Underneath the Dreamforce pomp, Salesforce flexes its financial muscle

Last week, investors got a taste of Salesforce's post-Slack future. And despite looming risks, Wall Street appears to be buying it.

Marc Benioff in front of a sign for Dreamforce International Park

Dreamforce is a chance for customers to come together and celebrate everything Salesforce.

Photo: Salesforce

It's easy to forget that Dreamforce serves an important purpose for Salesforce beyond turning downtown San Francisco into a "Burning Man for people with jobs."

The annual conference is, of course, a chance for customers to come together and celebrate everything Salesforce in an environment that can feel like a cult gathering. In past years, attendees would stand in lines to get their own face imposed over Marc Benioff's latest book release cover or rush to take pictures with one of the multitude of dancing cartoon characters that serve as Salesforce mascots, including a literal "Customer 360" wheel.

This year was no different, despite a largely virtual audience. Attendees got the chance to see celebrities like Will Smith, watch a private Foo Fighters concert and listen to Benioff wax philosophically about the need for "trusted enterprises." All things considered, a pretty standard Dreamforce.

But behind the pomp and frill, Salesforce had a lot to brag about. While in the past the company put its product releases at center stage at Dreamforce, this year those announcements took a backseat as executives addressed key questions about the future of one of enterprise software's biggest names during a presentation for investors last week. And Wall Street appears to be buying the vision.

"We now view the stock as one of the lowest-risk, highest-reward trades in enterprise software," Wolfe Research's Alex Zukin wrote in a note to clients following the event.

Dreamforce 2021 was the company's first major in-person gathering after its blockbuster $27.7 billion purchase of Slack in 2020. As it looks to quickly absorb the company, Salesforce touted the success of other megamergers, including its $15.7 billion deal to buy Tableau in 2019. The data visualization software contributed $394 million in revenue in the first fiscal quarter of this year, a 38% rise.

And while the new capabilities introduced between Slack and Salesforce were lackluster and largely focused on simply bringing the instant-messaging platform into the Salesforce universe, executives like Benioff and COO Bret Taylor painted a strong vision ahead for supporting the new "digital HQ" — a surprising pivot for a company whose physical office eclipses the entire Bay Area skyline.

"Now, if I were starting a company, I would start it in Slack," Taylor told investors. "Most people's engagement is going to be over these new digital technologies."

Benioff struck a similar tone, telling the Wall Street audience that Salesforce's "digital headquarters are more important than our physical headquarters."

Salesforce upped its revenue forecast for next year, an announcement that helped drive the stock up to what one trader labeled a "ridiculous" amount. (Shares were down slightly in Monday trading.)

The company also largely ruled out any "significant" acquisitions, though Salesforce has been known to make similar promises in the past before announcing multibillion-dollar deals. Benioff and others repeatedly stressed that strategic pivot in discussions about "organic innovation," a departure from Salesforce's past, when it largely pursued new product offerings through pricey mergers.

But perhaps most noteworthy, Benioff declined to directly address increasingly rampant rumors that his departure from Salesforce — or at least, as CEO — is coming soon. Benioff recounted a conversation when director Sandy Robertson told him to stay forever: "That seems like a very long time. So, I don't know."

Showcasing the torchbearers

Despite the ambiguity over his future, it's clear Benioff was eager to showcase a revamped leadership team that increasingly looks like the anointed torchbearers for whenever he does decide to step aside.

Among them is, of course, Taylor, who appears increasingly likely to serve as the next CEO. But it was also a time to shine for newly-minted CFO and rising star Amy Weaver, along with CRO Gavin Patterson, CMO Sarah Franklin and Slack CEO Stewart Butterfield. The rise of those new leaders also pushed down the prominence of others: If you blinked, you probably missed new Tableau CEO Mark Nelson's presence at the conference.

"This conference is a manifestation of the last 18 months of work and the fundamental transformation of the entire organization. How we run it ... who is running it, how it is run," Benioff said. "Now we have probably the best management team we have ever had."

But while Salesforce may have presented a rosy image to Wall Street, that doesn't mean the company is without risks. The CRM market — Salesforce's core segment — is becoming increasingly competitive as Microsoft and upstarts like Freshworks and C3.ai all try to steal share from the industry leader.

And Salesforce's key areas of expansion moving forward pit them against very formidable opponents. The company, for example, plans to launch a customer data platform in late 2022, an already crowded space with providers like Adobe and Segment taking an early lead.

It's also slated to release an "all-digital contact center" product next year, again veering into a territory dominated by the likes of Genesys, Nice inContact and Five9. (Taylor also squashed speculation that Salesforce was a mystery bidder for Five9.)

Despite growing competition, Salesforce appears to be firing on all cylinders. And as Benioff enters what could become the twilight of his tenure at the helm of the company he co-founded in 1999, you can bet he's going to try to end it on a bang.


The tools that make you pay for not getting stuff done

Some tools let you put your money on the line for productivity. Should you bite?

Commitment contracts are popular in a niche corner of the internet, and the tools have built up loyal followings of people who find the extra motivation effective.

Photoillustration: Anna Shvets/Pexels; Protocol

Danny Reeves, CEO and co-founder of Beeminder, is used to defending his product.

“When people first hear about it, they’re kind of appalled,” Reeves said. “Making money off of people’s failure is how they view it.”

Keep Reading Show less
Lizzy Lawrence

Lizzy Lawrence ( @LizzyLaw_) is a reporter at Protocol, covering tools and productivity in the workplace. She's a recent graduate of the University of Michigan, where she studied sociology and international studies. She served as editor in chief of The Michigan Daily, her school's independent newspaper. She's based in D.C., and can be reached at llawrence@protocol.com.

Sponsored Content

Foursquare data story: leveraging location data for site selection

We take a closer look at points of interest and foot traffic patterns to demonstrate how location data can be leveraged to inform better site selecti­on strategies.

Imagine: You’re the leader of a real estate team at a restaurant brand looking to open a new location in Manhattan. You have two options you’re evaluating: one site in SoHo, and another site in the Flatiron neighborhood. Which do you choose?

Keep Reading Show less

Elon Musk has bots on his mind.

Photo: Christian Marquardt/Getty Images

Elon Musk says he needs proof that less than 5% of Twitter's users are bots — or the deal isn't going ahead.

Keep Reading Show less
Jamie Condliffe

Jamie Condliffe ( @jme_c) is the executive editor at Protocol, based in London. Prior to joining Protocol in 2019, he worked on the business desk at The New York Times, where he edited the DealBook newsletter and wrote Bits, the weekly tech newsletter. He has previously worked at MIT Technology Review, Gizmodo, and New Scientist, and has held lectureships at the University of Oxford and Imperial College London. He also holds a doctorate in engineering from the University of Oxford.


Nobody will help Big Tech prevent online terrorism but itself

There’s no will in Congress or the C-suites of social media giants for a new approach, but smaller platforms would have room to step up — if they decided to.

Timothy Kujawski of Buffalo lights candles at a makeshift memorial as people gather at the scene of a mass shooting at Tops Friendly Market at Jefferson Avenue and Riley Street on Sunday, May 15, 2022 in Buffalo, NY. The fatal shooting of 10 people at a grocery store in a historically Black neighborhood of Buffalo by a young white gunman is being investigated as a hate crime and an act of racially motivated violent extremism, according to federal officials.

Photo: Kent Nishimura / Los Angeles Times via Getty Images

The shooting in Buffalo, New York, that killed 10 people over the weekend has put the spotlight back on social media companies. Some of the attack was livestreamed, beginning on Amazon-owned Twitch, and the alleged shooter appears to have written about how his racist motivations arose from misinformation on smaller or fringe sites including 4chan.

In response, policymakers are directing their anger at tech platforms, with New York Governor Kathy Hochul calling for the companies to be “more vigilant in monitoring” and for “a legal responsibility to ensure that such hate cannot populate these sites.”

Keep Reading Show less
Ben Brody

Ben Brody (@ BenBrodyDC) is a senior reporter at Protocol focusing on how Congress, courts and agencies affect the online world we live in. He formerly covered tech policy and lobbying (including antitrust, Section 230 and privacy) at Bloomberg News, where he previously reported on the influence industry, government ethics and the 2016 presidential election. Before that, Ben covered business news at CNNMoney and AdAge, and all manner of stories in and around New York. He still loves appearing on the New York news radio he grew up with.

We're answering all your questions about the crypto crash.

Photo: Chris Liverani/Unsplash

People started talking about another crypto winter in January, when falling prices had wiped out $1 trillion in value from November’s peak. Prices rallied back in March, restoring some of the losses. Then crypto fell hard again, with bitcoin down more than 60% from its all-time high and other cryptocurrencies harder hit. The market’s message was clear: Crypto winter was no longer coming. It’s here.

If you’ve got questions about the crypto crash, the Protocol Fintech team has answers.

Keep Reading Show less
Latest Stories