enterprise software market. There’s still a long way to go, showing as with the infrastructure side of the market, things change much more slowly than we imagine, and the market is growing rapidly, as the impressive growth rates show.

“While SaaS growth rate isn’t as high as IaaS (Infrastructure as a Service) and PaaS (Platform as a Service), the SaaS market is substantially bigger and it will remain so until 2023. Synergy forecasts strong growth across all SaaS segments and all geographic regions,” the company wrote in its report.

Salesforce is the only one of the top five that was actually born in the cloud. Adobe, an early desktop software company, switched to cloud in 2013. Microsoft, of course, has been a desktop stalwart for many years before embracing the cloud over the last decade. SAP and Oracle are traditional enterprise software companies, born long before the cloud was even a concept, that began transitioning when the market began shifting.

Getting to a billion

Yet in spite of being late to the game, these numbers show that the market is still dominated by the old guard enterprise software companies and how difficult it is to achieve market dominance for companies born in the cloud. Salesforce emerged 20 years ago as an early cloud adherent, but of all of the enterprise SaaS companies that were started this century only ServiceNow and WorkDay show up in the Synergy list lumped in “the next 10.”

That’s not to say there aren’t SaaS companies making some serious money, just not quite as much as the top players to this point. Jason Lemkin, CEO and founder at SaaStr, a company that invests in and supports enterprise SaaS companies, says a lot of companies are close to that $1 billion goal than you might think, and he’s optimistic that we are going to see more.

“We will have at least 100 companies top $1 billion in ARR, probably many more. It is just math. Almost everyone IPO’ing [SaaS company] has 120-140% revenue retention. That will compound $100 million or $200 million to $1 billion. The only question is when,” he told TechCrunch.

SaaS revenue numbers by company

Chart courtesy of SaasStr

He adds that annualized numbers are very close behind ARR numbers and it won’t take long to catch up. Yet as we have seen with some of the companies on this list, it’s still not easy to get there.

It’s hard to develop a billion dollar SaaS company, and it takes time and patience, and perhaps some strategic acquisitions to get there, but the market trajectory continues to move upward. It will likely only grow stronger as more companies move to software in the cloud, and that bodes well for many of the players in this market, even those that didn’t show up on Synergy’s chart.

Jun
27
2019
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Fellow raises $6.5M to help make managers better at leading teams and people

Managing people is perhaps the most challenging thing most people will have to learn in the course of their professional lives – especially because there’s no one ‘right’ way to do it. But Ottawa-based startup Fellow is hoping to ease the learning curve for new managers, and improve and reinforce the habits of experienced ones with their new people management platform software.

Fellow has raised $6.5 million in seed funding, from investors including Inovia Capital, Felicis Ventures, Garage Capital and a number of angels. The funding announcement comes alongside the announcement of their first customers, including Shopify (disclosure: I worked at Shopify when Fellow was implemented and was an early tester of this product, which is why I can can actually speak to how it works for users).

The Fellow platform is essentially a way to help team leads interact with their reports, and vice versa. It’s a feedback tool that you can use to collect insight on your team from across the company; it includes meeting supplemental suggestions and templates for one-on-ones, and even provides helpful suggestions like recommending you have a one-on-one when you haven’t in a while; and it all lives in the cloud, with integrations for other key workplace software like Slack that help it integrate with your existing flow.

Fellow co-founder and CEO Aydin Mirzaee and his co-founding team have previous experience building companies: They founded Fluidware, a survey software company, in 2008 and then sold it to SurveyMonkey in 2014. In growing the team to over 100 people, Mirzaee says they realized where there were gaps, both in his leadership team’s knowledge and in available solutions on the market.

“Starting the last company, we were in our early 20s, and like the way that we used to learn different practices was by using software, like if you use the Salesforce, and you know nothing about sales, you’ll learn some things about sales,” Mirzaee told me in an interview. “If you don’t know about marketing, use Marketo, and you’ll learn some things about marketing. And you know, from our perspective, as soon as we started actually having some traction and customers and then hired some people, we just got thrown into it. So it was ‘Okay, now, I guess we’re managers.’ And then eventually we became managers of managers.”

Fellow Team Photo 2019

Mirzaee and his team then wondered why a tool like Salesforce or Marketo didn’t exist for management. “Why is it that when you get promoted to become a manager, there isn’t an equivalent tool to help you with that?” he said.

Concept in hand, Fellow set out to build its software, and what it came up with is a smartly designed, user-friendly platform that is accessible to anyone regardless of technical expertise or experience with management practice and training. I can attest to this first-hand, since I was a first-time manager using Fellow to lead a team during my time at Shopify – part of the beta testing process that helped develop the product into something that’s ready for broader release. I was not alone in my relative lack of management knowledge, Mirzaee said, and that’s part of why they saw a clear need for this product.

“The more we did research, the more we figured out that obviously, managers are really important,” he explained. “70% of customer engagements are due to managers, for instance. And when people leave companies, they tend to leave the manager, not the company. The more we dug into it the more it was clear that there truly was this management problem –  management crisis almost, and that nobody really had built a great tool for managers and their teams like.”

Fellow’s tool is flexible enough to work with specific management methodologies like setting SMART goals or OKRs for team members, and managers can use pre-set templates or build their own for things like setting meeting talking points, or gathering feedback from the colleagues of their reports.

Right now, Fellow is live with a number of clients including Shoify, Vidyard, Tulip, North and more, and it’s adding new clients who sign up on a case-by-case basis, but increasing the pace at which it onboard new customers. Mirzaee explained that it hopes to open sign ups entirely later this year.

Jun
18
2019
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Salesforce Customer Data Platform begins to take shape

Salesforce announced it is making progress toward releasing a Customer Data Platform (CDP) this week at Salesforce Connections in Chicago. While the company is talking in greater detail about the platform, they are calling Customer 360, it won’t be available for pilot customers until this Fall.

The idea behind the CDP isn’t all that different from good old-fashioned CRM, but instead of using a single source of data in a single database, Salesforce’s bread-and-butter product, it draws upon a variety of sources. Martin Khin, SVP for product strategy at Salesforce Marketing Cloud says that the company found that the average customer uses 15 significant sources of data to build a much more comprehensive picture of the customer.

In the 1990s, tracking customer data in a CRM was a fairly straightforward process. You had basic information like company name, address, phone number, main contacts and perhaps a listing of what each customer purchased, but as it has become increasingly crucial to gather enough data to fully understand the customer, it takes a richer set of data.

This whole area of creating a central database like a CDP is something that Salesforce, Adobe and others have begun to discuss in the last year. When you’re dealing with multiple sources of data, it becomes much more than a customer tracking problem. It becomes a serious data integration issue as the data is coming from a variety of disparate sources.

Khin says it comes down to pulling three main areas together. The first is identity management, in the sense that you have to be able to stitch together who this person is as he or she moves across the different data sources. It’s crucial to understand that this is the same individual in each channel and interaction, regardless of the system where the interaction occurs, and even if the customer started out without identifying themselves.

Once you have that identity foundation, which is the key to all of this, you can begin to build that 360 degree picture in the CDP, and with that, you can engage with the customer across multiple channels in a more intelligent way, based on actual detailed data about the person.

If the idea is to provide increasingly customized interactions, it requires as much data as you can gather to offer customized messages across each medium. The danger here is that you’re building a complete picture of each consumer in a central database, which in itself becomes a central point of failure. If a hacker were to breach that database, the prize would be a huge treasure trove of personal customer information.

Khin says Salesforce recognizes this of course, and cites Chairman Marc Benioff’s trust mantra. If that happened, it would be a huge breach of customer trust (and of their customers) and while it’s impossible to full protect any database, Salesforce considers security a huge priority.

The other issue is privacy around this information, especially in light of GDPR customer privacy rules in Europe, and other privacy initiatives coming down the pike in other countries. Khin says Salesforce customers have permission toggles they can turn on or off, depending on the region they are in.

For now, the Salesforce CDP is taking another step towards becoming an actual product. On the plus side, it could mean more meaningful, highly targeted marketing, but on the negative side, it’s a lot of personal information sitting in one place, and that’s something that every vendor building a CDP needs to take into consideration.

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