1. How to use GuruFocus - Tutorials
  2. What Is in the GuruFocus Premium Membership?
  3. A DIY Guide on How to Invest Using Guru Strategies
Sangara Narayanan
Sangara Narayanan
Articles (562) 

Salesforce Invests in the Future

Company’s forward-looking investments give it a distinct edge

October 12, 2017 | About:

As competition in the enterprise software segment has intensified, Salesforce (NYSE:CRM), the leader in the customer relationship management software market, has been steadily investing in next-generation technology companies. The company set up its fourth investment fund in May and pumped $100 million into the fund. Last month the company announced that it would set up a $50 million fund to invest in AI-focused startups that can build applications on top of Salesforce.

Salesforce Ventures, Salesforce’s strategic venture arm that invests in enterprise cloud companies, participated in the latest financing round for DNS company NS1. The $20 million funding round was led by GGV Capital with participation from Salesforce Ventures and existing investors Deutsche Telekom Capital Partners, Flybridge Capital Partners, Sigma Prime Ventures, Telstra Ventures and Two Sigma Ventures.

New York-based NS1 was founded in 2013, and the company specializes in DNS solutions and traffic management, things that are highly important for operations over the Web.

NS1 offers three major products

  • Managed DNS  cloud-based, intelligent DNS for application developers.
  • Dedicated DNS  platform for dedicated, fully managed deployments for on-premise as well as cloud customers.
  • Pulsar  automated traffic routing using real-time data.

According to the company:

"NS1's intelligent DNS and traffic management platform, with its data-driven architecture and unique Filter Chain routing engine, is the first DNS technology to address the needs of today's distributed, dynamic and automated application architectures. NS1's purpose built software and services are trusted by the largest internet and enterprise brands, including customers like LinkedIn (NYSE:LNKD), The Guardian, Dropbox, Weight Watchers (NYSE:WTW), Salesforce and many others."

Salesforce Ventures was founded in 2009, and the venture arm has invested $700 million in more than 250 startups since then. On a stand-alone basis, investing in a company like NS1 that helps enterprises manage web traffic is not going to make much of a difference to Salesforce. But what is important to note here is that Salesforce has been extremely active in finding technology companies that can improve their solutions or work on top of their solutions and invest in them.

Instead of trying to build every new solution from within, Salesforce is smartly using its money and investing in companies that can build next-generation solutions, and if it builds a breakthrough product, Salesforce will be one of the first companies to know about it and will surely buy it before anyone else can.

Disclosure: I have no positions in the stock mentioned above and no intention to initiate a position in the next 72 hours.

About the author:

Sangara Narayanan
Sangara Narayanan holds an MBA from Kent State University, Ohio, and has worked on the floor as a trader in New York. You know where. He is passionate about capital markets and specializes in business analysis, stock valuations and making chicken curry

Rating: 0.0/5 (0 votes)


Please leave your comment:

Performances of the stocks mentioned by Sangara Narayanan

User Generated Screeners

chrislphillipsf score
chandra3_16No Debt Graham
ryangcii252-Week Lows (US)
eguruguyMOS 25 +++
cirrostop 6 pm
Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to $400 per referral. ( Learn More)

GF Chat