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Salesforce integration partners fund offers $50 million boost

Salesforce has unveiled a fund that will provide capital to young consulting and integration firms looking to scale their businesses; other news from the week.

Salesforce has launched a fund that industry executives said could help the company replenish the ranks of Salesforce integration partners.

In recent years, a number of notable Salesforce integrators have been acquired by larger firms. The pattern began in 2015 with Accenture's purchase of Cloud Sherpas. In 2016, IBM bought Blue Wolf Group LLC, and Wipro Ltd. announced its acquisition of Appirio.

Against that backdrop, Salesforce Ventures, the company's corporate investment group, now manages the $50 million SI Trailblazer Fund that Salesforce said "will be dedicated to the next generation of cloud consulting firms." The fund will provide capital to help emerging Salesforce integration partners to scale their services, according to the company. Salesforce also kicked off an SI Trailblazer Alliance Initiative to provide the Salesforce integration partners in its portfolio with resources and training.

Salesforce identified three SI Trailblazer Fund investments: 7Summits, an online community consulting partner; Arxxus, a provider of Salesforce professional services in Australia; and ATG, a quote-to-cash advisory and implementation services firm.

"There is no question that Salesforce is trying to fill the void left by the acquisitions" of consultancies such as Appirio, Bluewolf and Cloud Sherpas, noted Jeff Kaplan, managing director of THINKstrategies Inc., a consulting firm in Wellesley, Mass., that focuses on cloud computing and other on-demand services.

Kaplan said the major systems integrators are trying to keep pace with the escalating demand for cloud, software as a service and other digital transformation skills. But despite those efforts, Salesforce "recognizes that its greatest impediment to continued growth is the availability of professional expertise to help Salesforce's customers adopt its latest solutions," he added.

There is no question that Salesforce is trying to fill the void left by the acquisitions.
Jeff Kaplanmanaging director of THINKstrategies Inc.

Tony Safoian, president and CEO of SADA Systems, a cloud partner and business and technology consulting firm based in Los Angeles, suggested the Salesforce integrator fund aims to address the midsize business market, which he characterized as underserved. He said thousands of integrators serve local markets, but very few grow to the point where they can support midmarket customers with 1,000 employees or more. And those companies that grow to a size capable of serving such customers tend to be acquired. In addition, the economic models of the large integrators are such that they don't typically pursue customers in the 1,000-employee range, Safoian noted.

"The midmarket is perpetually underserved, and I think Salesforce recognizes this," he said.

Kaplan said Salesforce's move to establish a specific fund to support systems integrators is unusual. However, he noted venture funding of integrators is on the rise, citing cloud service provider 2nd Watch's recent rounds of investment.

SADA Systems teams with BenQ for Jamboard

In the cloud collaboration space, SADA Systems is linking up with BenQ, a visual display solutions provider, to offer Google Jamboard digital whiteboards.

The Jamboard is a 55-inch, 4K ultra high-definition device that is touch-enabled. Jamboard retails at $4,999, a price Safoian said is about half the cost of some competing digital whiteboards. He said the Jamboard's price point makes the technology more accessible to companies looking to update conference rooms and other production and work environments.

Safoian said he anticipates the initial market for Jamboards will be existing Google G Suite customers who would pursue the technology as a new form factor to extend the G Suite platform. It's yet to be seen, however, whether new customers will view Jamboard as a point of differentiation that influences them to adopt G Suite, he said.

Other news

  • IT trade association CompTIA's IT Industry Business Confidence Index dropped four points in the second quarter to 64.2 on a 100-point scale. The drop comes after the first quarter's "record-setting high" of 68.2 in the first quarter, CompTIA said, which noted the Index remains strong despite the second-quarter decrease. According to CompTIA, the Index is projected to bounce back in the third quarter to 66.6.
  • Distributor Ingram Micro will offer a range of financing options to qualifying partners through its newly unveiled Technology as a Service program. The financial options include flexible leasing that bundles IT services and technology into a consolidated monthly invoice, hardware as a service or as a rental and funding for recurring revenue model engagements.
  • LogicMonitor, a cloud-based performance monitoring platform provider, released a platform that it said is customized to the needs of service providers. According to the company, the Service Provider Platform is built around the core monitoring platform that is used by web technology and enterprise customers, but offers features specific to channel partners.
  • Security software company Avecto, which retooled its North American partner program in April, expanded its roster of Gold partners with Cadre, a value-added reseller based in Edmond, Okla.
  • TierPoint LLC said it plans to build a data center in the Tulsa, Okla., area. TierPoint, partnering with Compass Datacenters, said it anticipates the new facility will have about 60,000 sq. ft. of space.

Market Share is a news roundup published every Friday.

Next Steps

Read about Salesforce partner Conga's partnering efforts

Learn about the Salesforce developer certification

Gain insight into Cisco's digital whiteboard offering

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Salesforce integration partners are being targeted for investment. What other cloud platform vendors are offering funds to grow consulting businesses?
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