LinkedIn acquired Redwood City SalesTech vendor Heighten and plans to integrate its technology into Sales Navigator. LinkedIn is looking to leverage feature sets around sales process tracking, pipeline reporting, and note taking. Last summer, LinkedIn acquired sales content sharing vendor PointDrive and recently completed the PointDrive integration into Sales Navigator.
With the announcement, Heighten immediately took down its website, but Doug Camplejohn, Head of Products for LinkedIn Sales Solutions, provided the following feature descriptions:
The sales process tracking feature allows reps and managers to take their sales playbook binder off the shelf and put it into software, making it easier to see actions and content relevant to each pipeline stage.
The sales pipeline reporting feature lets managers and reps see their current opportunities in a more efficient way, and update key opportunity fields like amount, close date, stage and next steps on a single screen, with all changes automatically written back to CRM.
Finally, the intelligent notepad makes it easy for reps to take free-form notes and rapidly move information back into their CRM system with a single click. It also gives them instant access to key deal content such as person and account profiles, collateral, and competitive battle cards. This feature brings note taking into the context of a specific sales opportunity, reduces the heavy lifting involved in CRM data entry, and gives sales reps insights on-command
It is unclear, however, which of these capabilities will be integrated into Sales Navigator. “Over the next few months, we will be evaluating which of Heighten’s features we’ll be bringing to Sales Navigator,” said Camplejohn. “I’m also excited by the caliber of talent that Heighten brings to LinkedIn.”
Heighten has a staff of ten.
“The Heighten intelligent workspace is truly unique in its ability to bring together all of the key systems salespeople rely on — CRM, calendar, email, social and delivered — in an innovative, intuitive, and user friendly way,” blogged Heighten CEO, Luke Braud. “This approach to sales productivity is a natural extension of LinkedIn’s goal to make Sales Navigator the best version of LinkedIn for Salespeople, the System of Engagement, and ultimately influence every relationship‐based sale for our customers.”
Heighten received $7.36 million in venture funding last September. The acquisition price was not disclosed.
Moody’s announced this morning that they are acquiring business intelligence vendor Bureau van Dijk for €3.0 billion (approximately $3.27 billion). Moody’s stated that “the acquisition extends Moody’s position as a leader in risk data and analytical insight.” The deal is subject to EU approval and is expected to close in Q3.
Bureau van Dijk will be acquired with approximately $1.3 billion in offshore cash and $2 billion in debt. Bureau van Dijk will be folded into Moody’s Analytics’ Research, Data & Analytics (RD&A).
Last year, Bureau van Dijk earned $281 million (€258 million) and posted and EBITDA of $144 million (€132 million). Bureau van Dijk has a ten-year Compound Average Growth Rate (CAGR ) of 9.3%. The firm anticipates $45 million of annual revenue and expense synergies by 2019 and $80 million by 2021.
Bureau van Dijk offers three major product lines:
Orbis – Financial analysis tools spanning 220 million companies. Information includes firmographics, public and private company financials, original documents, global family trees, shareholdings, news, and M&A research (Zephyr). Orbis provides the deepest set of global private company financial coverage tied to very strong linkage data including minority shareholdings. Orbis was redesigned last year with a new user interface and workflows. The Orbis product line is also available as regional and local products such as Amadeus in Europe, Oriana in AsiaPac, and Fame in the UK.
Mint – Sales intelligence product line
Catalyst – Set of workflow tools for valuation, transfer pricing, credit analysis, wallet sizing, etc.
All three product lines leverage the Orbis global company file which is collected from 160 information partners.
“Bureau van Dijk is a high growth information aggregator and distributor that positions Moody’s at the center of a unique network of global risk data,” said Raymond McDaniel, President and Chief Executive Officer of Moody’s. “This acquisition provides significant opportunities for Moody’s Analytics to offer complementary products, create new risk solutions and extend its reach to new and evolving market segments.”
The Bureau van Dijk customer base is split fairly evenly across 6,000 financial institutions, professional service firms, government authorities, and corporations. Key use cases include compliance, KYC/AML, risk decisioning, purchasing, transfer pricing, B2B sales and marketing, financial analysis, and economic research.
Moody’s listed a three-pronged product strategy post-acquisition:
Apply MA analytics to data to generate off-the-shelf financial metrics
Package BvD data subscriptions with MA analytical software & models
Enrich MIS/MA data sets with BvD’s proprietary identifiers
Moody’s will also be looking to extend Bureau van Dijk’s commercial presence beyond Europe and to non-financial customers. The acquisition helps Moody’s extend its addressable market beyond credit to provide “Moody’s-branded scores/assessments for tax risk, transfer pricing, compliance, financial crime, [and] supply chain management.”
“Moody’s is a highly regarded, authoritative source of credit ratings and analytical tools, with a strong brand and global reach,” said Mark Schwerzel, Deputy CEO of Bureau van Dijk. “The addition of Bureau van Dijk’s powerful information platform to Moody’s Analytics’ suite of risk management solutions presents a wide range of opportunities for us to better serve our combined customer base.”
Bureau van Dijk has been owned by a series of private equity firms with EQT acquiring the firm from Charterhouse Capital Partners in September 2014. At the time, the sale price was not disclosed. Charterhouse acquired Bureau van Dijk in 2011 from BC Partners for €960m.
EQT noted the following areas of investment during its ownership period:
Development of the organisational structure to prepare for further growth
Investments in the sales organization, including the introduction of a matrix sales structure, implementation of a global CRM system, and expansion of the salesforce
Strong focus on the development of new products and continued improvement of existing ones, e.g. the launch of a new user interface
Substantial investments in marketing and corporate branding
On December 9th, Microsoft announced closure of its $26.2 billion LinkedIn acquisition following EU approval. The full approval process took just about six months. Microsoft CEO Satya Nadella is “even more enthusiastic” about the transaction than he was in June.
Nadella listed the following “immediate term” integration scenarios:
LinkedIn identity and network in Microsoft Outlook and the Office suite
LinkedIn notifications within the Windows action center
Enabling members drafting résumés in Word to update their profiles, and discover and apply to jobs on LinkedIn
Extending the reach of Sponsored Content across Microsoft properties
Enterprise LinkedIn Lookup powered by Active Directory and Office 365
LinkedIn Learning available across the Office 365 and Windows ecosystem
Developing a business news desk across our content ecosystem and MSN.com
Redefining social selling through the combination of Sales Navigator and Dynamics 365
The emphasis on expanded opportunities for individuals to learn, compete, network, collaborate, and find jobs was a key justification of the merger. “While technology tools are not a panacea for current economic challenges, we believe they can make an important contribution,” said Microsoft’s Chief Legal Officer Brad Smith. “Microsoft and LinkedIn together have a bigger opportunity to help people online to develop and earn credentials for new skills, identify and pursue new jobs, and become more creative and productive as they work with their colleagues. Working together we can do more to serve not only those with college degrees, but the many people pursuing new experiences, skills and credentials related to vocational training and so-called middle skills. Our ambition is to do our part to create more opportunity for people who haven’t shared in recent economic growth.”
LinkedIn CEO Jeff Weiner views the transaction as an opportunity to expand LinkedIn’s Economic Graph “and ultimately help create economic opportunity for every member of the global workforce.” LinkedIn will operate as an independent division with “the same mission and vision, the same culture and values, the same brand, and the same leadership team.”
Weiner reiterated LinkedIn’s commitment to its members, their privacy, and information security. The firm “remains focused on growing LinkedIn and creating value for our members and customers with a focus on integrating LinkedIn products with Microsoft.
The EU placed a few requirements on the deal, but did not view the transaction as anti-competitive, a position held by Salesforce.com. The EU evaluated the impact on professional social networks, CRM solutions, and API access. As an accommodation, Microsoft committed to a five year period in which it will
Ensure that PC manufacturers and distributors would be free not to install LinkedIn on Windows and allowing users to remove LinkedIn from Windows should PC manufacturers and distributors decide to preinstall it.
Allow competing professional social network service providers to maintain current levels of interoperability with Microsoft’s Office suite of products through the so-called Office add-in program and Office application programming interfaces.
Grant competing professional social network service providers access to “Microsoft Graph”, a gateway for software developers. It is used to build applications and services that can, subject to user consent, access data stored in the Microsoft cloud, such as contact information, calendar information, emails, etc. Software developers can potentially use this data to drive subscribers and usage to their professional social networks.
Margrethe Vestager, EU Commissioner in charge of competition policy, said: “A growing number of Europeans subscribe to professional social networks. These networks are important for professionals to connect and interact and to find new career opportunities. Today’s decision ensures that Europeans will continue to enjoy a freedom of choice between professional social networks.”
LinkedIn has 467 million global members and supports two dozen languages. The firm continues to add members at the rate of two per second. Last quarter, LinkedIn earned $960 million across three divisions: Talent Solutions ($623 million), Marketing Solutions ($175 million), and Premium Subscriptions ($162 million).
LinkedIn rolled out a new Conversation Starter feature to promote system messaging via a lightbulb icon. The feature analyzes the target individual’s profile to provide a series of conversational options. After selecting a potential opener, the user can modify the text to their voice. Starters include recent profile updates, work anniversaries, recent posts, mutual connections, and shared backgrounds (e.g. alma mater, former employers, groups).
“We know that reaching out to reconnect, ask for advice or network for potential job opportunities can be intimidating, so we’ve added personalized conversation starters in LinkedIn messaging to give members authentic ways to break the ice,” the company said in a blog post.
Unfortunately, the Conversation Starters on their marketing video are mostly focused on connections. This could result in a spate of similar sounding openers that could quickly become SPAM. This focus could be simply a marketing oversight, but variations on “Hi Suzi, I noticed you have X connections at Google. Have you heard…” seem like a weak set of Conversation Starters. While better than cold messages such as “Hi Suzi, I’m reaching out to you because my company…”, their sample seems uninspired. Furthermore, the Conversation Starters do not contain any stored messages from the sales rep to expedite the message creation process.
LinkedIn will soon be rolling out a bot to assist with multi-party meeting scheduling.
Decommissioning Professional Edition Features
According to Intero Advisory, a LinkedIn coaching service, LinkedIn is looking to migrate sales clients from their Professional edition to Sales Navigator. As part of this effort, LinkedIn is dropping two features from the Pro service: 1) Premium Search Filters and 2) Notes and Tags for connections. LinkedIn said these features will be available through the end of March. Users have until then to download any Notes and Tags. To help accommodate users, LinkedIn is offering a free three-month trial of Sales Navigator which includes the transfer of Notes and Tags.
Harte-Hanks, which has been looking to sell off its Trillium Software data quality division for several quarters, found an acquirer in SyncSort. The $112 million transaction will combine the data quality and integration capabilities of the two firms with a focus on extending Trillium services into the Hadoop big data platform. The transaction is subject to regulatory approval.
“With most large enterprises making significant investments in Big Data for business and operational analytics, core data integration and data quality workloads are moving into Hadoop at a rapid pace,” said SyncSort CEO Josh Rogers. “As a pioneer in bringing high-performance data integration software to the Hadoop ecosystem, Syncsort sees an opportunity to extend our unique value with Trillium’s proven, best-of-breed data quality products. Together, we are a clear leader in the data integration and data quality market, and the logical choice for large enterprises seeking to chart a path to Hadoop. We look forward to working closely with Trillium’s customers and investing in the great products they have come to rely on.”’
Harte-Hanks has been slimming itself down the past few years. They sold off both their publishing group and Trillium Software and spun off Aberdeen Services (Aberdeen market research and Access CI technology database).
“Our announcement today is the result of a comprehensive process to maximize the value of the Trillium Software business in the growing Data Quality and Data Governance segment,” said Harte-Hanks CEO Karen Puckett. “Now Harte Hanks can wholly focus resources on our core strengths and capitalize on our unique combination of marketing strategy, analytics, and execution capabilities. The sale of Trillium Software, along with the cost reduction program we implemented in 2016, provides Harte Hanks with a stronger balance sheet as we move the Company on its path toward revenue stability and historically strong cash flows and improved profitability.”
In a recent Magic Quadrant on Data Quality Tools, Gartner placed Trillium in the Leaders quadrant and gave them high marks for the “strength and stability” of their core profiling, parsing, standardization, and matching functionality. Trillium also was noted for its “strong mind share and a very long and solid track record of delivering data quality solutions” and its growth in the cloud-based deployments.
On the negative side, Gartner noted concerns about pricing, “ease of installation, upgrade, and migration,” and the uncertainty that surrounds the Harte-Hanks divestment (the analysis was prior to the announcement).
LinkedIn continues the build out of its Economic Graph with the launch of LinkedIn Salary. The new tool provides salary data alongside other elements of the Economic Graph including jobs, employees, organizations, skills, and educational institutions.
“This includes salary, bonus, and equity data for specific job titles, and the different factors that impact pay such as years of experience, industry, company size, location, and education level — all of which becomes critical knowledge as you navigate your career,” LinkedIn wrote. “Also, rest assured that when you enter your salary, it’s immediately encrypted and remains private.”
The service provides a set of salary analytics related to job, experience, industry, and location. The user begins by specifying the position and location. They can then quickly filter by industry and experience. Both median salary and median compensation are immediately displayed along with a compensation histogram. Other details include annual bonus, commission, restricted stock units, and stock options. Other salary analytics include base salaries by company size, industry, education level, field of study, and top locations.
Another valuable tool is compensation data by position for key employers in a metro area.
The service is currently available in the US, UK, and Canada with plans to expand globally in 2017. To obtain full salary details, users must provide their salary details or have a LinkedIn Premium subscription.
Other vendors providing similar data include Glassdoor and Salary.com.
Other recent LinkedIn developments in the news:
LinkedIn anticipates that the Microsoft acquisition will close by the end of 2016. They are awaiting approval from the European authorities and then should be ready to complete the $26.2 billion transaction.
LinkedIn was blocked in Russia last week after they failed to comply with Russian rules concerning the housing of data related to Russian citizens. The service has six million Russian members. The block goes back to a 2014 law which was enacted after social media-fueled protests against the Putin regime.
Note: The link to the Glassdoor salary site was added on December 1st.
Microsoft co-founder Bill Gates supports the LinkedIn acquisition and views it as an opportunity to build a Facebook for business professionals. This perspective is in line with LinkedIn CEO Jeffrey Weiner’s vision of an economic graph that captures the broad scope of business activity.
“This professional feed in LinkedIn, that is how I want to learn about my career, my company, my industry, and I’m going back there,” Gates told Bloomberg last month. “If we can make that as valuable as the Facebook feed in the social world, that’s huge value creation and that’ll happen over a period of years.”
Gates contends that Microsoft and LinkedIn are more valuable together than as separate entities even though Microsoft stock slipped two percent on the announcement. “I certainly think that the value of the two companies combined is greater than the two by themselves, but I love the idea that the market wants us to show that,” he said.
Gates remains a member of Microsoft’s Board and is formally listed as a Technical Advisor to CEO Satya Nadella.
Dynamics 365 and AppSource
In other news, the firm continues to enhance the Dynamics platform (CRM and ERP) with the introduction of Dynamics 365 and Microsoft AppSource. “Dynamics 365 provides business users with purpose-built SaaS applications. These applications have intelligence built in. They integrate deeply with communications and collaboration capabilities of Office 365,” said Nadella. “Dynamics 365 along with AppSource and our rich application platform introduces a disruptive and customer-centric business model so customers can build what they want and use just the capabilities they need.”
The new Dynamics 365 platform will be available this fall.
Nadella views Office 365, Dynamics 365, AppSource (a newly launched SaaS app ecosystem for businesses), and LinkedIn as all working together to provide “services in the cloud where you can reason about the activity and the data underneath these services to benefit the customers who are using these services. So that’s what this notion of a graph represents.”
Nadella continued, “The professional cloud or the professional network helps usage across all of that professional usage. Whether it’s in Office 365 or whether you’re a salesperson using any application related to sales, you want your professional network there. Of course, it’s relevant in recruiting, it’s relevant in training, it’s relevant in marketing. So that’s really our strategy with LinkedIn as the professional network meeting the professional cloud. And so you were right to point out that these are all part of one overarching strategy, and ultimately it’s about adding value to customers.”
On Microsoft’s Q4 2016 earnings call this week, the firm reiterated their belief that the LinkedIn acquisition will close before the end of the calendar year.
Microsoft ($MSFT) put in a $26.2 billion cash bid for professional social networking company LinkedIn ($LNKD) yesterday. The deal is the largest transaction of the Satya Nadella era and represents a fifty percent premium over LinkedIn’s Friday closing price. The deal provides Microsoft an entrée into professional social networking, enterprise recruiting, and learning and development (Lynda.com). The deal also brings LinkedIn Sales Navigator into Microsoft’s enterprise product line.
Microsoft benefited from a dip in LinkedIn’s stock price earlier this year when the firm provided soft guidance for fiscal year 2016. Although the stock has rebounded some following a recent strong earnings report, the bid is below LinkedIn’s stock price at the beginning of the year.
The deal is expected to close later this year. Both boards have already approved the offer. Regulatory approval is required in the US, EU, Canada, and Brazil with the firm “confident” in approval.
LinkedIn Chairman Reid Hoffman called the transaction a “re-founding moment” for LinkedIn, which went public in May 2011.
Jeff Wiener will continue as the CEO of LinkedIn with no changes in the firm’s organizational structure. He will report directly to Nadella. LinkedIn will continue as an independent brand and product line but will move to integrate the social network and its products with Microsoft Office and Dynamics. Nadella is looking to accelerate LinkedIn’s growth rate while “partnering on product integration plans with the Office 365 and Dynamics teams.”
LinkedIn will be rolled into Microsoft’s productivity and business processes segment, which includes Office and Office 365.
One of the merger’s goals is to provide “a professional’s profile everywhere.” Microsoft noted that professional data is scattered in disparate silos which are often outdated and incomplete, but that “in the future, a professional’s profile will be unified and the right data at the right time will surface in an app, whether Outlook, Skype, Office, or elsewhere.”
“Now you have the ability whenever you’re looking up a contact not only to see that contact with the information that’s contained in active directory, but you can get at the full richness of their information in the professional network and who are all the others in their professional network, so that is sort of what we mean by the social fabric of your digital work and Office 365,” said Nadella.
Microsoft is also looking to leverage LinkedIn’s newsfeed service which they built upon the Newsle and Pulse acquisitions. Microsoft told investors that “since information lives in silos, professionals miss relevant news and waste time. In the future, the newsfeed will be the place to go for every professional to stay connected with the happenings in their network, industry, and profession. Beyond all this, the feed will be constantly informed and tailored to the happenings at work like the meeting coming up and projects underway.”
The intelligent newsfeed will increase membership, monthly active users, and ad revenue.
Likewise, Microsoft anticipates an improved digital assistant as Cortana leverages LinkedIn professional and news intelligence. “Just imagine you’re walking into a meeting and Cortana now wakes up and tells you about the people you’re meeting for the first time, but tells you all the things that you want to know before walking in and meeting someone, because you have the access to the professional network. Cortana is about knowing everything about you, your organization, the work and now the professional network,” said Nadella. “So really being able to reason about all of that and be your personal digital assistant, that’s truly the best professional digital assistance is a fantastic opportunity.”
Microsoft Dynamics sales reps will benefit from a direct connection with LinkedIn Sales Navigator allowing them to engage in social selling. The firm told investors, “this will transform the sales cycle with actionable insights and the ability for each seller to build deeper relationships with prospects and customers – all to accelerate results.”
Other end user benefits include improved “organizational insights and transformation” via LinkedIn Recruiter and “just in time social learning” via Lynda.
Nadella told Microsoft employees that the merger expands market opportunities for Microsoft:
We are in pursuit of a common mission centered on empowering people and organizations. Along with the new growth in our Office 365 commercial and Dynamics businesses this deal is key to our bold ambition to reinvent productivity and business processes. Think about it: How people find jobs, build skills, sell, market and get work done and ultimately find success requires a connected professional world. It requires a vibrant network that brings together a professional’s information in LinkedIn’s public network with the information in Office 365 and Dynamics…As these experiences get more intelligent and delightful, the LinkedIn and Office 365 engagement will grow. And in turn, new opportunities will be created for monetization through individual and organization subscriptions and targeted advertising.
The merger will make business professionals more productive while “reinventing selling, marketing and talent management business processes.”
The Economic Graph
Microsoft published the following summary of “The Professional World” covered by Microsoft and LinkedIn:
Microsoft sees the acquisition as an opportunity to merge the Microsoft and LinkedIn Graphs. In a presentation to the market, Microsoft stated that “today, all the information a professional needs to be successful lives in silos. By connecting the world’s leading professional cloud and the professional network, we can create more connected, intelligent and productive experiences. We also have the opportunity to accelerate the realization of the Economic Graph.”
The Economic Graph is LinkedIn’s BHAG (Big, Hairy, Audacious Goal). A good BHAG should be viewed as internally achievable even if others view it as simply fanciful. Furthermore, a good BHAG provides a long-term vision and mission for framing business decisions and motivating employees.
In March 2015, Weiner said that the Economic Graph’s goal is to “create economic opportunity for every member of the global workforce” of over 3 billion people and 780 million “professionals, knowledge workers and students” by capturing broad economic information including employees, companies, universities, jobs, skills, etc.
Other elements of the graph include a “profile for every company in the world”. Weiner sized this at 60 million to 70 million companies “if you include small and medium-size businesses.”
Beyond people and companies, the economic graph would “be a digital representation of every job available in the world — that would be full-time, temporary, for profit and volunteer” along with “a digital representation for every skill required to obtain one of those jobs offered by one of those companies.”
“When you combine Microsoft’s corporate graph with LinkedIn’s professional graph we think we’re going to be able to take a very substantial leap forward in terms of the realization of our vision, which is creating economic opportunity for every member of the global workforce, and we’re going to do that through the development of the world’s first economic graph,” said Weiner. “Just as we have changed the way the world connects to opportunity, this relationship with Microsoft, and the combination of their cloud and LinkedIn’s network, now gives us a chance to also change the way the world works,” Weiner said. “For the last 13 years, we’ve been uniquely positioned to connect professionals to make them more productive and successful, and I’m looking forward to leading our team through the next chapter of our story.”
“Based on the income statement and balance sheet, the numbers look high for an acquisition,” Patrick Moorhead of Moor Insight and Strategy said. “I see the potential for a beefed up business social media service which is more than a resume posting service as it is today. I can envision a service where businesses more freely collaborate, leveraging online versions of Office 365, Skype for business and OneDrive.”
Mark Vickery of D.M. Martins Research views the transaction as one that wraps sales and recruiting professionals within the Microsoft-LinkedIn product universe:
At an individual level, it starts with pre-professional networking and the job search, areas in which LinkedIn has been dominant as the leading professional network platform for a while now. But then it continues with professional development, through LinkedIn’s Lynda and, most importantly, with the integration of productivity tools, including Microsoft’s Office, SharePoint and Skype. A sales representative at Company XYZ, for example, who originally found his or her job through LinkedIn, could not only generate sales leads through the same platform, but also manage calendar (MS Office), meetings (Skype), and share documents (SharePoint) more seamlessly, provided that the many tools are properly integrated, without ever having to leave the Microsoft umbrella of products and services – all with a single sign on. In the end, the hypothetical salesperson could very well have an all-Microsoft experience in the office, from 9 a.m. to 5 p.m., and never have to seek (or encourage his or her employer to seek) workplace productivity solutions elsewhere.
Forbes contributor Grant Feller said that calling LinkedIn a social network would be akin to calling Google a search engine. Both descriptions are accurate but miss the true value of the firms. “LinkedIn is a content company. In effect, Microsoft has just bought one of the world’s most influential, specialised, highly read, constantly-updated (and, it must be said, occasionally annoying) digital media companies around,” said Feller. “The real value of the site is as a content-publishing platform in which key executives can expand their networks, their influence, their fame, their knowledge, their personas and their opportunities for a better-paid job by providing original content.”
Feller continued that while LinkedIn may at times be annoying or advertorial, LinkedIn produces much of its content. “It doesn’t just steal and redirect, though it does perform those acts admirably – it allows users to create material that intellectually nourishes.” However, Feller warned that Microsoft needs to protect LinkedIn from “a creep towards the banalities of Facebook” and improve the user experience.
Mitch Kapor, founder of Lotus Development Corp. and partner of venture firm Kapor Capital, noted that Microsoft has a mixed record with integrating acquisitions. “Sadly, history has shown [synergies] are very difficult to realize when two big companies combine, especially to the extent LinkedIn is remaining an independent fiefdom within the Microsoft empire.”
A general concern is that Microsoft is probably overpaying for LinkedIn. Some analysts also questioned the mixing of a non-profitable growth company with a slower growth cash flow company.
Moody’s has placed Microsoft’s ‘AAA’ credit rating under review as Microsoft will be issuing new debt.
Note: I hold no positions in Microsoft and LinkedIn and have no professional relationships with either firm.