Cloud Earnings Highlights: Salesforce (CRM), Workday (WDAY), Veeva Systems (VEEV)

Tom Paine

Salesforce slightly beat expectations for Q1 of its 2021 fiscal year, reporting net income of 70 cents per share on revenue of $4.87 billion, up 30% from the prior year. The company dropped its revenue forecast for the full year by $1 billion to $20 billion.

Salesforce expects earnings between $2.93 and $2.95 per share, down from previous expectations 0f $3.10 per share.

Salesforce’s deal with AT&T (Wireless) is one of the ‘largest transactions we’ve ever done,’ says Salesforce CEO Marc Benioff.

Workday showed profits of 44 cents per share (excluding certain items) on revenue of $1.02 billion, up 23% from a year ago. It also lowered its forecast for the year.

Workday will offer a new integration with Salesforce’s Work.com to help joint customers plan for the safe reopening of their workplaces in the wake of the COVID-19 pandemic.

I find it intruiging to see the two companies working together, and wonder if that collaboration might lead to bigger thing in the future.

Pleasanton, CA-based Veeva Systems, Inc., with east coast offices in Radnor, had a tremendous start to its fiscal year 2021. Revenue was up 38% from the prior year to $337.1M, while net income was $86.6 million, up 18%. Veeva benefited from customer activity created by Covid-19, the general pace of change in the industry, and the continued fleshing out of its product line.

Matt Wallach, who retired from his role as president of Veeva Systems as of June 2019, returned as a non-managerial board member in January as planned. Wallach is also involved in the startup community, such as serving on the board of HealthVerity.

Highlights – Memorial Day Weekend

Tom Paine

While many people were taking advantage of the limited freedoms allowed by the State, a few notable things in the tech world were happening:

Rather than letting Covid-19 slow it down, Microsoft appears to be speeding up, or perhaps its just doing a better job at publicity. The biggest news of the week from Microsoft was the introduction of Microsoft Industry Clouds, beginning with Healthcare.

The standard for industry clouds is Veeva Systems for life sciences .Everything in Veeva’s cloud is highly integrated to work together. I’m not sure that Microsoft has achieved that yet, but its put alot of tools out there, mostly focused on communications and scheduling. But that’s a good start, and the company should be patient with a slow build.

Veeva is worth just under $30 billion today. Pharma has unique regulatory conditions that has probably made that possible. Its not clear that it can be replicated.

Other industry clouds are expected to be forthcoming from Microsoft.

Also, Microsoft has been busy on the acquisition front. A Light Reading podcast discusses how it might utilize two recent telecom-related acquisitions: Affirmed Networks and Metaswitch Networks.

In another telecom situation, Microsoft is reported to be close to making a $2 billion investment for a ~2% stake in Jio Platform, India’s largest wireless network.

Alibaba’s Cloud business saw revenue grow 62% to a $5.6B run rate in Q1 2020, but its still only a sixth the size of AWS. Given that the breakdown in economic and technological ties between China and the US is expected to worsen, China is likely to increasingly see Alibaba Cloud as a vital national. strategic asset. It doesn’t want Chinese business to depend on the US clouds.

Also, today another Chinese internet power, Tencent, announced plans to invest US$70 billion in new digital infrastructure. The five-year plan will have Tencent focus on fields that include cloud computing, artificial intelligence, blockchain technology and the Internet of Things. Other investments will go to infrastructure such as advanced servers, supercomputers, data centers and 5G mobile networks.

CNBC weighs in with a piece about how “Digital health stocks are surging because ‘suddenly now we’re in the future’ “, thanks to Covid -19. There’s a whole bunch of digital health startups in Philly that aren’t IPO-ready yet. One that was ready is Moorestown-based Tabula Rasa, which went public in 2016 and is now worth $1.35 billion.

Other items worthy of mention:

As this Twitter ad makes clear, GSK is teaming up with a sometime-competitor for a Covud-19 vaccine effort:

It will be interesting to see how $16 billion will be spent to expand broadband to places in the US that are currently not served. Expect a big fight between both political parties and telecom companies.

Comcast decides what the next move in its network architecture will look like, while some other cable operators decide differently.

Philly EnterpriseTech PeopleNews 5/23

PRINCETON-BASED OPENLEGACY GETS A $20 MILLION STRATEGIC INVESTMENT

Hans Otharsson of OpenLegacy
Hans Otharsson, OpenLegacy | Courtesy OpenLegacy

OPENLEGACY GETS A $20 MILLION STRATEGIC INVESTMENT

Innovative Technology Gives Legacy System Users a Fast Path to API Creation

Esther Surden

In February, before the bottom dropped out of the market and COVID-19 became part of our everyday lives, Princeton-based OpenLegacy, a company with a unique solution that allows large enterprises to leverage their older mainframes for services both on premises and on the cloud, received a $20 million strategic investment from Tokyo-based SBI Holdings.

This is in addition to a funding round in 2018 that brought in $30 million. The company used the $30 million to refine its tools and to expand in the United States and in the rest of North America. The additional funding will be used to expand in Asia.

According to information supplied by the company, OpenLegacy’s solution reduces the time, cost and risk normally associated with digital transformation by connecting directly to legacy systems, automatically generating microservice-based APIs, and deploying on a customer’s premises or in the cloud. Additionally, OpenLegacy reduces the total cost of ownership by bypassing layers of middleware, and delivers digital services without changing the back-end legacy system.

NJTechWeekly.com spoke to Hans Otharsson, chief customer success officer at OpenLegacy, who has been with the company for much of the time since it was founded, in 2012.

The company is in the Princeton area to be close to customers, Otharsson told us. New Jersey, as a large technology infrastructure space, is a “hotbed for the kinds of systems” that OpenLegacy is dealing with, he added. A lot of companies located in New Jersey and in neighboring states rely on legacy systems, including insurance companies, large financial institutions and pharmaceutical firms, as well as state and local government agencies.

Mainframes do a fantastic job in what they are supposed to do. “They are very, very fast and very secure,” he said. “And they are the heart–lung machine of a lot of organizations because of those factors. But mainframes don’t necessarily play well with others.”

To Otharsson, “others” includes the channel market. In all industries these days, there is a lot of integration between companies, within supply chain management and between vendors and suppliers or compliancy organizations. All that integration involves one system talking to another system, updating a third system and so on, he explained.   

“Fundamentally, what they’ve done is just built more layers around their technology… around their system of record.”

Hans Otharsson, OpenLegacy

Over the past 20 or 30 years, a lot of large organizations claimed to have solved the problem by installing a message broker, or an enterprise service bus (ESB), or service-oriented architecture (SOA) on top of the legacy systems, he continued. “Fundamentally, what they’ve done is just built more layers around their technology… around their system of record. And then what they’ve also done is that, because that legacy system of record was just so complicated, so difficult, the IT people are now unhappy as they’ve been kept as caretakers of their legacy technology, and can no longer be innovators.”

He said that “at Facebook or Google, they make 5,000 changes to their production environment a day. It’s all about moving quickly. Failing small, failing fast, right? But they keep moving. You talk that way to a legacy shop, and they are going to start crying.”

Otharsson noted that a simple application, such as taking a photo of a check and depositing it into an account, can take as much as 18 months to execute when companies use traditional methods. OpenLegacy is about eliminating all that complexity, “making it simple from an integration perspective, via a microservice. It is really an API saying, ‘Give me this, I’m going to give you this back.’ And if I can cut through all those layers, I can save all that time [for] that innovation manager at that bank who wants to take pictures of checks in five days,” not 18 months. “That in itself is a fundamental change in how that bank thinks and how it works.”

Otharsson explained to us how the company’s tool works. Basically, it automates this generation of integration. “We tell a customer, ‘You want to expose deposits? Send us that COBOL program, that assembler program, those copybooks.’ We put it through our tool to be able to understand how that application thinks and talks. Once we understand, we can generate the API in the microservice,” he said.

“I have customers now that are generating five to 10 APIs per week, when it used to take them six months for one.”

Open Legacy has six employees in New Jersey and a worldwide employee count of more than 100 employees. About half of the management team is in New Jersey. Additionally, Romi Stein, the company’s CEO and cofounder and Roi Mor, the company’s CTO and cofounder, are based in Israel.

About The Author

Esther Surden

Esther is the Founder and Editor in Chief of NJ Tech Weekly. This article is republished by Philly EnterpriseTech with her permission.

Esther Surden@njtechwkly·

COPYRIGHT © 2019 NJ TECH WEEKLY ALL RIGHTS RESERVED

Philly EnterpriseTech Highlights 5/17 to 5/19

Philly EnterpriseTech Highlights May 14 to May 15 – PhillyEnterpriseTech http://bit.ly/2ycSrkQ

Allentown-based Shift4 Payments files for IPO

Tom Paine

Shift4 Payments, an Allentown-based provider of POS systems for the hospitality industry (hotels & restaurants) that’s been around since the early 90’s under various names, filed for an IPO on Friday. The S-1 said Shift4 would make its offering for $100 million, though the website Renaissance Capital indicates this may just be a placeholder. In any event, its hard to tell how the market will rebound after Covid-19.

Shift4 Payments filed confidentially with the SEC back in December, before the pandemic reached the US according to reports..

For Q1 2020, Shift4 total revenue was up 29% to $199.4 million, and the company narrowed its net loss to $5.2 million from $13.5 million. The first quarter was impacted somewhat by Cobid-19 in March.

I don’t understand this market, and its segmentation, that well. The leaders appear to be MICROS (Oracle), Microsoft and NCR. I’ve also followed the journey of Heartland Payment Systems (acquired by Global Payments in 2016) and Sicom (acquired by Global Payments in 2019). Both of these companies were backed by LLR Partners at similar stages of growth.. JetPay, another Philadelphia-area company, was acquired by NCR. The obvious theme is consolidation, and most signs point towards Atlanta, where NCR and Global Payments are based.

“There’s just a tremendous amount of fragmentation that has thwarted innovation in hotel IT,” said Mike Webster, senior vice president and general manager, Oracle Retail and Oracle Hospitality, in 2017. “All these hotels are dabbling with these point solutions: I call it “shiny object syndrome,” or SOS — and I use SOS as an intentional pun. Because you know you’re in trouble if you think that’s what’s going to save your brand.”

In this uncertain environment, Shift4 may just be taking the car outside for a spin to. see who notices. Or it may IPO. We’ll see.

The company plans to list its Class A common shares on the New York Stock Exchange under the symbol “FOUR”.

Philly EnterpriseTech Highlights May 14 to May 15

Elemica Announces Partnership with CheMondis, the leading B2B Online Marketplace for Chemicals in Europe Partnership enables the chemical industry in Europe to conduct business completely digitallyElemica Announces Partnership with CheMondis, the leading B2B Online Marketplace for Chemicals in Europe Partnership enables the chemical industry in Europe to conduct business completely digitally

Elemica Announces Partnership with CheMondis, the leading B2B Online Marketplace for Chemicals in Europe
Partnership enables the chemical industry in Europe to conduct business completely digitally

Wayne, PA – May 5, 2020 – Elemica, the leading cloud-based Digital Supply Network for global manufacturing industries, announces a strategic partnership with CheMondis, the leading B2B Online Marketplace for chemicals in Europe. The partnership enables clients of CheMondis to have a complete digital “amazon-like” order management experience.

“Elemica is extremely happy joining forces with CheMondis to enable CheMondis’ clients to connect seamlessly to any buyer or supplier of the CheMondis network as the data management order broker,” says Ingo Schildt, Elemica Senior Manager Supply Chain Solutions. “The partnership provides CheMondis network members an efficient ‘amazon-like’ service experience through automated order management integration to suppliers, through direct ERP-system integration or, through simply a transactional email infrastructure.”
“CheMondis is very glad to take the partnership with Elemica to the next level as we are strengthening our position as the leading B2B marketplace for chemicals in Europe,” according to Cornelia Birnbrich, Head of Commercial at CheMondis. “We are excited to partner up with Elemica to extend our marketplace ecosystem by bundling the data management and order brokering services of Elemica and integrating them into the marketplace and for the benefit of our customers.” 
The partnership is a validation of the recent developments on how the industry is moving towards digital sales and procurement channels to generate new sales and while improving operational efficiency.  

About Elemica
Elemica is the leading Digital Supply Network for global manufacturing industries. Elemica accelerates digital transformation by connecting, automating, anticipating, and then transforming inter-business supply chain processes for the products they buy, sell, move, and comply. Launched in 2000, customers process over $600B in commerce annually on the network. For more information, visit www.elemica.com.

About CheMondis
CheMondis is the trusted B2B chemical Marketplace made in Germany. CheMondis was founded in mid-2018 and has since then become the leading B2B marketplace for chemicals in Europe. It combines chemical expertise with outstanding technological know-how. This combination makes us unique. At CheMondis, we’re on a mission to build an innovative B2B marketplace for the chemical industry. For more information visit www.chemondis.com

How Covid-19 may accelerate technological change

I posted this in late March; Wonder how well its held up

Most historians study wars not for the battles, but for the transformative changes in society that are initiated during them. The same is true for major pandemics such as that caused by Covid-19..There is an urgency, a necessity, to try new solutions to solve problems. Often, these solutions involve adoption of new technologies.

These are some of the technologies and systemic changes that could see continued expanded use, if successful, after Covid-19 decelerates:

Telehealth or Telemedicune: Some medical situations can be handled or assisted in this way and some simply can’t. For those that can, Telehealth is being utilized much more. Last week, The Centers for Medicare and Medicaid Services loosened requirements that would make it easier for hospitals to bolster care through telehealth.

Online gambling : The nascent industry may see its growth curve accelerate in states where it is available. New Jersey and Pennsylvania are two of those with a head start since the landmark Supreme Court ruling.

Online.Education Though there have been some disappointments in the past here, such as the tendency of students not to complete courses, adjustments to systems and approaches have been made. Zoom (which I consider overvalued) or its competitors are often factors. Philly startup Yellowdig is extending this offer:

Supply Chain

Covid-19 is an acid test for many supply chain methodologies and systems, and will reveal many faults.

Expect to see some systematic rethinking by the whole industry, which is already being reshaped by new technology.

Home delivery

Volume is likely to mushroom in the short term, and it will be a challenge for competitors to keep up with demand. goPuff’s approach, relying on its own distributed inventory stores, may prove out well. And certainly many new users will be introduced to these services during the current crisis.

Medical Diagnostics

Changes in fast remote medical testing that are evolving now may become the norm

Also, look for lasting changes to streanline and accelerate Clinical trials.

Broadband Speeds.

Cable & wireless providers are loosening or eliminating caps. When normalcy returns, will limits be fully restored? Signs of overload are appearing. Major streaming services are voluntarily slowing down in some regions.

Work from Home (telecommuiting): Remote security is a major concern. Video conferencing services are competing hard here.

GPS tracking

Israel and other nations are considering tracking Covid-19 test subjects using GPS systems, both for tracking individuals and collectively.

Delivery by robot or drone: Fits nicely with the goal of minimizing face-to-face encounters. Drones face a challenge in meeting FAA and national security concerns. Still mostly testing, but could see some things happening here.

MissionOG portfolio company DivvyCloud acquired by Rapid7 for $145 million – PhillyEnterpriseTech

information supplied by MissionOG

MissionOG is pleased to announce the acquisition of portfolio company DivvyCloud by Rapid7 (ticker: RPD) for $145 million. The acquisition represents a great outcome for the DivvyCloud team, its investors, and the acquirer. 

DivvyCloud broadens Rapid7’s product offerings to include infrastructure security and compliance. As Rapid7 CEO Corey Thomas stated, “We have been very impressed with the DivvyCloud team and its technology for some time. As the rate of cloud adoption continues to rise, the DivvyCloud platform will be an important part of our offering, giving customers a much deeper, comprehensive view into their cloud security posture.”

Founded by Brian Johnson and Chris DeRamus and headquartered in Arlington, Virginia, DivvyCloud provides automated policy enforcement for multi-cloud and container environments to help enterprises manage infrastructure cost, compliance, and security.  

MissionOG first invested in DivvyCloud in October 2017 and participated in a subsequent growth round in April 2019. DivvyCloud’s business was well matched to a core investment theme that we have pursued – enterprises will continue to migrate workloads in mass to the cloud, creating great demand for tools to effectively innovate and manage their cloud infrastructure.  

The exit from DivvyCloud marks the firm’s second successful investment outcome within the cloud infrastructure space with the prior being the acquisition of Cloudamize by Blackstone. We have been thrilled to watch DivvyCloud build a leadership position in a fast-growing market and remain excited about their future, now with Rapid7.

To learn more about the transaction, please see additional coverage on Venture Beat and ZDNet.

Recent Portfolio NewsTethr research on COVID-19 highlighted in recent Harvard Business Review articleDrew Edwards, CEO of Ingo, discusses the acceleration of digital payment adoption amidst the pandemicVenminder opens registration for its third-party risk management bootcampSparkBeyond partners with DemystData to provide contextual data for smarter decision-making

Firm NewsThe latest installment in our ‘OG’ blog series features MissionOG advisor Marge Connelly on how banking and the credit market may evolve during the COVID crisisManaging Partners
George Krautzel Gene Lockhart Andrew Newcomb

Operating Partner
Michael Heller

Senior Advisors
Rob Metzger Bob Nolan David Roberts |Ted Saunders    
                                                     
Venture Partner
Victoria Lopez-Negrete 
About Us
MissionOG partners with high-growth businesses that have proven models in segments where we have had success as operators and investors, including financial services and payments, data platforms, and software. To help accelerate our partner companies, we invest financial capital and leverage a broad network of industry experts. 

MissionOG is led by a team that has effectively built and scaled companies through their various stages of growth to successful acquisitions.