Oracle Acquires DataFox

Oracle recently acquired DataFox, providing them with access to 2.8 million company profiles, including funding and M&A data.  DataFox “gives customers real-time insight to know when a business exhibits noteworthy behaviors.”

“The combination of Oracle and DataFox will enhance Oracle Cloud Applications with an extensive set of trusted company-level data and signals, enabling customers to reach even better decisions and business outcomes,” wrote Oracle’s EVP of Applications Development Steve Miranda to customers and partners.

Oracle provides the following deal shorthand:

Oracle Cloud Applications + DataFox = Even Smarter Decisions

DataFox is growing its database at 1.2 million companies annually.  The database will deliver real-time insights into its cloud-based ERP, CX, HCM and SCM platforms.

DataFox Data Engine Overview (Oracle Presentation, October 23, 2018)
DataFox Data Engine Overview (Oracle Presentation, October 23, 2018)

In a bit of extreme puffery, Oracle described DataFox as the “the most current, precise and expansive set of company-level information and insightful data.”  Bureau van Dijk and Dun & Bradstreet have 50X the active company coverage including detailed global linkage, risk models, and multi-year financial data.  Bureau van Dijk also offers the Zephyr database, an M&A and funding dataset with over twenty years of closed, pending, and rumored deals.  Where DataFox may have an advantage is in their focus on mid-size and emerging companies which have been recently funded, but this is a small subset of the company universe.

DataFox will continue to sell and support its products.  However, the DataFox roadmap and product line are fluid:

“Oracle is currently reviewing the existing DataFox product roadmap and will be providing guidance to customers in accordance with Oracle’s standard product communication policies. Any resulting features and timing of release of such features as determined by Oracle’s review of DataFox’s product roadmap are at the sole discretion of Oracle. All product roadmap information, whether communicated by DataFox or by Oracle, does not represent a commitment to deliver any material, code, or functionality, and should not be relied upon in making purchasing decisions. It is intended for information purposes only, and may not be incorporated into any contract.”

Along with AI insights, Oracle called out the needs for quality data to back data maintenance, artificial intelligence, and business signals.

Customer Data Challenges (Oracle Presentation, October 23, 2018)
Customer Data Challenges (Oracle Presentation, October 23, 2018)

DataFox has over 275 customers including Goldman Sachs, Bain & Company, Outreach, Live Ramp, and Twilio.

DataFox raised $19 million in funding.  Terms of the deal were not disclosed.  In January 2017, DataFox was valued at $33 million by Pitchbook.

Oracle should study Salesforce’s acquisition of Jigsaw (later renamed Data.com) as a cautionary tale.  Software companies struggle in selling data files as company and contact data decays rapidly and it is difficult to push data quality above 90% absent large editorial investments.  Furthermore, Jigsaw never represented more than 1% of Salesforce revenue so quickly fell off of the company’s internal radar.  The firm is now looking to decommission Data.com and asking its AppExchange partners to fill the sales intelligence and data hygiene gap left in its absence.  Coincidentally, DataFox is one of Salesforce’s Lightning Data partners.

On the positive side, LinkedIn hit $1.3 billion last quarter and has thrived under Microsoft’s ownership.  However, LinkedIn was a much more mature company at acquisition than DataFox with multiple revenue streams and a unique user generated content model.  Microsoft has provided LinkedIn with development capital and allowed it to maintain its independence.  It has also looked to leverage LinkedIn and Microsoft strengths when building sales and marketing products, instead of simply copying other vendors.  For example, Sales Navigator continues to respect the privacy of its members while using aggregated data to provide hiring and employment insights that other companies cannot deliver.  Navigator has also added strong messaging tools (chat, InMail, and PointDrive) which work around its lack of company emails.  Other innovations include SNAP workflow connectors, its new Pipeline CRM updating tool, and Buyer’s Circle for identifying the buying committee at large firms.

HG Data: CEO Interviews (Part III)

 

HG Data Technographics may be used for building AppExchange Workflows. For example, separate workflows can be employed for prospects using competitor or complementary platforms.
HG Data Technographics may be used for building AppExchange Workflows. For example, separate workflows can be employed for prospects using competitor or complementary platforms.

I sat down with Craig Harris and Elizabeth Cholawsky of HG Data last month. Elizabeth had joined HG Data as their new CEO eight days earlier with Craig shifting from CEO to R&D Leader and Chairman. We discussed the transition, partner management, product planning, and the entry into other information verticals. The interview has been edited for length and will be published over the next few days.  [Part 1; Part II]


Michael: As you continue to build out the IT vertical, do you see yourself beginning to compete against your partners, and how do you anticipate that playing out in the coming years?

Craig: I don’t see that being an issue. If you actually map out our partner ecosystem, what you’re going to find is there are about 12 to 15 different applications of data that these partners deliver. There are some companies that try to be a Swiss Army knife – shallow amongst lots of different applications. Most of our partners are really domain experts in a focus area.

Look at where we are anchored currently, HG Data for Salesforce.  Many of our partners are also inside the Salesforce ecosystem. We don’t compete with our partners that have managed applications, even our partners that have Lightning Data apps.  We are still solving different types of problems with our Salesforce applications.

Our focus right now is really on the systems of record. There are a few other CRM systems that we have our eyes on as well as marketing automation. We are looking for a way where we can be embedded in the systems of record and be synergistic with partners as opposed to competing with them.

Michael: When you look at some of your key partners like DiscoverOrg or TechTarget, they built out other content functionality that you don’t have. It seems like you will not be looking to build those in the next two to five years. When you have those shallower applications, they are just licensing technographics and putting it in with your basic prospecting. I could see those less inventive platforms becoming more competitive with you as you build out some of your functionality there.

Elizabeth: There is a complementary strategy consisting of a really strong partnership and channel strategy, combined with still going the route of allowing our data to be productized through leading systems that people use. There will be conflict with some. That’s just the competitive situation that’s been endemic to the technology industry broadly, forever.

The issues are solvable when you have a good strategy laid down. You go into the partner relationships explaining that strategy and where you want to play and why you want to do that. To me, that comes back to the customers, their use case and how they want to consume the data that we’ve got.

It’s a big expanding market out there. I think there is a lot of room for really high growth, with both vital channel partners, as well as doing what we’ve embarked on with the systems of record.

Michael: What size and growth metrics are you comfortable disclosing?

Craig: Not much. We’re 57 employees. As I alluded to earlier, we have an eight-figure run rate, so that leads to a pretty big range. We’re not disclosing [revenue] publicly. I will say, anecdotally, we had a great year of revenue growth.

Michael: What is your split today between content licensing and direct sales? Do you see that shifting much going forward?

Craig: Probably close to the 50-50 mark.

Michael: Probably wasn’t 50-50 two years ago.  That’s a significant gain on the direct sales side then?

Craig: Yes. HG Data for Salesforce has been a very nice contribution to that as has our display advertising and HG Data Audience product line. The end user, they don’t necessarily want to go log in to ten more systems when they’re trying to solve a very specific problem. Who are my best prospects? Who should I talk to? What types of conversations should I have and what types of key strategic insights can I use and when? For us, this is all about having our data at the right place at the right time for the right person – to help them solve the thing that they care about which is: Who’s my next customer?

We are not going to do this alone. We are going to need partners for that journey.

HG Data: CEO Interviews (Part II)

HG DAta Harris

I sat down with Craig Harris and Elizabeth Cholawsky of HG Data last month. Elizabeth had joined HG Data as their new CEO eight days earlier with Craig shifting from CEO to R&D Leader and Chairman. We discussed the transition, partner management, product planning, and the entry into other information verticals. The interview has been edited for length and will be published over the next few days.  [Part 1]


Michael: Craig, let’s talk about your new role and the future of HG Data.

Craig: Over time we’ve ingested and continue to ingest billions of company documents. These documents don’t just cover IT or technographics. They span every geography, every vertical, every category.  Technographics is really just scratching at the surface. There are so many more insights within our corpus, and we’ve already built the tools and have the machinery to extract them. That’s where I want to spend my time. That’s where I want to focus.

That means a couple of things. It means going much deeper in this phase that we’re already in. Going beyond just company X is using product Y. There’s so much more context and insight and actionability that we can mine around the technographics that we are already selling to the market. There are other opportunities beyond technographics and we’re already monetizing that in the digital display part of our business, which is growing really fast.

I think this is just a perfect partnership between Elizabeth and myself. I get to go back to what I love the most which is the R&D. We’ve got a real pro here at home that can help us scale to the next revenue milestones and beyond.

Michael: The other industry that you’ve entered is healthcare. You partnered with `.

Craig: Yes, that was a couple of years ago. Our thesis is, we’ve got this massive corpus of information, can we extract information beyond technographics? Doing our deep dive into healthcare, of course, we started with the specialized software and hardware products that are used within healthcare organizations.

Quickly from there it became looking at equipment that you used in the operating room or how many beds are at certain healthcare facilities. That was very much a successful test of our ability to move into other verticals. That quickly became a very meaningful business for us. We’ve already proven that we can replicate what we’ve done in the technographic space.

More importantly, beyond technographics, there’s so much opportunity in the space that we’re currently in. We launched our HG Data for Salesforce product in November, so this is really one of our first forays into going and putting more of an experience around the data. This is an area where having someone with Elizabeth’s experience just puts us in a great position to explore those avenues.

Michael: Lightning Data is just an application – Account data maintenance within the AppExchange. It’s a small subset of the broader scope of applications in the AppExchange.

Elizabeth: Right. Yes. We’re working closely with them and talking about co-marketing opportunities to get a little more visibility around the Lightning Data app.

Michael: You have some other products you also launched around marketing analytics last year?

Craig: Well, so we’ve got the HG Data Platform. I wouldn’t really call it a product but an introductory way to discover the different data sets that we have available. It also has light analytics in terms of growth of those products by geography and other types of firmographics.

But really the main product launched is HG Data for Salesforce. That’s our premium offering inside Salesforce. We also have a demo version called HG Data for Salesforce Lite.  We just launched that.

HG Data Focus [Chrome extension] is a tool used by thousands of sales reps and BDRs and marketing folks. That’s been a wonderful way to experience our data.

The other product launch was HG Data Audience. It’s our digital display advertising offering where we’ve worked with third-parties to get our data put into the systems or the workflows for building both syndicated audiences as well as custom audiences.

That product is growing really fast.  It’s branded and available inside of Oracle Data Cloud, LiveRamp Data Store, DoubleClick Bid Manager and many others

Michael: Craig, going out five years, where do you see the company on the product side?

Craig: With technographics, if you look at some of the partners that we have within the HG ecosystem, we’ve identified at least a couple dozen different use cases and applications for our data. That’s just looking at the sales and marketing ecosystem. The enormity of what could be powered by HG, if we choose to build that ourselves for end users inside of their workflows, is exciting. Or, we may decide in certain scenarios that there are other companies that are just so good at that particular delivery of service to customers that we are more impactful powering that application It just makes a lot more sense to leverage partners in certain circumstances.

What I see happening over the next two to five years starts with technographics. We are going to choose some of those areas of application and we are going to build and power really wonderful experiences with our data directly for end users. And with many other applications for sales and marketing, if not the majority of other applications, we are going to continue working very closely with the wonderful partners that we have been working with for so many years. Over the two to five-year time-frame, I believe that we have the opportunity to go and replicate that same experience in a multitude of other vertical markets.

That’s where I’ll be spending a lot of my time just exploring which other verticals and markets we can go into and build unique data sets. Currently, I believe that we deliver the holy grail of data within the software and hardware space. Part of the holy grail of data is technographics.  As we evaluate moves beyond healthcare and we move into manufacturing or transportation or any number of verticals, the definition of the holy grail of data becomes very different. That’s where I’m going to be spending the better part of the next several years working as Elizabeth helps provide some guidance. We are going to be very deliberate with the next markets that we choose to move into.

Michael: What sort of time-frame do you see yourself entering these additional verticals?

Craig: Right now, I think the focus and the priority is optimizing the areas that we are already in, so there’s a lot more work to do in technographics and healthcare before we start jumping in those multiple other verticals.

My vision for HG Data five years from now is that HG Data has become the de facto leader in the technographic space – not just building the data and surfacing the data, but in putting it to work for our customers.  At the end of the day our customers don’t care about technographics. They care about knowing who their next customer is going to be or how they are going to retain and grow their existing customers. Five years from now I hope that HG Data will be informing this in the IT vertical as well as four or five other vertical markets.


Part III covers partnership strategy and company performance metrics.

SFDC Unplugging Data.com Connect

Salesforce Lightning Data partners include Clearbit, HG Data, Bombora, MCH, and DataFox. InsideView and Dun & Bradstreet were not included in this week's announcement.
SFDC is promoting Lighting Data solutions as an alternative to its Data.com Prospector and Clean offerings.  Salesforce Lightning Data partners include Clearbit, HG Data, Bombora, MCH, DataFox, InsideView and Dun & Bradstreet.  Additional partners are planned.

Salesforce told its Data.com Connect customers that the product will no longer be available as of May 4, 2019.  As such, the firm will not renew any customers after May 3rd of this year, and users will not be able to license any points, contacts, or plans after May 3rd.  However, users will be able to earn points through community updates through the expiration of the product.  While Salesforce has not announced shutdown dates for the native Salesforce Data.com Clean and Prospector offerings, their shutdown is “currently targeted for some time in 2020.”

Data.com Connect contacts data will continue to “used in the maintenance of the Data.com Clean and Prospector products,” said the firm.  “After the Data.com end-of-life is complete, the contact database may be archived by Salesforce.”

Data.com Connect is the successor to Jigsaw, which the firm acquired in 2010 for $142 million.  Connect Members either purchased plans or earned points through adding and maintaining records within Connect.  After acquiring the database, Salesforce realized that Jigsaw company data was too weak to be sold and partnered with D&B (now Dun & Bradstreet) to deliver the WorldBase company file alongside Jigsaw contacts.  This partnership was in place until early 2017 when SFDC announced the end of the licensing relationship.  Legacy customers continue to receive Data.com WorldBase account data, but the firm is encouraging clients to evaluate Lightning Data partnership offerings from Dun & Bradstreet, Bombora (intent), HG Data (technographics), DataFox, Clearbit, MCH (healthcare), and InsideView.

Future Lightning Data partners include Thomson Reuters, Aberdeen (technographics), Datanyze (technographics), Compass, and Equifax.

“We’ve built a powerful, flexible set of capabilities into the Salesforce platform we call the Lightning Data Engine.  It uses sophisticated matching algorithms and machine learning to make it easy to implement and deliver strategic data and insights from trusted, third-party sources. Lightning Data apps give customers next-level data quality, enabling them to create more intelligent processes built on better, more targeted data, which improves CRM user adoption and ROI. Best of all, seamless integration requires minimal ongoing maintenance, and makes data readily available on any device without IT involvement.”

  • Salesforce.com

Dun & Bradstreet said that it expects Data.com revenues to decline 30% in 2018.  The announcement that the Data.com Prospector and Clean products will be shuttered in 2020 is likely to expedite the revenue wind down.

Dun & Bradstreet Announces Deal with SFDC for Data.com Transition

 

Optimizer for Salesforce supports Account Segmentation by Revenue, Employees, Industry, and Location.
Optimizer for Salesforce supports Account Segmentation by Revenue, Employees, Industry, and Location.

For the past nine months, there has been great ambiguity around the future of Data.com, a pair of AppExchange services which combine the old Jigsaw contact file with Dun & Bradstreet account and industry intelligence.  Salesforce has remained mum throughout with Dun & Bradstreet providing details on their earnings calls.

Dun & Bradstreet CEO Bob Carrigan announced that Dun & Bradstreet and Salesforce will be offering a path forward for Data.com clients. In August, Salesforce Data.com stopped offering D&B content for new clients, but legacy clients continued to receive D&B WorldBase, Hoovers, and First Research insights. However, the long-term direction of Data.com remained ambiguous as service revenues declined due to “natural attrition.” Carrigan announced that the two firms have agreed on a transition plan to migrate Data.com customers to D&B Hoovers and the new D&B Optimizer for Salesforce.

D&B Hoovers represents a significant upgrade for Data.com Prospector customers as they will receive deeper global company and contact coverage than before. Users will have access to a deeper set of global contacts, a broader set of screening variables, and company intelligence including financials, filings, SWOTs, news, sales triggers, and alerts.

Optimizer for Salesforce will launch next week at Dreamforce where Dun & Bradstreet will have a larger presence than in previous years. Product specifics were not provided on the call, but some details were posted on the AppExchange Lightning Data site. D&B Optimizer offers a data management dashboard, account record matching using DUNSMatch logic across eighty variables, segmentation analysis (revenue, employees, industry and location), family tree linkage opportunities, duplicate record management, and out of business flagging.  Updates are made every fifteen days.

D&B Optimizer creates “virtual corporate family trees”
D&B Optimizer creates “virtual corporate family trees”

Optimizer for Salesforce is listed at $22 per user per month, $3 less than Data.com Clean.  It is currently available in the US and UK.

“For organizations to grow, they need actionable and complete data across the entire business to ensure that timely and informed decisions are being made.  D&B Optimizer for Salesforce provides Salesforce customers the ability to get the data they want, when and where they need it, directly within their Salesforce instance. This leads to increased productivity and, ultimately, growth for their businesses.”

  • Derek Slayton, General Manager of Sales and Marketing LOB, Dun & Bradstreet

Not only will Salesforce assist with transitioning clients, but they will also be referring prospects to Dun & Bradstreet. Dun & Bradstreet will recognize the full revenue from these products and own the customer relationships going forward, providing them with greater control over the product, increased revenue, and an end to their disintermediated status on the AppExchange.

According to Dun & Bradstreet CFO Richard Veldran, Salesforce revenue is “in the neighborhood of $50 million, because they’re not selling new on their side.” In the short term, that revenue will decline due to “natural attrition.” However, as customers are converted to D&B solutions, the firm will no longer be on a revenue share basis with Salesforce, resulting in in a revenue upswing.  It should be noted, though, that subscription revenue is ratable over the term of the contract so there will be a delay in this revenue recognition.

Salesforce AppExchange Redesign

Salesforce Lightning Data partners include Clearbit, HG Data, Bombora, MCH, and DataFox. InsideView and Dun & Bradstreet were not included in this week's announcement.
Salesforce Lightning Data partners include Clearbit, HG Data, Bombora, MCH, and DataFox. InsideView and Dun & Bradstreet were not included in this week’s announcement but showed up in the above announcement graphic.  InsideView has confirmed that they are developing two Lightning apps.

Earlier this week, Salesforce announced a set of enhancement and new partners on their AppExchange.  The firm is shifting away from Data.com and setting up an ecosystem of Lightning Data partners.

Salesforce is expanding the vision of the AppExchange to a “full blown ecosystem,” said Leyla Seka, EVP of AppExchange.  Along with Lightning Bolts and Data, the firm is also adding intelligent search results, personalized recommendations, industry collections, and Trailhead online learning tools associated with apps.  While 87 percent of customers have deployed apps, the new search and personalization tools will help customers “find the right solution and potentially solutions they didn’t know were available.”

With over 4,000 partner solutions, improved search and recommendations are necessary, particularly as they are merging the various AppExchange stores.  According to Salesforce VP of Marketing Leslie Tom:

“The way that the AppExchange worked was that there were separate stores, such as a separate store for apps, a store for components, and a separate store for consultants — so consultants stayed within their own store; you couldn’t put the consultants in line with the apps and components and the other tools that people are using. In the new AppExchange, we’ve combined all of those things together to show the power of the full ecosystem.”

Salesforce evaluated B2B and B2C marketplaces when redesigning the AppExchange.  “Our aspiration is to be as much like your consumer life as possible in buying your enterprise applications. [To that end, we] tried to bring as many of the best practices from marketplaces into the AppExchange as we could,” said Heather Conklin, Salesforce VP of product management.  “We’re really anchoring this around the idea of being the Salesforce store – the store you need for everything that you do with Salesforce. It’s not just about apps anymore; it’s really so much bigger than that.”


Three Part Series:

  1. Lightning Data from SFDC
  2. Lightning Data Partners
  3. Salesforce AppExchange Redesign