Sprinklr’s $40M Series D round: what matters

The paid solution brings Sprinklr up to par with larger marketing clouds, but their latest lead investor and total amount raised are what’s most intriguing.

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).

Sprinklr competitive advantage
Sprinklr’s take on “depth of software integration” and how that leads to competitive advantage.

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.

Three Wildfire alternatives

Wildfire Evaluation Guide

I’ve spoken with two vendors this week that are experiencing an influx of inbound interest based on Wildfire’s impending shutdown.

I’m also discovering that not all buyers are ready to commit to the idea of a massive integrated social business platform.

If you find yourself in a position to explore Wildfire alternatives, here are a few choices to consider:

I did not find any public statements from Hootsuite, Adobe, Oracle, or Salesforce regarding Wildfire.

Endgame: Social Business Platforms

Three early social business platform leaders are emerging (Adobe, Oracle, Salesforce), while point solutions will continue to struggle and consolidate over 2014.

The news started trickling out late last week that Google is freezing support for social media management solution Wildfire in order to integrate more closely with DoubleClick. The company’s official statement says that they “won’t be building new features or signing up new customers” and current customers and competitors know what this means — there are suddenly dozens of brands and agencies looking for alternative social business platforms.

What U Choose Is What U Get - same goes for social business platforms

As an analyst at Constellation Research, I’m ramping up my marketing technology coverage and see a familiar pattern emerging as the social business software market matures. We’ve evolved well beyond the early days of the The Stack first identified by Jeremiah Owyang and now point solutions — which received all the early attention — are yielding to platforms.

My early take is that a “big three” have a headstart as the leading social business platforms:

  • Adobe (Marketing Cloud),
  • Oracle (Social Cloud), and
  • Salesforce (Marketing Cloud).

Each of the “big three” platforms acquired a standalone Social Media Management System (SMMS): Context Optional (now Adobe), Vitrue (now Oracle), and Buddy Media (now Salesforce), and Google + Wildfire, integrating with other social technologies to offer a multi-faceted value proposition. But buyer beware: websites and logos are easy to create; integrating multiple solutions to deliver a fully functioning unified platform takes a lot of time and effort.

Remaining standalone SMMS players have rebranded the space as Social Relationship Platforms (SRP) and include Spredfast, Hootsuite, Expion, and Sprinklr. Some have started to expand capabilities (e.g. Sprinklr has added listening and Expion has added advocacy) and some clients still want point solutions, but it’s clear that these players need to get big fast or find their way to an exit before they end up like Syncapse. It appears that they may be heading in that direction: as Forrester’s Nate Elliott recently found out, most SRP clients aren’t willing to recommend their vendor to a colleague.

In fact, I see SRPs on a path similar to brand monitoring providers. Their solutions gained a lot of attention in 2006 and I wrote the first Forrester Wave on these vendors. Here’s the current status of those original leaders:

  • Nielsen Buzzmetrics: went private, JV with McKinsey, shut down.
  • TNS Cymfony: acquired by Visible Technologies
  • Umbria: acquired by J.D. Power
  • Biz360: acquired by Attensity
  • Factiva: integrated into Dow Jones
  • Brandimensions: pivoted into anti-fraud
  • MotiveQuest: still standalone (!)

Even after rebranding as “listening platforms,” the market made clear that listening is a feature, not a product. Increasingly, publishing / social media management / social relationship management is turning out to also be a feature, not a product.

My take: the big three have the early lead in the competition to own the social business platform market, but we are in the early innings of the game. Standalone vendors will add features as rapidly as possible in order to stay competitive, and some categories originally thought to be independently viable — like enterprise social networks — will turn out to be nothing more than bundled feature sets as well.

I’ll write more to define social business platforms in upcoming weeks, including user case studies, vendor profiles, and technology evaluations. Stay tuned.

 


 

My take on the Sprinklr acquisition of Dachis Group

What a long, strange trip it’s been.

It’s a good fit; the core Dachis Group principles of social business design fit well with the Sprinklr concept of social experience management.

I’ll write more on the future later, but for now I’d like to take a look back. Over five and a half years, we built the world’s largest social business consultancy, completing six acquisitions, expanding to nine cities, and employing over 250 people. What a long, strange trip it’s been.

Dachis Group Come Together I

In July 2008, here’s what I wrote about what we were setting out to do:

Over the past two-and-a-half years I’ve been focusing on two major concepts: social computing and customer centricity. They fit very well together; becoming “socially successful” today requires that companies use process and technology to facilitate internal and external alignment. Your market is calling for this in a voice that gets louder every day. Unfortunately, many companies try to ignore what they’re hearing – and I see an opportunity in helping enterprises listen, learn, and take action.

Our yet-to-be-named firm will help companies and their new leaders unlock value from social computing within the enterprise, driving customer-centricity and effective engagement. The evidence of success will be found in culture and profit.

The core concept that resonated with our clients and drove the growth of our business was what we ended up calling “social business.”

The end game should be an entirely social business. Not just point solutions to improve existing processes or programs – new ways of connecting and collaborating. Business models will change. Customer-centricity becomes a moot concept, as “us” and “them” no longer exist.

We were successful in helping spark a global movement. In the beginning, we had to fight to win remnants of marketing and IT budgets. Today, businesses understand the need to shift into social business and have devoted hundreds of millions of dollars to prepare for the future. With the successful acquisition of Dachis Group, our part in the story of social business comes to a close and becomes part of a new emerging narrative.

I learned plenty of lessons along the way about myself and others. About SaaS and services. About winning business, retaining business, and losing business. About founders and employees. About hiring people and firing people. About VCs and bankers. About spending money and saving money. About acquiring and being acquired. I don’t have stories about private jets and private concerts, but I do have plenty of direct experience in helping companies engage their ecosystems and become better prepared for business success in the face of the information revolution.

Thank you to everyone who’s been part of the Dachis Group journey: our clients, employees, alumni, investors, business partners, and supporters-at-large.