

Salesforce.com Acquires Startup RelateIQ - moritzplassnig
http://recode.net/2014/07/11/salesforce-com-acquires-startup-relateiq/

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tlogan
RelateIQ is cool. I'm little surprised that they "gave up" so easily :-).

Regarding the exit, I would appreciate if somebody more experienced can give
example how much is this for 1st employee. The sold company for $360. First
employee probably got ~2% of stock options. They received $69 of investment
and there was some dilution.

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boomzilla
According to crunchbase
[http://www.crunchbase.com/organization/relateiq](http://www.crunchbase.com/organization/relateiq)
they took 3 rounds on top of seed funding. So in the best case scenario, each
round diluted by 20%, leaving the founder team and employees with ~50%
ownership (= 80% * 80% * 80%). Again, best case scenario, there is no
participating preferred, then 2% options will end up somewhere around .8%
(depending on the option pool), which is between 2.5M and 3M.

Worse case scenario, all rounds come with 3x participating preferred and much
bigger percentage than 20%, and the options pool got inflated to accommodate
more recent employees. So in this liquidity event, the VCs take 3 * 70 = 210M
out first, leaving 150M on the table. 2% options might end up being .1%
equity, resulting in 150K for the first employee (before tax).

The real number is somewhere between the two. From my experience, it's more
likely closer to the lower end than the higher end.

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danielpal
This seems to extreme. Starting with 2%, likehood is he was diluted 50 - 55%
across the 3 rounds. He end's up with 1.1%. Given the $390M exit, he get's
$4.2M. This doesn't take into account liquidation preferences, but also
doesn't take into account incentive plans either.

Let's say due to liquidation preferences he only takes half of that ($2.2M).
Given that he just made $2.2M and Salesforce is keeping RelateIQ as a whole
subsidiary, they'll want to make sure they retain the talent. So they will
probably sweeten the deal with an incentive package of 60%-80% of that(1.3M).
All in all, given he stays 3-4 more years, he'll likely come out with 3.5M to
6M.

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btrautsc
This sounds much more reasonable... thanks Daniel

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beej1981
Salesforce has been getting hammered on their lack of true analytics since the
last Dreamforce. They have positioned their new SF1 dashboards as analytics,
but anybody who knows better, knows that these are not analytics tools but
visualization tools.

I'm guessing RelateIQ was a way for them to calm the industry influencers
down, and give them a head start in plugging a significant hole they have had
when being compared to the legacy stack vendors.

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clairity
i'm genuinely curious what people liked about relateiq... when i looked into
it, it seemed like a much less functional salesforce with the addition of
automatically showing you the last contact you had with a customer (or
potential customer).

what made it interesting/differentiated as a product?

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nwenzel
Well that was fast.

The recent early-stage-company acquisitions are an interesting change in the
business world. The other, in my opinion, is the move to hold off on IPO until
later stages. It seems the opportunity to invest in growth is getting squeezed
from both ends.

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pcurve
Seems like salesforce game up on organic growth strategy long time ago. Just a
lot of acquisitions. Once you become their scale, I guess it becomes
impossible to innovate. Whatever works for them I guess.

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yogo
What does one have to do with the other? If you can afford it and it's
something you need then you buy it. It's only innovation if there is some
significant improvement.

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mrmch
Drat, kinda bummed about this acquisition (as a customer), but congrats to the
RIQ team on a great exit.

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daviddede
Yep, same here. I hate when products (companies) I use get acquired. It always
come with not-welcoming product changes.

Hope it doesn't happen to them.

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nomnombunty
I think RelateIQ has a really good product and I honestly thought they will
become a multi billion dollar company. Its a little sad to see that enterprise
startups with great products are having a much lower valuation than consumer
startups.

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AznHisoka
Umm.. outside of the Instagrams and WhatsApps of the world, name me 5 other
consumer startups aquired for more than $200 million within a year of
launching publicly?

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cnaut
Salesforce must have been getting scared

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malchow
Congrats to Steve and the magnificent team at RIQ!

