Marc Benioff reminds Wall Street that ‘this isn’t my first recession,’ saying Salesforce’s activists ‘made a lot of money today’

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I wrote Tuesday that Marc Benioff faced the end of a not-so-happy era at Salesforce Inc., with Wall Street ganging up on the software company as layoffs hit employees.

Agreeing to an interview Wednesday afternoon, Benioff said it was “quite the spotlight”. He took the opportunity to remind me that I was the first reporter to write about Salesforce CRM,
When he asked Larry Ellison to leave his board in 2000And used that fact to make a point — that it’s dealt with more than one boom-and-bust cycle over the past 24 years, meaning this isn’t the first time it’s had to “reshape” Salesforce. .

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“This is not my first recession,” Benioff said in our phone interview, even as sliding into recession remains an uncertainty for the US economy.

“Every year we continually reinvent the company,” he told Marketwatch. “We’ve gone from zero to $35 billion, we’ve added a lot, we’ve lost a lot, we’ve reinvented in 24 years.” (Salesforce is projected to reach $35 billion in fiscal 2024 revenue.)

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Yesterday’s Column: Marc Benioff’s fairy tale is disintegrating in and around him

Benioff was chatty and seemed in good spirits as his stock soared toward its best day in more than two years, following a stellar earnings report and a forecast that showed Salesforce’s lower What can cost-cutting do for the line? As stock prices soar satisfied Wall Street, my concern wasn’t just for stocks: A markedly deteriorating workplace culture amid mass layoffs and investors active in stocks in an unprecedented way represented serious, twin threats. Are.

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Benioff dismissed any concerns about the workers, saying “they made a lot of money today,” and forcefully argued that Salesforce’s culture is “still very strong.”

“This culture of volunteering and giving is still very much alive and well,” Benioff said, noting that Hawaiian-shirt Fridays are still a thing at Salesforce, as is the 1-1-1 model. , which dedicates 1% equity, 1% product and 1% employee time to the community.

“It is also a performance culture – we also demand high performance to give back to the company [employee] performance,” he said, recently told wall street journal The employees pushed against a system for performance-based layoffs through a ranking system. “It’s our Ohana culture.”

“Our innovation,” he continued, “is very strong, [and] We are at record-low attrition with our customers. The company has never been stronger.

While Benioff has no plans to leave his position anytime soon — he said he still loves Salesforce and still prefers to be involved, even though he spends most of his time on airplanes — he pointed out that “I always have a strong successor, I always will.”

Benioff has named two co-CEOs in recent years, and neither managed to really take over from Benioff before leaving in a relatively short amount of time. The high-profile executive departure has fueled further questions about Salesforce’s trajectory. Co-CEO Brett Taylor was the latest to leave after just one year of sharing the top spot with Benioff.

More from Therese Poleti on Salesforce: Salesforce had better get used to Marc Benioff in charge, as it continues to pursue its handpicked successors

Too Amid layoffs, Salesforce is reportedly paying Matthew McConaughey more than $10 million a year

“Taylor has given up,” Benioff said Wednesday as his eyes lit up when he saw all the changes with the AI. “It will be something amazing,” he said Taylor’s plan to find an artificial-intelligence Company with former Google Vice President Clay Bower.

In Wednesday’s crucial post-earnings conference call, Benioff was joined by Chief Operating Officer Brian Milham and Chief Financial Officer Amy Weaver, who hold chair positions with the company. I mentioned that the structure was very similar to the one set up by Ellison, his mentor at Oracle Corporation (ORCL).

Oracle, where Benioff spent nearly a decade and a half, also at one point had two presidents, Mark Hurd and Safra Katz, who eventually became co-CEOs when Ellison became chairman. On the call with analysts, Benioff noted that he received a text from Ellison right after this latest earnings report, saying that Ellison had spent a lot of time “giving me the Oracle playbook.”

Benioff called Milham and Weaver “my top two execs” in our interview, but when asked specifically whether his current succession planning includes them, he said: “I haven’t talked about it.”

“They have separate roles,” Benioff said, “Amy is the CFO, and Brian is the COO. He manages all the distribution and go-to-market.

More on earnings news: Salesforce shares soar as Benioff says goal is to become ‘world’s most profitable software company’

When asked what was happening to the five activist investors who bought into his stock, Benioff told G.I. “We have been getting to know them over the past year,” said Mason Morphitt and ValueAct Capital. Morphit joined the Salesforce board this week, and Benioff said the ValueAct CEO is sharing a lot of tips and tricks with Salesforce — “probably what he learned at Microsoft MSFT,
Board” – for example, regarding delivery and pricing.

As far as other workers, Benioff said not every worker has enterprise-software expertise, but “we’re willing to listen to everyone.”

“I can learn from anyone and everyone. That’s what I do every single day,” he said, adding that he practices shoshin, the Zen Buddhist concept of a novice’s mind. “I try to keep a beginner’s mind.”

He indicated that, in his dealings with activists, it is productive to keep their ultimate goals in mind. “They’re investors, [and] They want to earn money.

“I think,” he said, as Salesforce’s shares soared in after-hours trading, “they made a lot of money today.”

In depth: ‘No one is immune’: Activist investors target tech companies after stock dive

That money will calm Wall Street for a while, but it doesn’t mean the storm is past on the home front.

MarketWatch asked whether there could be more layoffs after executives mentioned “short-term and long-term restructuring” on the conference call and several investment analysts raised the prospect of more cuts. Benioff would only reiterate that Salesforce has been redesigned every year and that the company’s culture of Ohana — which is the Hawaiian word for family — is still strong.

“As we get older, it’s more newsworthy when we make these changes,” he said.

Benioff still has the charm and flair to overcome current challenges, but if cost-cutting becomes the new norm as revenue growth slows, Salesforce risks developing into a company something more like the young Benioff. Escaped from chasing his own, separate dream.

Decades ago, I wrote about Benioff’s desire to separate from Oracle, and now it feels more and more like he’s following Ellison’s path.

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