This morning, Sprinklr made a two part announcement.
1) The availability of an integrated paid social media solution.
This capability allows Sprinklr clients to manage owned media (publishing), earned media (via listening/engagement), and now paid media (social advertising).
Sprinklr will claim competitive advantage in offering a single integrated data model vs. apps in parallel (Adobe), UX overlay (Salesforce), or API partners (Oracle).
In theory, tighter integration can offer more powerful data analysis capabilities. In practice, Sprinklr cites an unnamed client that saw a 25% lift in paid social ad performance from using the module.
My take:
The “big three” marketing clouds already offer paid social ad creation, placement, measurement, and optimization: Adobe’s Media Optimizer, Salesforce’s Social.com, and Oracle via API partners Kenshoo, Nanigans, and SHIFT. This added capability brings Sprinklr up to par with bigger players in social media management functionality and just in time as paid social gains increasing priority in the paid/earned/owned media landscape.
2) A $40 million Series D financing round led by Iconiq Capital
This round brings Sprinklr’s total capital raised to $77.5 million. Sprinklr’s previous three funding rounds only had two participants: Battery Ventures and Intel Capital. But Iconiq Capital isn’t a venture capital company; it’s a registered investment advisor (RIA).
My take:
This is an interesting lead investor, especially for the social media space in which Sprinklr currently operates. Unlike VC funds that typically get passive investments from pension funds and insurance companies, Iconiq handles the private, personal investments of individual clients including Mark Zuckerberg, Sheryl Sandberg, and Sean Parker, among others. Investors like to smooth the road ahead for their investment vehicles and those are three pretty powerful operators to have on your side.
Sprinklr tells me that they intend to use the round for “growth.” This can only mean organic expansion, because the round isn’t big enough to start acquiring pieces to build a complete marketing cloud (e.g. a marketing automation solution).
What Sprinklr’s annoucement means
Valuations typically aren’t disclosed, but Sprinklr undoubtedly has its sights set on joining The Unicorn Club and potentially filing for an IPO between now and 2015. The alternate route would require a bigger player stepping in to acquire Sprinklr, which is becoming an increasingly expensive proposition (but still no big deal for the deep pockets of an IBM, SAP, or Microsoft). Sprinklr’s preference would appear to be the former, as it has shown an inclination to build (e.g. listening and paid social) rather than buy (the exception being Dachis Group which provided some code and mostly developers).
Bigger vendors must evaluate the growing threat that Sprinklr poses to the early market-leading clouds. Smaller vendors need to bulk up or get bought out soon, before going the way of Argyle Social. Clients/end-users need to evaluate their marketing technology stack and decide whether running a collection of best-in-breed point solutions still makes sense or if committing to a larger integrated cloud now will pay bigger future dividends.