eWEEK at 30: Salesforce Shows Enterprises How Cloud Computing Works
Salesforce has many value propositions, but the main one that has put the company in the history books is that its Web-based tools set workers free to work from any location, on any device, and at any hour of the day. It also enables enterprises to obtain business services that they otherwise would have to collect individually or develop on their own, and generally for far less cost. Financially, there is a long list of significant facts and figures connected with Salesforce.com, to be sure, but one astounding factoid is this: Here is a world-renowned company, growing by leaps and bounds in number of customers, income and influence that has not yet posted a profit. You read that correctly. Salesforce started in the red in 1999 and 15 years later it's still officially in the red—although the company has nearly $1 billion in cash. Its market cap is $34 billion, and the stock price has been in the $50 to $55 range for the last five months. This growth all has been at a steady pace. After one year in business, in 2000, the company had a respectable 1,500 customers. By 2001, the number had doubled to 3,500; by 2004, it was up to 14,000; and by 2008, it was at 51,800. The company broke the 100,000 customer mark in 2011 (104,000) and continues to add multiple thousands each year.However, founder, CEO and Chairman Marc Benioff insists that black ink is around the corner because there's so much business coming in the pipeline—$4.2 billion worth in deferred revenue, according to figures released by the company in its fall 2013 quarterly report. So things are looking up, as they say. An 8,000-Employee Company That Thinks It's a Startup Since Benioff, a fourth-generation San Franciscan, left Oracle and founded Salesforce.com in March 1999 in a rented Telegraph Hill apartment, the company has grown to become a $34 billion conglomerate with 8,000 employees and 130,000 customers. Its headquarters is at One Market Street, the renovated office complex that was once the headquarters of the South Pacific Railroad, a bastion of old-school American industrialism before it was taken over by rival Union Pacific Railroad. Benioff told eWEEK in 2011, "We have 6,000 people working at Salesforce, but we still have the feeling of being a startup." Benioff knew what he wanted with Salesforce early on, said Charles King, principal analyst with Pund-IT in Alameda, Calif.
Last November, Salesforce.com became the first enterprise cloud computing company to deliver a $1 billion quarter. In its third fiscal quarter, which ended Oct. 31, Salesforce reported that its revenue rose 36 percent to $1.08 billion, exceeding Wall Street expectations. However, the company reported a loss of $124.4 million, or 21 cents a share, compared with $220.3 million, or 39 cents a share, a year ago.