The past week has been a rollercoaster for the world of SaaS. Within 7 days, we’ve seen a ton of acquisitions, including the Salesforce + Slack which is one of the biggest acquisitions in the world of software, along with several fund-raising announcements and more.
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Salesforce makes its biggest acquisition ever; purchases Slack for $27.7billion
As was reported last week, Salesforce has acquired Slack. While it remains to be seen how it changes things for both the companies, many suggest that it’ll be a gamechanger for the CRM provider as it’ll have a way to track how several departments in enterprises communicate with each other.
Box’s Aaron Levie believes that this deal will define the future of work. He states that this deal will create a new “operating system” for how knowledge workers interact.
Many believe that Slack got acquired because it couldn’t compete with the juggernaut Microsoft Teams has become. As pointed out by Casey Newton, while Slack was the fastest growing enterprise software, Teams was growing much faster thanks to the top-down sales strategy.
GV’s MG Siegler on the other hand, offers a contrasting view that this deal wasn’t a failure. He believes that Slack has reached a successful outcome and is now on a level-playing field against Microsoft.
Over at The Information (Paywall), Slack’s CEO Stewart Butterfield says that Microsoft’s increasing dominance with the Teams wasn’t the reason for the deal. In fact, he mentions that Microsoft Teams doesn’t even scale to the entire enterprise as it’s limited to 5,000 users and 200 channels. He also rebuffs the fact that the company didn’t get acquired just to get the benefit from Salesforce’s go-to-market capabilities. He also took to Twitter to share his views (embedded below).
TechCrunch in its usual style, gets behind the story of how this acquisition took place. The publication talks to both Stewart Butterfield and Salesforce president and COO Bret Taylor as to how both the companies will benefit from each other.
More reads:
Slack: Salesforce’s Trillion-Dollar Hedge
Slack’s Butterfield expects to become a Salesforce President
Salesforce + Slack mashup signals the rise of Deep Collaboration
Acquisitions of the week
Customer success startup Gainsight acquired by Vista at $1.1billion price tag
Gainsight, the company that defined the term customer success, has been purchased by Vista Equity Partners. Its CEO Nick Mehta will continue to be with the company, and he also mentioned that they’re on track to meet their target of $100million ARR this year.
The social network is also making a play in the enterprise space as it has acquired CRM software Kustomer. What separates it from others is its omnichannel view of bringing all the conversations from different channels in one place.
Lightspeed acquires restaurant software company Upserve for $430M
POS provider Lightspeed has announced the acquisition of Upserve for $430million. It’s worth noting that it had acquired ShopKeep just last month for $440million. The deal will help Lightspeed to expand its presence in the restaurant industry.
ServiceNow is acquiring Element AI, the Canadian startup building AI services for enterprises
IT Service Management company ServiceNow has acquired Element AI, which is building AI-based IT services for enterprises. While the terms of the deal haven’t been disclosed, it’s reportedly worth $500million – making it ServiceNow’s biggest acquisition.
News of the week
GitLab is being valued at more than $6billion in secondary share sale
Continuous Integration software GitLab has been valued at $6billion as its letting its employees sell a portion of their equity. For reference, Microsoft had acquired its competitor GitHub for $7.5billion in 2018.
Snowflake shows 119 percent revenue growth in first earnings report as a public company
Snowflake, which went public in September this year, has announced its first quarterly results as a public company. It announced revenue of $159.6million. It also mentioned that it has 65customers that are contributing over $1million in product revenue.
Zoom’s astronomical growth rate appears to be moderating; shares fall
While Zoom has been the breakout hit of 2020, its growth seems to be stalling. In its latest earnings report, the company met analyst’s expectations with a revenue of $777.2million, though its rate of revenue growth is tapering off.
Stripe to offer banking services in deal with Goldman Sachs, Citigroup
Stripe continues to disrupt the payment ecosystem as it has introduced Treasury. It has partnered with banks like Goldman Sachs and Citigroup to offer checking accounts and other banking services to merchants. Shopify, its customer, will leverage this to launch Shopify Balance next year.
Related read: Stripe: platform of platforms
With Hyperforce, Salesforce lets you move your data to any public cloud
The Slack deal wasn’t the only reason Salesforce was in news last week. Along with announcing its quarterly results, the company also announced new features at Dreamforce, its annual conference. Hyperforce will allows its customers to move their data on public cloud infrastructure across the world.
Microsoft Teams gets an overhauled calling interface, CarPlay support, and more
Slack’s rival was in the news as it introduced a new calling interface. It also will make it easier for users to transfer calls between mobile and desktop in early 2021. Microsoft Teams is bringing CarPlay support so that people can use Siri to initiate or answer calls.
SaaS companies that got the funding this week
Bizzabo raises $138million for a platform that helps you build and run virtual conferences
There’s no doubt that virtual events are here to stay; and that explains the investor frenzy. Bizzabo has announced a $138million funding round led by Insight Partners. While the company is not disclosing its valuation, it has mentioned it has grown 400 percent since its last funding in April 2019.
Related read: Top virtual event software in 2020
GoSite snags $40million to help SMBs bring their businesses online
The ongoing crisis has accelerated the move to online, and GoSite seems to be utilising the same to its benefit. The company helps SMEs build websites, and has raised $40million Series B round.
ultimate.ai scores $20million for a supportive approach to customer service automation
Virtual customer service agent builder Ultimate.ai has received $20million Series A funding. Led by Omers Ventures, the money will be spent on sales and marketing.
Cloud-based browser testing platform LambdaTest raises $6million led by Sequoia’s Surge
LambdaTest, a browser testing platform, has nabbed $6million led by Sequoia’s Surge. The company has seen 8 to 10 percent growth monthly in terms of sign-ups, customers, revenue, and more since the pandemic.
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