Salesforce.com's Benioff And Infor's Phillips: A Fireside Chat
Two maverick executives discuss their recent partnership, the direction of enterprise software, and war stories from two decades in the software industry.
Marc Benioff and Charles Phillips have a lot in common. They're both former Oracle executives and they both now lead enterprise application companies that are poised to break $3 billion in annual revenue. Both executives have matured from being scrappy upstarts into blue chip veterans, yet they're both still challengers who aren't afraid to take on much bigger rivals.
Benioff and Phillips sat down together this week in Denver in front of about 100 CIOs and IT directors at an exclusive summit within the 4,000-attendee Inforum event, the ERP vendor's annual customer meeting. The topics at hand were Salesforce.com's recent investment in Infor and the release of Inforce Everywhere.
The details of the investment haven't been divulged, but an executive from one of Infor's venture capital backers told me it's modest--in the marketing-partnership league, not VC-level. As for Inforce Everywhere, it's a hybrid on-premises and cloud application that blends Infor's ION middleware with the Force.com platform to extract data from Infor ERP systems and other applications and present it within Salesforce.com.
In the intimate setting of a theater within the Denver Art Museum, the conversation took on a life of its own, ranging from the state of the industry to the impact of IT consumerization to the direction of the two executives' companies.
"Chuck and I have worked together for about 20 years, so we're lucky to be working together again," Benioff began.
"Yeah, it's a little easier not to be bashing heads this time," Phillips allowed.
Benioff, 47, and Phillips, 53, were competitors during the latter years of Phillips' eight years as co-president of Oracle. As Salesforce.com started stealing business from Oracle Siebel and Phillips' firm responded with Oracle CRM On Demand, the competition wasn't always friendly, but they appear to have put those clashes behind them.
Benioff launched into themes familiar to anyone who has attended a Salesforce.com Cloudforce or Dreamforce event in recent months. And it wasn't long before he pointed out the 38% revenue growth in Salesforce.com's most recent quarter and 37% growth for all of 2011.
"Even Chuck, when he was an analyst, would probably say that's pretty good," Benioff said, alluding to Phillips' pre-Oracle years following the software industry as a financial analyst at Morgan Stanley.
"We're getting pretty close to a $3 billion run rate this year, and that's exciting because in terms of enterprise software, few companies have managed to get there," Benioff said, noting that PeopleSoft, Siebel, Cognos, and Hyperion never surpassed $3 billion. "Only two companies ever got there: SAP and Oracle."
"And Infor," Phillips quickly added to a big laugh. "I just thought I'd throw that in there."
A bit surprised, Benioff asked: "What is your revenue this year?"
"2.8 billion," Phillips beamed.
"All right then, and Infor," said Benioff to more laughs.
Back on his Dreamforce/Cloudforce track, Benioff talked about a group of 20-something and 30-something CEOs he knows who are spinning out startups that are growing at triple-digit and quadruple-digit rates, "which makes enterprise growth rates look small and rather pathetic."
They're growing, he said, because they're embracing the four "defining principles" of the new era: cloud computing, mobile, social, and viral.
"They don't like the enterprise sales model that we pioneered, so they're using the viral or 'freemium' models to get into companies at many different levels," Benioff explained.
He pointed to Dropbox, which has more than 50 million users, and Square, which offers a smartphone-attached credit card reader that's being used by some 1 million small businesses.
"They've seen growth, revenue, and margins like we've never seen in enterprise software," Benioff said.
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