Salesforce Acquisition Spree Sends Some Important Signals to the Market

Salesforce has been on an acquisition spree in the last years. The news that the SaaS giant is eyeing an acquisition of Twitter is the latest on a very active M&A season. Just in the last 6 months, Salsforce has spent over $4 billion in acquisitions in key areas for its next generation platform. This series of acquisitions are accelerating Salesforce’s entrance in new markets such as artificial intelligence(AI) and solidifying its position in other sectors such as ecommerce. Let’s take a look to Salesforce’s recent M&A path:

— Demandware: Salesforce reportedly paid $2.8 billion for ecommerce business Demandware. This acquisition will provide a bridge fo rthe Salesforce stack into the ecommerce market.

— Quip: Salesforce acquired information worker technology startup Quip for $750 million. Quip’s mobile word processing tools should be a great addition to Salesforce’s collaboration stack.

— BeyondCore: Enterprise analytics startup BeyondCored was acquired by Salesforce for a reported $110 million. That acquisition should expand Salesforce’s Wave Analytic capabilities.

— Prediction.IO: Salesforce acquired the open source machine learning platform Prediction.IO for an undisclosed amount. The technology is presumably being used in Salesforce’s newest flagship product: Einstein.

— YourSL: The Berlin-based digital consultancy was acquired by Salesforce to build its presence in Germany.

— MetaMind: Salesforce acquired MataMind for $32.8 million to expand it natural language processing capabilities. This should be another addition to the Einstein platform.

— SteelBrick: Salesforce bought SteelBrick for $360 million to offer quick quotes to customers.

— Coolan: Salesforce acquired data entry startup Coolan for an undisclosed amount.

— ImplicitInsights: Another Salesforce acquisition in the artificial intelligence space. The amount of the transaction was not disclosed.

What can we Learn from Salesforce Acquisitions?

Beyond the impressive numbers, there are a few lessons we can learn from Salesforce’s acquisition spree.

— Strong Focus on AI-ML: The large number of acquisitions in the artificial intelligence(AI) and machine learning(ML) space reaffirm Salesforce’s commitment to that market. We should expect to see some of the acquired IP as part of the Einstein platform.

— Moving Faster than Competitors: $4 billion in acquisition sin six months are another indication that Salesforce is just moving much more faster than the rest of the SaaS market. From that perspective, Salesforce should be consider in the same territory as enterprise software incumbents such as SAP, Oracle, Microsoft or IBM.

— Its M&A Season: The strong earnings posted by several enterprise software incumbents, the uncertainty in the public markets and the recent corrections in late state private financing are some o fhte factors conspiring to create a favorable climate for M&A and Salesforce is certainly capitalizing on it.

— AI Market consolidation i sharpening Faster than Expected: In six months, Salesforce acquired several companies in the AI and ML space. Other software giants such as Microsoft, Apple, Google and Twitter has also been active acquirers in the space. All these factors are a sign that the AI space is consolidating much faster than experts expected.

CEO of IntoTheBlock, Chief Scientist at Invector Labs, I write The Sequence Newsletter, Guest lecturer at Columbia University, Angel Investor, Author, Speaker.

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