Protocol | Enterprise

Qualtrics’ explosive IPO gave Bill McDermott his ‘told ya so’ moment

SAP's former CEO faced criticism over the price tag of an $8 billion deal back in 2018. It looks pretty savvy now.

Qualtrics’ explosive IPO gave Bill McDermott his ‘told ya so’ moment

Bill McDermott would like to set the record straight on Qualtrics.

Image: ServiceNow

It's quickly becoming the norm among software IPOs, but Qualtrics had a blockbuster public offering on Thursday.

Shares of the company, which provides customer sentiment monitoring, ended the day up 51%, giving it above a $24 billion valuation, higher than Wall Street initially expected. That's great news for CEO Ryan Smith and his over 3,000 employees. But it's also a win for SAP and vindication for former CEO Bill McDermott, who bought Qualtrics in 2018 as part of an acquisition spree for $8 billion. At the time, that price tag was criticized by analysts.

"Let's set the record straight," McDermott, who is now CEO of ServiceNow, told Protocol. "Not a single one of those large-scale transactions were anything less than successful. One such example is Qualtrics."

For Qualtrics, at least, McDermott's right. And SAP should get credit for helping the company grow as quickly as it did. Revenue in the first nine months of 2020 alone rose 30% year-over-year to $550 million, per its S-1 filing. While Smith requested the spinout after former SAP co-CEO Jennifer Morgan left in April, he and the company have acknowledged just how influential the German software firm was in helping reach the scale it's at now.

"Over the past two years we have increased our deal sizes, broadened and deepened our geographic footprint, and continued to build an exceptional team," Qualtrics wrote in the filing.

That's a reflection of the power that SAP still wields in C-suites despite its own struggles. And the two companies plan to continue to work together despite the IPO, namely because SAP still has a majority stake in the company.

But it remains to be seen how close the connection stays, especially since SAP has its own uphill battle to worry about. And there are already signs Qualtrics is pushing for growth without the SAP sales engine: It recently brought on former Microsoft executive Brad Anderson as the product and services president, as well as former Salesforce PR leader Gina Sheibley as chief communications officer, among other hires. Anderson, who helped lead Microsoft 365 deployment at enterprises, will be key to expanding sales among new and existing customers, while Sheibley led Salesforce's PR efforts for several key acquisitions, including Tableau and MuleSoft.

But whatever the future holds for Qualtrics, today McDermott finally gets his "told ya so" moment.

Protocol | Workplace

Instacart workers are on strike. How far can it get them?

Instacart activists want a nationwide strike to start today, but many workers are too afraid of the company and feel they can't afford a day off of work.

Gig workers protest in front of an Amazon facility in 2020.

Photo: Michael Nagle/Bloomberg via Getty Images

Starting today, an Instacart organizing group is asking the app's gig workers to go on a nationwide strike to demand better payment structures, benefits and other changes to the way the company treats its workers — but if past strikes are any indication, most Instacart users probably won't even notice.

The majority of Instacart workers on forums like Reddit and Facebook appear either unaware of the planned strike or don't plan to participate because they are skeptical of its power, afraid of retaliation from the company or are too reliant on what they do make from the app to be able to afford to take even one day off of the platform. "Not unless someone is going to pay my bills," "It will never work, you will never be able to get every shopper to organize" and "Last time there was a 'strike' Instacart took away our quality bonus pay," are just a few of the comments Instacart shoppers have left in response to news of the strike.

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Anna Kramer

Anna Kramer is a reporter at Protocol (Twitter: @ anna_c_kramer, email: akramer@protocol.com), where she writes about labor and workplace issues. Prior to joining the team, she covered tech and small business for the San Francisco Chronicle and privacy for Bloomberg Law. She is a recent graduate of Brown University, where she studied International Relations and Arabic and wrote her senior thesis about surveillance tools and technological development in the Middle East.

The way we work has fundamentally changed. COVID-19 upended business dealings and office work processes, putting into hyperdrive a move towards digital collaboration platforms that allow teams to streamline processes and communicate from anywhere. According to the International Data Corporation, the revenue for worldwide collaboration applications increased 32.9 percent from 2019 to 2020, reaching $22.6 billion; it's expected to become a $50.7 billion industry by 2025.

"While consumers and early adopter businesses had widely embraced collaborative applications prior to the pandemic, the market saw five years' worth of new users in the first six months of 2020," said Wayne Kurtzman, research director of social and collaboration at IDC. "This has cemented collaboration, at least to some extent, for every business, large and small."

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Kate Silver

Kate Silver is an award-winning reporter and editor with 15-plus years of journalism experience. Based in Chicago, she specializes in feature and business reporting. Kate's reporting has appeared in the Washington Post, The Chicago Tribune, The Atlantic's CityLab, Atlas Obscura, The Telegraph and many other outlets.

Protocol | China

WeChat promises to stop accessing users’ photo albums amid public outcry

A tech blogger claimed that popular Chinese apps snoop around users' photo libraries, provoking heightened public concerns over privacy.

A survey launched by Sina Tech shows 94% of the some 30,000 responding users said they are not comfortable with apps reading their photo libraries just to allow them to share images faster in chats.

Photo: S3studio via Getty Images

A Chinese tech blogger dropped a bombshell last Friday, claiming on Chinese media that he found that several popular Chinese apps, including the Tencent-owned chat apps WeChat and QQ, as well as the Alibaba-owned ecommerce app Taobao, frequently access iPhone users' photo albums in the background even when those apps are not in use.

The original Weibo post from the tech blogger, using the handle of @Hackl0us, provoked intense debates about user privacy on the Chinese internet and consequently prompted WeChat to announce that it would stop fetching users' photo album data in the background.

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Shen Lu

Shen Lu is a reporter with Protocol | China. Her writing has appeared in Foreign Policy, The New York Times and POLITICO, among other publications. She can be reached at shenlu@protocol.com.

Protocol | Enterprise

As businesses struggle with data, enterprise tech is cleaning up

Enterprise tech's vision of "big data" largely fell flat inside silos. But now, an army of providers think they've figured out the problems. And customers and investors are taking note.

Corporate data tends to settle in silos that makes it harder to understand the bigger picture. Enterprise tech vendors smell a lucrative opportunity.

Photo: Jim Witkowski/Unsplash

Data isn't the new oil; it's the new gold. And in any gold rush, the ones who make the most money in the long run are the tool makers and suppliers.

Enterprise tech vendors have long peddled a vision of corporate America centered around so-called "big data." But there was a big problem: Many of those projects failed to produce a return. An army of new providers think they've finally figured out the problem, and investors and customers are taking note.

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Joe Williams

Joe Williams is a senior reporter at Protocol covering enterprise software, including industry giants like Salesforce, Microsoft, IBM and Oracle. He previously covered emerging technology for Business Insider. Joe can be reached at JWilliams@Protocol.com. To share information confidentially, he can also be contacted on a non-work device via Signal (+1-309-265-6120) or JPW53189@protonmail.com.

Protocol | Policy

What Frances Haugen’s SEC complaint means for the rest of tech

Haugen argues Facebook misled investors by failing to disclose its platforms' harms. If the SEC bites, the rest of tech could be next.

The question is whether the SEC will find the contents of Haugen's complaint relevant to investors' interests.

Photo: Matt McClain-Pool/Getty Images

Whistleblowers like former Facebook staffer Frances Haugen have pretty limited options when it comes to actually seeking redress for the harms they've observed and documented. There's no federal privacy law in the U.S. to speak of, Section 230 protects platforms for online speech and companies like Facebook are under no obligation to share any information with lawmakers, or anyone else, about what's happening on their sites.

But there is one agency that not only governs all publicly-traded companies, including in tech, but also offers whistleblowers like Haugen the opportunity for a payout: the Securities and Exchange Commission.

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Issie Lapowsky

Issie Lapowsky ( @issielapowsky) is Protocol's chief correspondent, covering the intersection of technology, politics, and national affairs. She also oversees Protocol's fellowship program. Previously, she was a senior writer at Wired, where she covered the 2016 election and the Facebook beat in its aftermath. Prior to that, Issie worked as a staff writer for Inc. magazine, writing about small business and entrepreneurship. She has also worked as an on-air contributor for CBS News and taught a graduate-level course at New York University's Center for Publishing on how tech giants have affected publishing.

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