If you are interested in or working in M&A, looking at companies that master the art of M&A for best practices is always a good way to start.
Salesforce is committed to growing its business through acquisitions, and the company has a strong track record of successfully executing M&A deals. Salesforce’s most recent deal was the acquisition of the software firm Slack for $27.7B in July 2021.
Since 2013, Salesforce spent more than $55B on acquisitions. That’s why it was interesting to hear President and Chief Financial Officer Amy Weaver in her finance presentation talk about what they look for in an acquisition target at the Salesforce Investor Day 2022 on September 21st.
M&A is a complicated process that requires a lot of planning and analysis to execute successfully. Using the Salesforce M&A strategy framework worksheet can be a blueprint to develop your own M&A strategy on how to evaluate potential targets.
You can download the Salesforce M&A strategy framework worksheet as PDF, Google Slides, and PowerPoint template below.
Salesforce's impressive M&A track record over the last decade.
Salesforce had an impressive track record of innovation, constantly innovating and integrating new segments in the last twenty years into their Customer 360 product offering. Next to organic innovation salesforce invested in the last decade in best-of-class assets and integrated them into salesforce.
In the last decade, Salesforce acquired Slack (2021), Tableau (2019), MuleSoft (2018), Demandware (2016), and ExactTarget (2013) for in total of $ 55.2B (according to Salesforce Investor Presentation 2022, Slide 31).
All acquired companies brought key products and solutions into the so-called salesforce customer 360. They thrived under the new leadership of Salesforce, which speaks for a great integration mindset. An absolute highlight is the acquisition of Mulesoft. Acquired in May 2018 with 284M$ of revenue at acquisition, it today generates 1,7B$ revenues.
M&A has been a powerful part of their capital allocation strategy in growing the company to FY22 $26,5B revenue.
How is Salesforce looking at M&A? How does Salesforce evaluate M&A deals?
Salesforce defines 3 main pillars in their salesforce customer 360 M&A strategy framework:
1. Customer Success
Is the target the best-in-class asset to serve our customer's need
Is there a way to monetize the product effectively? How does the acquisition support salesforce financially?
Is there a clear timeline for value accretion?
In the future, salesforce wants to make use of its strong balance sheet, primarily financing acquisitions with cash and debt.
Acquisitions are one of the most common ways for technology companies to grow their market share and reach new segments. salesforce masters the art of M&A, acquiring and integrating more than 5 multi-billion companies in the last decade.
When done right, M&A can help most companies expand their product offerings, reach new customers, and strengthen their go-to-market strategy.
Still, M&A is a complicated process that requires a lot of planning and analysis to execute successfully. Using the salesforce M&A strategy framework worksheet can be a blueprint to develop your own M&A strategy.
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Salesforce M&A Strategy Framework Worksheet
Template in PDF, PowerPoint and Google Slides
Salesforce M&A Strategy Framework Worksheet PDF
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