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Salesforce buys word processing app Quip for $750M
- epall 10y agoAccording to CrunchBase, they've only raised $45M. 16x return after 4 years in business. Well done! https://www.crunchbase.com/organization/quip#/entity https://www.crunchbase.com/organization/quip#/entity
- minimaxir 10y agoIt's worth nothing that Mark Benioff invested in the original 2013 Venture round.
- deleted 10y ago[deleted]
- kartD 10y agoIncorrect on the return front. $45M buys a percentage of the company. According to this post (https://www.quora.com/At-what-valuation-did-Quip-raise-their-30M-Series-B https://www.quora.com/At-what-valuation-did-Quip-raise-their...), Quip's last valuation was ~$376M, so a return of 2X.
- joshu 10y agoYou probably should learn how venture capital works.
- jlgaddis 10y agocf. https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html
- swivelmaster 10y agoI don't understand this valuation. I've only used Quip a bit but it doesn't seem like an amazing piece of software. Do they have a massive user base? Did they do a fantastic job at enterprise sales? Do they have a lot of recurring revenue?
- atonse 10y agoThey've got an all-star team and their product looked pretty awesome to me, although I haven't used it. What I'm more curious about is whether they integrate with Salesforce? Where do they make sense under the salesforce umbrella?
- tlogan 10y agoRegarding Salesforce - they have really trouble with notes and things like that. Quip make sense: if nothing to replace crappy Salesforce notes section with Quip and people using Salesforce will be a little happier. The price tag of $750M is a little too much for me but I'm anyway not verse in these kind of deals (and I was under impression that Quip is in trouble since I haven't see a lot of people using it).
- newman314 10y agoQuip is great for notes.
- ktamura 10y agoThis makes sense. 1. Talent: As others say, an all star team. I've interacted with some of them as a vendor (Quip is our customer) and know a couple of them as friends of friends, and they have a rockstar team. 2. Integration: This is going to add collaborative document sharing to Salesforce's product line. Much like the Chatter acquisition to beef up their "collaborative, connected customers" story. 3. DATA: Essentially, Quip's metadata is the intra-organization graph of who collaborates with who. While Salesforce needs to be careful how they are going to use it (and definitely need to create the technical infrastructure to take advantage of this data), this is a deep well of customer knowledge that they can parlay into selling other Salesforce products.
- zaidf 10y agoThis is an acquisition to get Bret Taylor. I'd expect Salesforce to put him in charge of slowly improving the core salesforce tech stack.
- confiscate 10y agoDoesn't seem like a acqui-hire. Is it really worth hundreds of millions to buy someone?
- theGimp 10y agoSome individuals, yes. CEOs are often paid hundreds of millions of dollars, and some VP-level executives at big companies are also worth that kind of money.
- JupiterMoon 10y agoIs paid really the same as worth?
- confiscate 10y agoWhat really? I thought CEOs are paid millions, not hundreds-of-millions. I mean, if they stay at the company for decades, sure it can add up to hundreds-of-millions. But upfront? Sounds like a lot!
- rch 10y agoNot saying it happened in the case of Quip, but last year Google effectively paid $380M for Diane Greene: https://techcrunch.com/2015/11/19/google-buys-bebop-and-names-diane-greene-to-lead-enterprise-cloud-effort/ https://techcrunch.com/2015/11/19/google-buys-bebop-and-name...
- confiscate 10y agoOh interesting. Nice info.
- ALee 10y agoI'm guessing this means that Bret Terrill will be taking a bigger role working with Twitter, given that he just joined their board as well.
- randall 10y agoI hope the product continues to grow at Salesforce. I love it and it runs our business. I need it to get some of slack's integration features and it'll be perfect.
- dmix 10y agoQuip talked about how many users they had in a Recode article from Oct 2015 [1]: > Taylor said Quip has millions of individual users and 30,000 business customers, though not all of those are paying. So to do some back of a napkin math if they had 15,000 paying customers (50% of their noted business userbase) how much would they make in revenue? I've distributed the numbers across different levels of SaaS monthly bills because most customers will pay for the cheaper packages. 75% (11250 customers) * 5x users = $30/m = $337,500/month 15% (2250 customers) * 7x users = $50/m = $112,500/month 10% (1500 customers) * 10x users = $70/m = $105,000/month 5% (750 customers) * 25x users = $230/m = $172,500/month Estimated Revenue: $727,500/month or $8,730,000/year (these buckets of average users could be much much bigger (100's of users) on the higher end if they have enterprise customers but I'm being purposefully modest) [1] http://www.recode.net/2015/10/15/11619612/bret-taylors-quip-lands-30-million-to-take-on-office-google-docs http://www.recode.net/2015/10/15/11619612/bret-taylors-quip-...
- smt88 10y agoI see I'm not the only one who's never heard of Quip. It seems hard to believe they have so much traction and aren't an HN-household name...
- Keyframe 10y agoCould be money laundering / funneling scheme too. Someone mentioned Salesforce CEO having a stake in that company.
- ubernostrum 10y agoIt seems hard to believe they have so much traction and aren't an HN-household name... I would suggest that, perhaps, "HN household names" and "things lots of people actually use" are not particularly strongly correlated.
- smt88 10y agoI strongly disagree when there are "millions" of users, and the product in question is a web-software startup. The early adopters of these products are very likely to be small, tech-savvy businesses, which is definitely one of the core HN audiences. Not to mention a lot of us just follow software startup news in general...
- dajohnson89 10y agoWhat are the odds of Microsoft buying Salesforce?
- apapli 10y agoNot sure why you were down voted. I'd say they are becoming lower by the day. Microsoft have announced Dynamics365 and I suspect they will double down on competing with Salesforce now. Particularly now that Salesforce are competing against office365 with quip. Salesforce only have a CRM, and even though it is popular they don't offer ERP, financials or any productivity tools. I think they got greedy when they rejected Microsoft. With oracle buying netsuite (super charging their product dev funds) I think Salesforce will be in a bit of a pickle in a few years time, as they simply won't be able to offer an integrated package to the same level of depth their competitors do.
- snuxoll 10y agoMicrosoft has a long way to go before they can start cannibalizing Salesforce, Dynamics has some perks but customizing it sucks. I managed to start a Salesforce trial, implement a couple custom apps in 48-hours (albiet, with knowledge of Salesforce before hand from my previous job) and within a month got the green-light to roll it out to the ~8 person team in our company that desperately needed a proper CRM to replace the access DB they were using + a couple LOB applications. 80% of this was point-and-click work I could have given to one of our Jr developers if I wasn't scrambling to get a POC ready on the side, and, in fact, most of the day-to-day work on our Salesforce org is done by one of our Jr. devs today. My experience with customizing Dynamics is extremely poor, I'm a C# developer but the thought of touching that gives me horrors equating to Sharepoint. I don't have any experience with NetSuite, so I won't say anything about it. Regardless, as long as Salesforce keeps being a great platform for quickly hammering out LOB apps I don't see it going anywhere, our parent company is heavily invested in it and we have doubled our licenses over the past year and are looking at upgrading most of them from the "App Cloud" licenses to full "Service Cloud" licenses to take advantage of the case-management functionality so our teams can have everything under one roof instead of having to go back and forth between email, zendesk, and Salesforce.
- pmarreck 10y agoThere needs to be a thread on "newish online tools that everyone is starting to depend on or love" because I had never even heard of this domain/product until this news. Apparently, neither did the Quip toothbrush people. How is Quip better than good old Google Docs? EDIT: Just looking at it, it looks very reminiscent of Apache Wave, which I was (unfortunately) a fan of. I wonder if it was inspired by it? EDIT 2: It seems that Quip, unlike Google Docs, is end to end encrypted, which makes it possible to use on corporate intranets that normally forbid tools like Google Docs for security reasons. Hrm. EDIT 3: Might as well plug the newest thing _I_'ve heard of. https://discordapp.com/ https://discordapp.com/ is a great voice chat client, intended for gaming but surely useful for productive ends. It's Erlang-backed, as well. Seems to have great connection quality and is just a nice, fun app.
- johns 10y agoThat's basically Product Hunt
- pmarreck 10y agoFair enough, I don't visit that site enough.
- willcodeforfoo 10y agoI'd like something that doesn't show apps when they are brand new, but features ones that stand the test of (a little bit of) time and have proven useful beyond the initial launch phase. Maybe it's just me getting older...
- GFischer 10y agoProduct Gather ? :) Seriously, there are several sites that review apps, actually way too many of them. One I've found myself using a few times is StackShare - http://stackshare.io/ http://stackshare.io/ . It's lacking ot the "review" side though.
- deleted 10y ago[deleted]
- louprado 10y agoMark Benioff, Sales Force CEO, personally invested in the original venture round that raised $15M [1]. Assuming that round set a $75M valuation, it implies M.Benioff made at least a 10X with this investment. I'd assume boards are diligent when it comes to potential conflicts of interest and the $750M valuation is justifiable. But I don't know that for a fact. Does anyone have insight on how boards deal might deal with this scenario ? [1] https://www.crunchbase.com/organization/quip/investors https://www.crunchbase.com/organization/quip/investors edit: grammar
- swampthing 10y agoUsually, you would have the transaction approved (or rejected) by the disinterested members of the board (i.e. the directors with no conflicts of interest).
- acchow 10y agoSuppose the conflicted interest on the board has majority share - would they still sit out on the vote?
- Retric 10y agoNot sitting out opens you up to lawsuits. But, a lot of sketchy crap goes on.
- andrewfong 10y agoYes, what they're looking for is a majority (or 2/3 or whatever threshold is called for in the bylaws) of the disinterested directors. If there are no disinterested directors, or it's something like 5 out of 6 directors are conflicted and the 1 director isn't comfortable going it alone, then the company might ask for approval of a majority of the non-conflicted shareholders. This isn't strictly required I think, but it's considered the safe thing to do.
- dyim 10y agoYup, something similar happened with the Tesla/SolarCity acquisition: "Mr. Musk said Monday he wasn’t involved in the decision making about the valuation of the purchase." [1] [1] http://www.wsj.com/articles/tesla-and-solarcity-agree-to-2-6-billion-merger-deal-1470050724 http://www.wsj.com/articles/tesla-and-solarcity-agree-to-2-6...
- deleted 10y ago[deleted]
- k__ 10y agoHave to use it on a daily basis and coming from libre office, it feels really weak. Especially the table calculations are not good. They got a bit better in the last months, but still feel like a toy :/
- duaneb 10y agoLiber office has virtually no realtime collaboration, no mobile, and no web app. It's apples and oranges. Libre office is still going to be better for writing long form, and quip is for pairing (a)sync review and ACL management. It is difficult to see the role of libre office (or any native only app) in the enterprise for much longer.
- beat 10y agoThinking about this just in terms of product... There are two real competitors on the market - MS Office, and Google Docs. Office is where it is today through sheer inertia. It's a slow-moving and often terrible product. Google Docs feels like a "free product", with a lot of limitations. The market feels like someone could "Slack" it - walk in with a good enough product and just lay waste to the incumbents very quickly. The shift to cloud-based tools is happening rapidly, pushed by the ubiquity and quality of mobile devices. Salesforce practically invented this market, and they have incredibly deep hooks into the enterprise (and lucrative enterprise licensing agreements). MS Office feels like a clunky antique hobbling users to their clunky old PCs, but Google Docs isn't going to satisfy the corporate power users who are amazingly productive with Word, Excel, and Powerpoint. Mark Benioff is ambitious. This isn't about his RoI for some A round investment. He's already a billionaire. More money is just bouncing the rubble. What's important is he built a company, Salesforce, at the top of the second tier of the software industry. It's important enough to have shaped the industry, and make billions - but it's not Google. It's not Apple. It's not Oracle. And it's not Microsoft. If he wants to break into that tier, he needs to level the company up. Taking over the enterprise productivity app market and consigning Microsoft to the dust bin of history? That might just do it. And finally... like all large companies, Salesforce may be facing market saturation and a tapering off of growth. It's too big to easily develop breakthrough products in house anymore. Instead, there's growth through acquisition, buying hot startups with the ample buckets of cash you have, to break into new markets. So maybe, just maybe, this buyout is exactly what it looks like.
- justincormack 10y agoGoogle seemed to decide to stop investing (they bought docs didn't they? But improved for a while). Sun in an earlier era did the same with open office but gave up, mostly. Seeing sustained investment would be good, but there is huge legacy in office software. The real disruption we see is markdown and git, but there might be an intermediate in usability. (Microsoft are doing pretty well at not leaking revenue)
- duaneb 10y agoThe killer is sharing via a web browser. No word needed ever.
- thepumpkin1979 10y agoQuip is amazing, I started using it last year when they published a blog post documenting how they build their native Mac app app using a mix of React+cpp[0] and been using it since then, not without issues though [1][2]. [0] https://medium.com/@btaylor/react-with-c-building-the-quip-mac-and-windows-apps-c63155c1531b#.wuw1fnun7 https://medium.com/@btaylor/react-with-c-building-the-quip-m... [1] https://twitter.com/bithavoc/status/750419283797237761 https://twitter.com/bithavoc/status/750419283797237761 [2] https://twitter.com/bithavoc/status/760231521211080704 https://twitter.com/bithavoc/status/760231521211080704
- surfmike 10y agoFor those who haven't heard of Quip: one interesting data point is that Facebook uses it internally, since they don't use any Google products. I'm sure countless other companies use it too.
- screature2 10y agoSeems that Facebook makes extensive use of Quip internally even though it's doing the whole Office 360 subscription doohickey. "An interesting side-note, though: While this deal means Microsoft will use Office 365 for e-mail and calendaring, they probably won't get much use out of Microsoft Word — Facebook uses Quip, a mobile word processor developed by former CTO and current Twitter board member Bret Taylor, for word processing." http://finance.yahoo.com/news/top-facebook-exec-microsoft-got-144500200.html http://finance.yahoo.com/news/top-facebook-exec-microsoft-go... See also embedded tweet.
- yalogin 10y agoThis is a such a big company but I have never heard of it till now.
- Animats 10y agoMicroPro, the company behind Wordstar, was the dominant word processing company in 1984. They were the largest software company in the world at the time, with about 25% of the industry. They went public in 1984 for a market cap of $165M. That's $482M in 2016 dollars. What makes this word processor worth $750M?
- frankchn 10y agoFor one, the market is a lot bigger. Only 8.2% of all US households had a computer at all in 1984, and only 18.3% of adults aged 18 or above had reported that they used a computer somewhere (either in school, at work or at home) [1]. [1]: https://www.census.gov/hhes/computer/files/1984/p23-155.pdf https://www.census.gov/hhes/computer/files/1984/p23-155.pdf
- Animats 10y agoBut the prices for apps are a lot lower.
- Trundle 10y agoIn the enterprise market?
- frankchn 10y agoNot necessarily. A copy of Microsoft Office Home & Student 2016 is still $150, and Google Apps for work is still $5 or $10 per user per month. Heck, Slack is $6.67 or $12.50 per month per user.
- Animats 10y agoMicrosoft Office was $499 to $999 in 2000.[1] And that was promotional pricing. [1] https://news.microsoft.com/1999/01/07/microsoft-announces-office-2000-pricing-and-prelaunch-promotions-2/ https://news.microsoft.com/1999/01/07/microsoft-announces-of...
- deleted 10y ago
- askafriend 10y agoI'm honestly surprised so many people on HN haven't heard of Quip. I mean Bret Taylor is a pretty big name, and we've all known that he was working on Quip for a while. There are a bunch of Bay Area companies that use Quip and the Quip team made a big deal about the future of mobile word processing when they first came out. I'd be less surprised if the general public was unaware, but interesting to see the surprise come from the HN crowd.
- pavlov 10y agoThe HN title is misleading because Quip isn't really a word processing app. It's more like the combination of Google Docs and Slack: realtime documents and chat seamlessly linked.
- luckydata 10y agoQuip is a turd, a common investor of my past startup pushed me hard to try it and I didn't like it one bit. I never understood the hype.
- sjg007 10y agoMan.. I was wondering who would take google wave to the next level. Wished I had even heard about this company 2 years ago.
- betolink 10y ago$750M for a word processing app? Go home Silicon Valley you're drunk!
- wNk6A23YB 10y agoHopefully this investment will help the guy reach the finish line even though his extremities are all controlled by different keys on the keyboard.
- frik 10y agoIf we speak about Quip as word processor with collaboration and chat capability. You get almost the same word processor capabilities with Etherpad (+ plugins) - sure less polished - for free, open source: http://etherpad.org/ http://etherpad.org/ (its root go back to Google Wave)
- Jack_32 10y agoIt seems SF got the fear because of Google and ZOHO. SF cant beat Google or ZOHO where they have deep and broad portfolio..