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Salesforce is buying MuleSoft at enterprise value of $6.5B

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Re: Salesforce is buying MuleSoft at enterprise value of $6.5B

#21

Post by oicu812 »

surbas wrote: post #18
toomuchtodo wrote: post #14

Earlier quoted context omitted.

Mulesoft, Zapier, Microsoft Flow, Automate.io, Tray.io, Integromat, Workato, PieSync, Dsync, OneSaas, Skyvia Defining "major" is hard, I think. You either select a few big providers for integrations, or you go long tail with hundreds. I think there won't be winner take all, as there are a lot of integration dollars to go around (enterprise, SMB, freelance/individual users, etc), and each integration system has their…

Few more: Dell Boomi, Segment.io, Pandium, Infomatica...

According to the Gartner Magic Quadrant[1] Informatica is number one, Dell Boomi is number two and MuleSoft is number three.

[1] https://solutionsreview.com/data-integration/whats-changed-2...

Re: Salesforce is buying MuleSoft at enterprise value of $6.5B

#22

Post by toomuchtodo »

philipDS wrote: post #7
toomuchtodo wrote: post #6

Earlier quoted context omitted.

http://www.businessinsider.com/zapier-35-million-annualized-...

Very impressive! Annual Run Rate is different from ARR though. Annual Run Rate is probably just taking one (or a few) months, and extrapolate that to a year. Still great progress for having raised to little though.

Agreed, sharp founding team.

Re: Salesforce is buying MuleSoft at enterprise value of $6.5B

#23

Post by Avshalom »

oicu812 wrote: post #11

This seems strange to me since Salesforce already has an ownership stake in the chief competitor to MuleSoft, Informatica Cloud. Salesforce was one of the four companies that took Informatica private [1] three years ago but it seemed like Salesforce was still treating Informatica, MuleSoft and the other cloud data integration solutions equally. Now if Salesforce fully owns MuleSoft, I expect them to prefer it over th…

Owning Mulesoft and having an ownership stake in IC means they win regardless of who wins.

Re: Salesforce is buying MuleSoft at enterprise value of $6.5B

#24

Post by abakker »

whoisjuan wrote: post #9

One year after their IPO? I don't get this. Why didn't they buy it last year paying a premium over the 17 USD a share of their public offering instead of paying a premium over the current 33 USD (or 40 USD I guess)? I don't understand the rationale behind these deals.

The price for a reasonable amount of due diligence, market proof, and disclosure.

Re: Salesforce is buying MuleSoft at enterprise value of $6.5B

#25

Post by philip1209 »

whoisjuan wrote: post #9

One year after their IPO? I don't get this. Why didn't they buy it last year paying a premium over the 17 USD a share of their public offering instead of paying a premium over the current 33 USD (or 40 USD I guess)? I don't understand the rationale behind these deals.

Could this be related to the tax law changes?

Re: Salesforce is buying MuleSoft at enterprise value of $6.5B

#27

Post by adventured »

whoisjuan wrote: post #9

One year after their IPO? I don't get this. Why didn't they buy it last year paying a premium over the 17 USD a share of their public offering instead of paying a premium over the current 33 USD (or 40 USD I guess)? I don't understand the rationale behind these deals.

That's like asking why didn't Yahoo, Google, Apple, Amazon etc. acquire Netflix after the Qwikster debacle when the stock imploded down to $7.x / share losing ~80% of its value (now $317 / share).

As irrational as it sounds (and it is), companies overwhelmingly prefer to chase strength in acquisitions. It makes everything about it look and sound better. They don't care about the cost difference, it's not their money/value being vaporized. They care about protecting their job, so they want positive optics, something that is perceived to move the needle on value.

Re: Salesforce is buying MuleSoft at enterprise value of $6.5B

#28

Post by nemo44x »

whoisjuan wrote: post #9

One year after their IPO? I don't get this. Why didn't they buy it last year paying a premium over the 17 USD a share of their public offering instead of paying a premium over the current 33 USD (or 40 USD I guess)? I don't understand the rationale behind these deals.

How do you know they didn’t try? Mulesoft doesn’t have to agree to terms of an offer.

It’s not like Salesforce could have even bought a large percentage of the shares when they went on offer. You don’t make 100% of the company available.

Sometimes companies ipo to prove to buyers that they believe their market value is higher than potential buyers think. I can’t speak for Mulesoft but their stock has been mainly excellent and their transition to a public company has been fantastic.

Mulesoft brought a great company to market and Salesforce was willing to pay a 23% premium. Mulesoft thought that was fair - today.

Re: Salesforce is buying MuleSoft at enterprise value of $6.5B

#29

Post by meritt »

philipDS wrote: post #7
toomuchtodo wrote: post #6

Earlier quoted context omitted.

http://www.businessinsider.com/zapier-35-million-annualized-...

Very impressive! Annual Run Rate is different from ARR though. Annual Run Rate is probably just taking one (or a few) months, and extrapolate that to a year. Still great progress for having raised to little though.

> Annual Run Rate is different from ARR though

What exactly does ARR mean if not Annual Run Rate?

Re: Salesforce is buying MuleSoft at enterprise value of $6.5B

#30

Post by dragonwriter »

meritt wrote: post #29
philipDS wrote: post #7

Earlier quoted context omitted.

Very impressive! Annual Run Rate is different from ARR though. Annual Run Rate is probably just taking one (or a few) months, and extrapolate that to a year. Still great progress for having raised to little though.

> Annual Run Rate is different from ARR though What exactly does ARR mean if not Annual Run Rate?

Accounting Rate of Return

https://www.investopedia.com/terms/a/arr.asp

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