Salesforce.com was perhaps the most important business-to-business technology service of its generation, having led the way in popularising cloud computing applications, app stores and much else that we now take for granted in the everything-as-a-service world. Today it is having a vicarious importance too as a new generation of companies emerges with Salesforce DNA.
Salesforce veterans have started some well-funded businesses in recent years. Think of Zuora, a billing platform for subscription-based businesses; Okta is a leader in identity management; Hearsay Social is a suite for financial advisors. And then there are smaller offspring such as Tactile, SalesHood, AppMesh and Full Circle CRM.
But perhaps the most interesting of what you might call Benioff’s Babies (after Salesforce founder Marc) is a company called InsideSales which has raised over $140m in capital from investors including Salesforce’s VC arm, Salesforce Ventures. On this occasion, the company wasn’t founded by Salesforce alumni, however, but it has recruited three senior executives who were present and correct during that company’s bull-run to CRM eminence and changing the face of sales and marketing technology.
One of them is Jim Steele who ran Salesforce sales, another is David Rutnitsky who was VP of enterprise sales and the third is Lindsey Armstrong, a Brit (and, even better, a proud Geordie) who drove international expansion. I spoke to Armstrong to ask what had lured her to InsideSales, four years after she left Salesforce.
“It’s at that hot space of predictive and prescriptive analytics that sits somewhere between CRM and marketing,” she says. “If you look at Salesforce.com, Oracle or Microsoft, they’re repositories; they don’t tell you what to do. InsideSales makes your data live - makes it meaningful and actionable.”
InsideSales is no overnight success though. The company has been around for nearly 10 years and the slow-ish burn (relative to the rocket-curve growth of a few internet era stars) can be put down to the years spent gathering the data that is at the heart of the company’s appeal. CEO Dave Elkington is a philosophy graduate who worked as a quant at Deutsche Bank and then went back to college to study computer science. There he embarked on a project to understand what sellers can learn from historical interactions and that project led to InsideSales. The service uses the (rather clunky in name) ‘Neuralytics’ engine of billons of previous sales interactions to analyse what people did next in a wide variety of situations. Armed with these precedents, sales reps are thereby prompted to use their time and resources most effectively.
“From my own experience as a customer of CRM systems, I know they aggregate a lot of data and they are fantastic management tools but they deliver very little back to the frontline troops – the sales reps,” Armstrong says. “InsideSales slices and dices the data to help reps make increasingly smarter decisions on the frontline. It delivers advice: even what you might want to put in the email you’re writing.”
Armstrong says she was immediately convinced the concept had legs but she emphasises that what’s more important in growing a tech company is making that idea appealing to buyers and ensuring potential is fulfilled.
“The funding, media interest, the buzz… they’re table stakes now. It’s all about execution and execution trumps pretty much everything. If you have a great product and don’t execute, you will fail.”
Armstrong also has experience at Oracle, Veritas and Symantec to call on but that Salesforce nous will be hugely important. Salesforce not only funded InsideSales but is also a big partner (another partner is Microsoft which is also a customer, alongside Groupon, Marketo and about 2,000 others).
As at Salesforce, Armstrong wants to sell to marketing and sales leaders although she says CIOs will need to be onside too, given renewed concerns over security and data residency. Without supplying revenue numbers Armstrong says sales are doubling and there is the usual swelling of staff numbers: headcount is projected to reach close to 1,000 in 2015. Oh, and InsideSales is joining whatever the collective noun is for unicorns with a $1bn valuation.
It’s all very reminiscent of Salesforce itself of course and as with the San Francisco company, this Provo, Utah firm has huge ambitions and a desire to build a platform rather than just an application. Just as Salesforce’s message was ‘No Software’, the mantra here is ‘no cold calls’. And just as Salesforce has done, InsideSales will have to show that it can grow even as the numbers and stakes grow bigger. But the intriguing hires and healthy vital signs will make this company a closely watched proposition.
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