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Strategies & Market Trends : Gorilla and King Portfolio Candidates -- Ignore unavailable to you. Want to Upgrade?

To: stockman_scott who wrote (18065)	2/15/2000 10:55:00 PM
From: Mike Buckley	Read Replies (2) \| Respond to of 54805

Scott, Mike: Siebel's new competitor (Salesforce.com) is one to watch, IMO.... For the same reasons I didn't get excited about Siebel's strategy regarding Sales.com nor its ultimate spin-off, I am not excited about Salesforce.com. The two dot coms compete with each other but neither attempt to compete with Siebel in a meaningful way. To compare Salesforce.com or Sales.com to Siebel doesn't pass the laugh test for me. 'Our objective is to put Siebel Systems out of business,' Benioff says flatly. I don't remember seeing or hearing of anything in any of Moore's books about the viability of a tactic to put a company out of business. That comment doesn't speak any better of him than Siebel's and Ellison's trading of public barbs speaks of them. In that sense, the three of them deserve each other. What is it about these ex- and present Oracle guys? And if Benioff is out to put Siebel out of business, he's apparently trying to shut down Oracle's CRM initiatives. I'm reasonably confident that Larry Ellison or Oracle or both are among Salesforce.com's investors. The company is about to close another round of financing that will bring its total funding to $52 million and value it at $350 million. Siebel Systems has $663 million in cash and short-term investments, never used (needed) venture capital, has more partners than Saleforce.com has customers, and has one customer (IBM) whose eventual implementation has been valued in the range of "tens of millions of dollars." ...instead of buying expensive packages of software, even large companies will pay monthly fees to get what they need from Web sites like his. They're already doing that. One of the big surprises to the management team of USinternetworking, the leading player in the very new entry of ASPs that host enterprise-wide software (including Siebel's) for a monthly fee is that some of the Fortune 500 companies are their customers when they originally thought only the small- and medium-size companies would find the model especially attractive. But don't confuse the distribution model with the content. Remember that the author's analogy of the ant has nothing to do with the sting of its bite; it's used because the ant hopes at best to scavenge the crumbs left by the picnicers. Everything we know about the history of Gorilla Gaming tells us that Salesforce.com will never replace Siebel as the Gorilla, much less put the company out of business. Hope this helps explain why I don't share your view that Salesforce.com is a competitor. I do believe it's worth closely watching, but only in the context of a Gorilla Game for sales force automation of small businesses and individual salespeople. --Mike Buckley