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Tag: C3.ai

  • Salesforce Plus Slack Equals a Battle Over the Cloud

    Salesforce Plus Slack Equals a Battle Over the Cloud

    Salesforce announced its much-anticipated acquisition of Slack earlier today, sparking nothing short of a battle over the cloud.

    Salesforce made headlines last week when news broke that it was looking to acquire Slack. Talks progressed rapidly, with the deal announced a few hours ago. In the statement announcing the deal, Stewart Butterfield, Slack’s CEO and Co-Founder, provided a clue about what’s at stake:

    Salesforce started the cloud revolution, and two decades later, we are still tapping into all the possibilities it offers to transform the way we work. The opportunity we see together is massive.

    Despite being responsible for starting the cloud revolution, Salesforce has come under increasing pressure from other companies, most notably Microsoft. The Redmond company has made no bones about its intention to unseat Salesforce as the dominant CRM company. Most recently, Microsoft partnered with C3.ai and Adobe to roll out an AI-based CRM.

    Similarly, Slack has been under increased pressure from Microsoft Teams. Teams doubled Slacks installed user base in November 2019 when it reached 20 million daily users. Its user base has exploded since then, reaching 115 million in October. Much of Teams’ growth has been the result of Microsoft’s bundling it with Office, a practice that prompted Slack to file an antitrust complaint with the EU.

    Butterfield’s comment about “the opportunity we see together is massive” is indicative of just how much both companies need this merger. Since its IPO, Slack has never turned a profit. To make matters worse, Slack has not experienced the same pandemic-fueled boon like Zoom and other cloud platforms. It’s experienced significant growth to be sure, but not to the same degree as competing companies.

    The combination of the two companies will help both fight Microsoft.

    “The core reason for this deal in our opinion is to keep pace with the cloud behemoth in Redmond,” Wedbush analyst Dan Ives said in a note to investors Tuesday, reports CNN. “Slack despite facing stiff competition from Microsoft has been a clearly successful solution set further penetrating enterprises and thus looks like the natural fit for Salesforce to beef up its collaboration and messaging footprint and keep pace with [Microsoft].”

    It remains to be seen if the two companies will be more effective together, but it’s a good start. The combination of the two platforms helps both provide a more complete offering to its customers.

  • Salesforce/Slack Deal Expected Tuesday

    Salesforce/Slack Deal Expected Tuesday

    Salesforce and Slack are expected to announce a sales agreement Tuesday, in what would be Salesforce’s biggest acquisition to date.

    The two companies made headlines Wednesday with news that Salesforce was looking to purchase the iconic corporate messaging app. At the time, talks were thought to still be in the preliminary stages, with no indication a deal was in sight. Within hours, however, outlets starting reporting the talks were in the advanced stages.

    Things have progressed quickly, as a new report from the Wall Street Journal says a deal could be announced as early as Tuesday after market close. CNBC’s David Faber reports the deal will be roughly half cash and half stock, although it may be slightly weighted toward the cash side.

    Similarly, while initial reports valued Slack at $17 billion, it appears Salesforce will be paying a significant premium. Faber said the deal is not expected to reach $30 billion, but may come close.

    Experts believe the acquisition will help Slack, as well as Salesforce, fend off Microsoft. Slack has been hurt by a number of factors, most significantly Microsoft’s bundling of Teams with Office. Microsoft’s tactics prompted Slack to file an antitrust claim with the EU, a claim Jim Cramer calls “strong.”

    At the same time, Microsoft continues to go after Salesforce’s core CRM market. Its most recent inroad was a partnership with C3.ai and Adobe to create AI-driven CRM.

    The combination of the two companies may ultimately help both compete with Microsoft more effectively.

  • Salesforce May Buy Slack

    Salesforce May Buy Slack

    Salesforce may be looking to make its largest acquisition to date, possibly snapping up Slack, the popular corporate message platform.

    Slack helped define the corporate messaging market and is used by organizations of all sizes. Recently, the company has faced increasing competition from Microsoft Teams, which has eclipsed Slack’s user base.

    Nonetheless, Slack is still wildly popular and continues to strike deals with major companies. In February, IBM announced it was deploying Slack to all 350,000 of its employees. Similarly, in June AWS announced it was deploying Slack to all of its employees. In return, Slack migrated its voice and video calling services to Amazon’s Chime platform.

    The AWS deal also spurred talk that Amazon might be interested in acquiring Slack. Despite Microsoft Teams’ larger market share, Slack is seen as the safe choice for companies that compete with Microsoft and don’t want to rely on a rival for their corporate communication. Given that AWS and Microsoft are the first and second-largest cloud providers, Slack seemed like a natural choice for AWS.

    It appears Salesforce may be interested in purchasing the message platform, however, according to a report by the Wall Street Journal. The talks appear to be preliminary, and therefore may ultimately come to nothing. Should the a deal be struck, however, it would be the largest in Salesforce history, since Slack is currently valued at $17 billion.

    Salesforce and Slack already integrate with each other. Given that both companies are locked in heated competition with Microsoft, joining forces may make sense. Salesforce, in particular, has been under increased pressure lately, with some analysts believing Microsoft’s open approach to data gives it a significant advantage over Salesforce. Microsoft has also partnered with C3.ai and Adobe to target Salesforce’s core CRM business.

    It remains to be seen if the talks will bear fruit, but it is also possible Saleforce’s interest could spark renewed interest from other parties, such as AWS. Larger companies content to partner with an independent Slack may not want to see it come under the control of a possible competitor. This, in turn, may motivate them to make a move of their own.

  • C3.ai Files For a Proposed IPO

    C3.ai Files For a Proposed IPO

    On the heels of news it had joined forced with Microsoft and Adobe to challenge Salesforce, C3.ai has announced its intention to file an IPO.

    C3.ai is an enterprise AI firm founded by CRM legend Tom Siebel. In late-October, C3.ai announced it had joined forces with Microsoft and Adobe to challenge Salesforce’s grip on the customer relationship management (CRM) market. The new product, C3 AI CRM, is built on Microsoft Dynamics and integrates with Adobe Experience Cloud, all the while using C3.ai to put AI first.

    The company is now filing for an IPO. The stock will trade under the ticker symbol “AI,” and will be listed on the New York Stock Exchange. The number of shares and price range have yet to be determined. Morgan Stanley, J.P. Morgan and BofA Securities will act as lead book-running managers.

    “Assessing the IT landscape at the beginning of the 21st century, it became apparent that a new set of technologies was destined to constitute another step function that would change everything about the information processing world, dramatically accelerating the growth of IT markets,” wrote Siebel in the filing. “This step function of technologies – substantially more impactful than anything we had seen before – included: elastic cloud computing, big data, the internet of things, and AI or predictive analytics. Today, at the confluence of these technology vectors we find the phenomenon of Enterprise AI and Digital Transformation, mandates that are rising to the top of every CEO’s agenda. The global IT market exceeds $2.3 trillion today.”

    Siebel was bullish on the company’s target market, as well as his company’s prospects within it.

    “We serve a large and rapidly growing market, estimated to be $174 billion in 2020, growing to $271 billion in 2024,” he continued. “Our goal is to establish a global market-leading position in this market as we did at Oracle and at Siebel Systems. The difference being that this market is an order of magnitude larger than either of those opportunities.”

  • Salesforce Beware: Microsoft, Adobe and C3.ai Reinvent CRM

    Salesforce Beware: Microsoft, Adobe and C3.ai Reinvent CRM

    Microsoft, Adobe and C3.ai have joined forces to use artificial intelligence (AI) to reinvent customer relationship management (CRM).

    The new product, C3 AI CRM, is powered by Microsoft Dynamics and fully integrates with Adobe Experience Cloud. The goal is to deliver “the first enterprise-class, AI-first customer relationship management solution is purpose-built for industries.”

    Salesforce, in particular, should be worried by this development. Microsoft has been trying for years to dethrone Salesforce as the CRM king, with little success. While Dynamics 365 has certainly carved out a corner of the market, Salesforce is still the undisputed leader.

    The combination of Dynamics’ foundation, C3.ai’s artificial intelligence and Adobe’s “AI-driven solutions for marketing, analytics, advertising, and commerce” may be just the winning combination Microsoft has been looking for.

    “This year has made clear that businesses fortified by digital technology are more resilient and more capable of transforming when faced with sweeping changes like those we are experiencing,” said Satya Nadella, CEO, Microsoft. “Together with C3.ai and Adobe, we are bringing to market a new class of industry-specific AI solutions, powered by Dynamics 365, to help organizations digitize their operations and unlock real-time insights across their business.”

    The companies made a point of highlighting how the digital transformation had changed the requirements for a CRM solution, with general-purpose software no longer meeting customers’ needs.

    “Microsoft, Adobe, and C3.ai are reinventing a market that Siebel Systems invented more than 25 years ago,” said Thomas M. Siebel, CEO of C3.ai. “The dynamics of the market and the mandates of digital transformation have dramatically changed CRM market requirements. A general-purpose CRM system of record is no longer sufficient. Customers today demand industry-specific, fully AI-enabled solutions that provide AI-enabled revenue forecasting, product forecasting, customer churn, next-best product, next-best offer, and predisposition to buy.”

    Microsoft’s open approach to data and integration have already been labeled a big advantage over Salesforce’s approach. Should this new partnership deliver on its promise, Salesforce may soon find itself scrambling to catch up.