(Note: This is 100% pure speculation and is based on only publicly available insider information)
Upon initial rumors, I shared some brief thoughts on Twitter about a potential SFDC acquisition.
$SFDC speculation: ORCL is 1st to come to mind. IBM makes sense. SAP potential; not likely. MSFT a stretch. HP / Cisco interesting. #SFDC
— Brian Vellmure (@BrianVellmure) April 29, 2015
More $SFDC thoughts: Google could use #SFDC as anchor in Enterprise to counter what MSFT is doing. Google becomes real enterprise player.
— Brian Vellmure (@BrianVellmure) April 29, 2015
@kfarmer4444 I don't see that in their core (pun intended). Not really what Apple does.
— Brian Vellmure (@BrianVellmure) April 29, 2015
@Katykeim Plenty of room for $AAPL to penetrate the Enterprise with what they do best. This wouldn't be it. @Fortune
— Brian Vellmure (@BrianVellmure) April 29, 2015
@jonfortt Many paths to monetization. $CSCO has clearly stated big bet on cloud. $CRM could help. Agree lots of cash necessary @IanGertler
— Brian Vellmure (@BrianVellmure) April 29, 2015
@jonfortt @IanGertler AWS way out ahead & miles to go. Better for $AMZN to invest there. Both companies similarly profit averse though ![😉]()
— Brian Vellmure (@BrianVellmure) April 29, 2015
@cahidalgo I don't see $MSFT as the answer here. See my tweet stream for add'l thoughts on $CRM.
— Brian Vellmure (@BrianVellmure) April 29, 2015
Below are updated probabilities: I will update this post as information changes.
Oracle – 25%
Oracle still the favorite, and most straightforward case. Though Oracle is dominant from a CRM install base perspective, their current CRM offering has gaps. Some is old and mature. Other is new and underdeveloped. Benioff as CEO would be a win for Oracle. Yet another company to integrate for Oracle adds additional complexity to an already monumental challenge.
Microsoft – 20%
Microsoft has the cash. Nadella and Benioff appear chummy and are doing good things together. Reconciling tech, Go To Market, and legacy cultures would be a heft, and it’s unclear whether something like this would accelerate or slow the momentum that Microsoft is experiencing under Nadella’s leadership. SFDC would give MS rapid ownership of CRM in the Enterprise, where current Dynamics offering has played best in upper mid-market. They’d also be even stronger from a cloud platform perspective. This acquisition would be well outside MS traditional acquisition strategy of small and value based acquisitions, and a BIG bet for Nadella.
Nothing – 18%
Actually not a bad time to sell for SFDC. They’ve been on a heck of a run – are widely considered over valued and are fighting in a growing array of markets. One could argue that their best and highest growth days are likely behind them. Speculation of Benioff’s growing investments in philanthropy and a potential move into politics (even if completely unfounded) means that the inertia and motions of Mr. Market may already be rolling too fast to slow things down. Conversely, the potential buyers list is very small and there is no obvious answer. Even if intent is there, making a deal like this happen has a tidal wave of hurdles to actually get done.
IBM – 15%
IBM needs help. Their transition to the modern age, while in many ways is impressive, isn’t happening fast enough. Sometimes Huge challenge in bureaucracy, culture, future uncertainty. A SFDC acquisition doesn’t help IBM’s profitability challenges. It could actually exacerbate them.
Google – 9%
While this is not likely, Google has had Enterprise aspirations for quite some time and just haven’t been able to make them happen. This would help. A SFDC acquisition and bundling of Google for Business offerings with SFDC helps Google flank Microsofts momentum with O365, Windows 10, and Azure. of the less obvious players, this is my favorite.
SAP – 4%
Culturally, not a likely fit. In addition, SAP already has a complex array of CRM offerings, a large install base, and ongoing investments in CRM, Hana, and analytics. Not outside the realm of possibility, but not likely. The reconciliation of all of this appears to have too much risk.
Cisco – 4%
They’ve stated intention to move to the cloud. Lots of internal change currently and this would be an awfully big bet on the future for them.
Facebook – 3.75%
This would be a surprise, but not completely. FB has not been afraid to pony up and sees things 5 years ahead. Their acquisitions of Instagram, WhatsApp, and Oculus surprised many, and in subsequent months made a whole lot more sense in retrospect. FB has also been signaling an intent to reach enterprise wallets as most of the world has already adopted the platform. It’s well outside core capability, but could see some very interesting possibilities here.
HP – .75%
HP has been attempting to move more into enterprise software. This obviously would make them a player in a game they’re really not currently a player in.
Apple – .25%
I simply don’t see this happening. Apple could, but there are many, many other things that should garner their investment other than SFDC.
Someone we haven’t heard of – .25%
In the back of my mind, I see some sheikh, or well capitalized investment group from China wanting to make a large investment in the US economy. I am way out on a limb here (both in my knowledge and analysis), but since it’s crossed my mind, and this is 100% speculation anyway, I’ve included this.
Disclosure: SFDC is a client. Microsoft and IBM are past client(s).
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