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November 10, 2015

Can Salesforce Solve Oracle’s Succession Problem?

When news broke that Salesforce had hired two investment banks to advise on potential takeover offers, in addition to investors taking notice, Salesforce’s shares spiked. It seemed the tech world would finally experience a mega multi-billion dollar deal. The calculations likely show (at least on paper) how great it could be for Oracle, Microsoft or SAP to acquire Salesforce. After all, Salesforce is a huge cloud computing business – and companies like Oracle, SAP and Microsoft are desperate to provide cloud-based services after years of being shunned.

How does Salesforce CEO, Marc Benioff fit into the equation?

This presents the one thing that no single spreadsheet can square. Benioff, who is only 50 (very young by CEO standards), is both the driving force and face of his company. His willpower played a huge role in helping Salesforce’s stock surge all these years. This is despite the company’s extended history of unprofitability. The CEO managed to get both analysts and investors to not only buy but also believe in his vision. Benioff, once a salesman, made Salesforce more than special.

Can Salesforce make it without Benioff?

The truth is that it is unimaginable that Salesforce can thrive without Benioff. This is especially true if the merger was to pull through. The thing is, most of the potential suitors, a few years ago believed that the cloud business was not anywhere close to being viable. More than 10 years after Salesforce CEO showed the way, the same companies are not transitioning elegantly.

So what would happen to Benioff if SAP or Microsoft bought Salesforce? For sure, there is no way he would be content as a head of any division. The CEO would also not be willing to report to someone else having built his company to a market cap of nearly $47 billion. By the way, according to Bloomberg estimates, Salesforce’s projected revenues for the coming year would stand at $6.5 billion.

At both of these companies (SAP and Microsoft), there is no room for Benioff to assume top spot. Recently, both Satya Nadella, Microsoft’s chief, and Bill McDermott, SAP’s CEO, were appointed to be the sole leaders of their company. It is highly unlikely that these leaders will step aside to pave way for Benioff.

So what will happen? Unless Benioff painfully decides to part ways with Salesforce altogether – for philanthropy, politics or other business endeavors – his presence could be more than problematic compared to the company’s pricey market cap when it comes to a deal. Financial markets are currently supporting huge mergers. However, the market is much less liquid for CEOs with big visions  that specialize in cloud software.

So which company can pull it off?

Oracle stands out as the only company that can manage to absorb both Salesforce and its CEO. Having worked at Oracle before, Benioff knows the business pretty well. In reality, Benioff is surely the ideal executive to oversee the much-needed transformation of Oracle.

If you are looking for the best way to conduct data migration in a production organization, then Salesforce data migrator is your best bet.


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Lisa Blant is a San Francisco based writer. She writes tech and finance articles. Lisa has previously worked with Fortune and CNNmoney. She knows a thing or two about Salesforce data migrator.

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