September 23, 2015
Well, 170,000 people can’t be wrong – can they? Either way, San Francisco in September is a great time – even when it rains. DreamForce is a professional event and a branding statement like no other. There will be thousands of posts, blogs, tweets, and articles about the main show, the speakers, and the glitz, so I will leave that for others. Salesforce put on a great show and is clearly the center of a huge ecosystem. Here is the take on Dreamforce15 from one East coast tech investor.
- San Francisco needs to finish that subway and open up its roads. Between the construction of the subway, new building development, and trade-show madness, much of the business district was rendered pretty unbearable. Not as bad as Philly will be with the Pope, but no one expects to conduct an honest day of work when the pontiff is eating cheesesteaks.
- If I had to guess whose stock was rising and falling inside the Salesforce universe based on presence and buzz, I would say the following:
- Consulting firms are making a bundle on Salesforce and thus are willing to buy huge booths and staff them fully. Makes me wonder how seamless all of these disparate Salesforce parts are and whether the “no software” player has become one of the large messy platforms that it set out to unseat
- Smart players like InsideSales and Mulesoft didn’t have huge booths or big splashes, but they still managed to be in a lot of places and to touch many people. As an investor, I much prefer dollars being spent that way
- LinkedIn was practically silent and it was clear that the combination of the fact that they have shut off so many attendees’ APIs and that Salesforce is quickly distancing itself from and is soon to be competing with them was lost on no one
- I was surprised not to see Veeva, but I may just have missed them; maybe Dreamforce is too horizontal for their focused vertical strategy
- I saw many companies with booths or kiosks that were very early, some even close to pre-revenue early. I know because I have seen them in our offices and spoken to them on the phone. Maybe there is so much buzz about the conference that these companies feel a need to be here, which results in a very expensive case of FOMO that they likely can’t afford. For me, their stock dropped because they are demonstrating a poor spending discipline that will carry forward to post Series A actions
- I learned that I better get smart about “quote to cash” because Apttus and Steelbricks both were spending a king’s ransom on letting every one of the 170,000 attendees know that it was important. Maybe the fact that Salesforce Ventures invested a bundle in each of these competing businesses makes me scratch my head, but round tripping revenue from the corporate venture group back to titanium sponsorships seems a little dotcom like. To me, a solution that combines “configure-price-quote”, contract management, and revenue management and only requires six months of LiquidHub or Accenture to implement doesn’t seem like an innovation. Valuable for sure, but haven’t people been doing this for years?
- Not to pick on Apttus, but they really made themselves a target. Having raised $41M in February, 2015 followed by $108M just three weeks ago, they were intent on poking everyone at Dreamforce with their unicorn horn. They had a huge booth and a bunch of smaller booths, multiple store-fronts in and around the Moscone Center taken over for the duration for private events, and were giving away a Tesla. Hold on Unicorn, money may be your food, but it doesn’t grow on trees.
- I sat at the end of an aisle of eight-foot booths calculating that at $75k per booth times about 30 booths per aisle, that was $2.25 million of dollars before travel, hotels, food, other sponsorships, and give-aways. The led me to think that maybe giving away a Tesla is not such a bad idea. Imagine this – instead of one of our portfolio companies paying for a booth, it rents a suite at the W, which is right across the street. Then, several months before Dreamforce, the company reaches out to its highest priority targets and offers those prospective customers the right to one of only 50 raffle tickets to win a Tesla if they come and spend an hour with the start-up’s leadership in the suite. Fifty one-hour sessions with the key people from prospects would be much more productive than scanning the masses on the trade-show floor, while the costs would be similar. Or if the lottery sounds a little extreme, offer to pay each of their entry fees to Dreamforce if they spent an hour in the suite.
- Salesforce.com is relevant to so many enterprises and to so many other software players who need to operate within the salesforce ecosystem. It is the 4th largest software company – after Microsoft, Oracle, and SAP – and yet it feels so much more relevant, maybe because it is moving at such a higher speed than the three larger legacy businesses. It’s hard to know if this is the apex for Salesforce or just a check-in point on the up escalator, but if I had to guess, I would say that there is more room to rise, and increasingly our b2b software investments will need to understand where they fit in the broadening Salesforce ecosystem. Hopefully they can do this without spending a huge percentage of their annual marketing budget.