After Keith Block’s reign as co-CEO, the news that Salesforce is acquiring Vlocity nevertheless marks a crucial step for the new CRM vendor, and one with serious implications for its ecosystem partners. Vlocity is one amongst the most significant and fastest-growing Salesforce-native ISVs, and being swallowed up by its own platform partner wasn’t its game plan when it was launched six years ago.
It is no surprise that Salesforce targeted this startup which has created strong 6 industry-specific CRMs on top of the Salesforce portfolios — communications, media, insurance financial services, health, energy and nonprofits.
But Vlocity’s founders had mapped a much more ambitious trajectory. They were inspired by the success of Veeva, the primary — then far only — Salesforce-native ISV to secure a stock exchange listing with its IPO in 2013, when it achieved a near $5 billion valuation (today, Veeva features a market cap of $22.3bn). Veeva’s early founders, joined by CEO David Schmaier et al. with a background in industry solutions at CRM pioneer Siebel, formed Vlocity in January 2014 with the goal of replicating Veeva’s success on a far grander scale.
A year ago the company was valued at a total of $1 billion and sold for $1.33 billion after raising $163 million. Which means it received 8.2X total invested capital which isn’t a nasty return.
In a recent blog article on the Vlocity website, founder and CEO Mr. David Schmaier put a confident spin on the deal. “Upon the close of the transaction, Vlocity — this excellent company that we, as a team, have created, built, and grown substantially into a transformational solution for 6 of the foremost important industries within the enterprise — will become a part of Salesforce,” he wrote in the blog.
Per usual, the deals are going to be predicated on regulatory approval and shut a while during Salesforce’s 2nd quarter in fiscal year 2021.
Bringing Vlocity into that blend further expands the impression and portfolio of Salesforce’s industry cloud offerings, benefits and adds new fuel to stay its continued growth on the right track. As a part of Salesforce, there’s immense potential to grow the Vlocity footprint than when it was achieving the success as a startup. Perhaps there’s also an addition element to the deal — at a time when Mr. Keith Block is stepping back, Mr. Marc Benioff (Founder and CEO) declared himself sating “especially excited that Mr. David Schmaier is joining into Salesforce family” on last night’s earnings call.