CloudSense is one of the largest Salesforce ISV partners but is less well known than others of its size, partly because it's based in London rather than Silicon Valley, but mostly because of a British disdain for brash self-publicity. This week's $77 million investment from private equity firm Vector Capital marks the first time the company has chosen to disclose a funding round. It's had several already, but isn't disclosing how much it has previously raised. This time it's different, says CEO Richard Britton:
This one was of the order of magnitude that we thought it warranted celebrating. It's clearly the biggest investment round into a Salesforce ISV that we've seen for some time and therefore it's something we wanted the market to hear about.
The Salesforce-native ISV was founded in 2009 and now has more than 70 large enterprise customers across the telecoms, media and energy sectors, including Vodafone, Telstra, News Corp, the Financial Times, EDF and British Gas. Its software provides order management, configure-price-quote, contract lifecycle management, and ecommerce for these very complex, high-volume businesses.
CloudSense vs Vlocity
As such, it's very similar to Vlocity, which positions itself as a pioneer among vertical industry cloud providers, even though CloudSense has been around for several years longer. And while Vlocity CEO David Schmaier was happy in Monday morning's ISV keynote session to reveal his company's revenue of $50 million in its most recent year and a projected figure of $100 million for next year, Britton isn't divulging any indication of CloudSense revenues. Asked about the comparison to Vlocity, he merely says:
CloudSense is a bigger and more established business. Though I would say, our focus is very much around ensuring we provide the industry-specific commerce software that our customers need to be able to drive more sales, facilitate those sales, get to market more quickly, reduce their expenditure while doing so, and digitalize and modernize the customer experience.
The investment from Vector, which has previously invested in SaaS companies Saba Software and CollabNet, will mostly fund expansion in the US market. CloudSense already has customers here including Hawaiian Telcom and Spotify, says Britton.
We see the market opportunity is still tremendous and we have a great momentum in the US. We've had lots of good wins and you'll see me on stage this week with Hawaiian Telcom, who are using us to transform for digital.
As well as vertical industry specialist Vlocity, the quote-to-cash market also has strong horizontal players such as Apttus and Salesforce itself, after its acquisition of Steelbrick two years ago. But Britton is confident CloudSense can hold its own.
We've got a very proven product. We chose some great technology when we started out with Salesforce. We've had time to mature our proposition so it works with very sophisticated use cases that competitors cannot address.
We do replace the likes of the companies you've mentioned in accounts where they haven't been successful.
When customers are looking for an industry-specific commerce solution designed for the industry they work in, they won't find a more capable product in the market for large enterprises.
The strength of the quote-to-cash market was emphasized again by the news that Simplus, a consultancy that specializes in Salesforce QTC, the former Steelbrick product, has made its fourth acquisition of the past year. It has bought CRM Manager, one of the oldest Salesforce partners, adding to its tally of BaldPeak, EDL Consulting, and Basati. Established in 2005, CRM Manager brings a 1,000-strong customer base.
A year ago, Simplus announced a $7 million funding round led by Salesforce Ventures.
Quote-to-cash embraces all the activities that sit between the prospect acquisition pipeline traditionally covered by sales automation software and the order processing and invoicing provided by financial and ERP software. In B2B sales, or in high-volume B2C service environments such as telecoms and utilities, these can be a very complex set of processes. They are ripe for cloud automation and the growth stories we see here are evidence of the opportunities for this product set.