Salesforce

Overview

Salesforce’s standard biography — founded in 1999 by former Oracle executive Marc Benioff, a San Francisco company that helped establish the now-dominant model of delivering enterprise applications over the internet — is true but incomplete (Financial Times; Reuters). The fuller story is one of acquisition. By 2019 the Financial Times was already calling the company “highly acquisitive” after dozens of deals, and the three purchases that redefined it came in escalating succession: MuleSoft, a data-integration platform, for about $6.8 billion; Tableau, an analytics company, for $15.7 billion in stock; and Slack, a workplace-messaging app, for $27.7 billion — the largest deal in the company’s history (Financial Times; Reuters).

Each purchase filled a layer of the enterprise stack — integration, analytics, collaboration — and each was bigger than the last. In 2023, Wall Street delivered its verdict on the strategy: five activist investors piled in, the company cut 10% of its workforce, and Benioff spent the year proving the deals were worth what he had paid (TechCrunch).

What the organization is known for

Salesforce is the archetypal customer-relationship-management (CRM) company — TechCrunch calls it “the CRM giant” — and Reuters describes it as a “cloud-computing pioneer,” the firm that proved enterprise software could be sold as a cloud service rather than an on-premises product (TechCrunch; Reuters). It is equally known for growth by acquisition: the Financial Times noted in 2019 that Salesforce had already bought dozens of companies since its founding (Financial Times).

Products and services

The core product is CRM software delivered as a cloud service. Around it, Salesforce assembled adjacent layers through acquisition: data integration via MuleSoft; analytics via Tableau, whose software “turns raw data into visualisations” without requiring users to write code; and workplace collaboration via Slack, the real-time messaging app Salesforce bought to create “a unified platform for businesses to connect their employees, customers and partners” (Financial Times; Reuters).

Ownership, founders and leadership

Salesforce was founded in 1999 by Marc Benioff, a former Oracle executive, and the Financial Times describes it as a “cloud software group run by Marc Benioff” (Financial Times). Late 2022 brought abrupt leadership turnover: co-CEO Bret Taylor — widely seen as Benioff’s heir apparent — announced his departure at the end of November, and Slack CEO and co-founder Stewart Butterfield stepped down a week later (TechCrunch). Benioff continued as the company’s leader through the 2023 turbulence that followed (TechCrunch).

Funding and acquisitions

The acquisition sequence is the company’s growth story in miniature. MuleSoft, a data-integration platform, cost about $6.8 billion, per the Financial Times (Financial Times). In June 2019 Salesforce agreed to buy Tableau in an all-stock deal worth $15.7 billion in enterprise value — 1.103 Salesforce shares per Tableau share — expected to close by the end of October; Tableau was to continue operating independently from its Seattle headquarters under chief executive Adam Selipsky (Financial Times). The Financial Times framed the deal as a response to mounting competition from Oracle, Microsoft, and other large rivals (Financial Times).

Then, on December 1, 2020, came Slack: $27.7 billion, the biggest deal by the cloud-computing pioneer, paying Slack shareholders $26.79 in cash plus 0.0776 Salesforce shares per share — $45.5 per share, a 54% premium. Reuters described it as a bet on an extended run for remote working that sharpened Salesforce’s rivalry with Microsoft, whose Teams product competes directly with Slack (Reuters).

Regulation, licenses and compliance record

No regulator actions or license disputes were established from the sources read for this profile. The notable external pressure on the company has been financial rather than regulatory. In early 2023, five activist investors — Elliott Management, Starboard Value, ValueAct Capital, Inclusive Capital, and Third Point — pressed Salesforce for cost cuts and margin improvement (TechCrunch). Salesforce responded by adding three new board members, including ValueAct chief investment officer Mason Morfit, and on January 4, 2023 announced it would cut 10% of its workforce — about 7,000 people — attributing the move to overhiring during the pandemic (TechCrunch).

On March 1, the day of its earnings report, Elliott announced it would nominate its own board slate. Salesforce then reported quarterly revenue of $8.38 billion, up 14%; Elliott withdrew its nomination at the end of March, and the activist episode effectively ended (TechCrunch). By year-end the stock was up 96% year-to-date, the company had raised prices for the first time in seven years, and it announced 3,000 new hires (TechCrunch).

Timeline

• 1999 — Benioff, a former Oracle executive, founds Salesforce in San Francisco (Financial Times)
• 2018 — MuleSoft acquisition completed for about $6.8B (Financial Times)
• 2019 — Tableau acquired for $15.7B in an all-stock deal announced in June (Financial Times)
• 2020 — Slack acquired for $27.7B, announced December 1 (Reuters)
• 2022 — Bret Taylor’s departure announced in November; Stewart Butterfield steps down a week later (TechCrunch)
• 2023 — Activist siege: three new board members, 10% workforce cut on January 4 (TechCrunch)
• 2023 — Elliott withdraws its board slate in March after a strong quarter; year ends with the stock up 96% YTD (TechCrunch)

Competitors and partners

Named competitors established from the sources read are Oracle and Microsoft — the Financial Times cited mounting competition from both at the time of the Tableau deal, and Reuters framed the Slack acquisition as sharpening Salesforce’s rivalry with Microsoft’s Teams (Financial Times; Reuters). No partnership relationships were established from the sources read.

What this profile does not claim

• It does not assert IPO details; the widely reported 2004 IPO was not verified from a source read in full.
• Workforce-cut figures vary by outlet: this profile uses TechCrunch’s contemporaneous figure of 10% / ~7,000 people (January 4, 2023); some outlets reported ~8,000.
• The MuleSoft price is given as ~$6.8B per the Financial Times; other contemporary reporting said $6.5B.
• It names no co-founders beyond Benioff; other co-founder names were not verified from fully-read sources.
• It states only the December 2020 announcement of the Slack deal, not a completion date.
• It does not assert current revenue, headcount, or market-capitalization figures, which change continuously and were not the subject of this research.
• This profile covers Salesforce, Inc., the software company — not other uses of the name.