Salesforce revealed on the 1st of August, 2016, that it has acquired Quip, the word processing app for teams. The deal was closed at a $582 million, and marks another milestone for its buying spree to expand its cloud computing apps and services. It has recently signed the agreement to acquire Demandware, the ecommerce software provider.
Quip, an upstart based in San Francisco which was initially built for mobile, and the rival to Microsoft’s Office 365 and Google Docs, announced on its blog that it will continue to operate its usual business, but under the software leader, Salesforce. It is interesting to note that Salesforce had previously invested in this startup through Salesforce Ventures, its venture fund.
What Would Salesforce Do With Quip?
This acquisition took place after Salesforce lost the bid to Microsoft in the acquisition of LinkedIn, which it really wanted. It may have been a coincidence, or it may not. But having Quip on its side, Salesforce has the opportunity to offer some business productivity tools (something that has been Microsoft territory for a long while).
Macquarie Research analyst Sarah Hindlian notes:
“Quip can enable sales teams/managers to collaborate on sales pitches, deals and more. We find the purchase of a vendor that fits nicely with business process tools – the market where Microsoft leads with Office – particularly interesting following the competitive bid between the two companies over LinkedIn, which we believe was motivated by the need for more sophisticated/machine learning empowered lead generation tools for both Salesforce and Dynamics CRM Online.”
→ Salesforce currently has access to huge amounts of data on customers that data companies store, since its main product, customer relationship management (CRM), helps businesses manage their prospective clients and contacts.
And now with Quip, Salesforce has access to data stored in documents and spreadsheets. This way, the company can work towards the next generation of cloud software. This vision is shared by the Quip co-founder and Facebook’s former CTO, Bret Taylor, who told Annie Gaus of San Francisco Business Times in an interview:
“Quip is a collaborative productivity suite intended to be the next generation of what Microsoft Office was in the previous generation.”
The acquisition of Quip was a surprise in the industry, since it was a growing platform and was even selective in taking any funding from VCs, and no one predicted that it would decide to sell up to Salesforce.
→ Salesforce can expand its customer base by providing this service and tempting customers away from Microsoft. But taking into consideration that the Quip team is working on board with the team of Salesforce, as Marc Benioff mentioned excitedly in a tweet,
Salesforce could be on board to bring to the cloud-computing world something even bigger.
→ This collaboration of the world’s number one CRM and the document management platform with a dash of Slack is certainly one to keep an eye out for. Both the companies have the opportunity to grow in potential.
Salesforce’s buyout of Quip has ensured a collaboration of content and communication, and both the companies can benefit greatly from each other. Salesforce can provide better and unique solutions while Quip will have access to a larger customer base than its existing one.
Quoting the blog post Quip posted about the reveal of the deal,
“Salesforce and Quip share the same philosophy about software: it should be in the cloud, built for the mobile era, and be inherently social. Salesforce pioneered the shift to enterprise cloud computing—and Quip has been working since 2012 to reimagine a productivity platform for teams that allows them to be more connected, more collaborative and get more work done.”
Contributed by: Santosh Prasad