A couple of days ago Zendesk, the recently IPO'd vendor of help desk and customer support software, announced that it is acquiring French analytics vendor BIME Analytics for $45 million in cash. BIME is (was) and early stage startup with the majority of its team based in Montpellier. As such, it is something of an unusual acquisition -- while Zendesk was founded in Europe itself (Copenhagen, precisely) newly listed companies have a tendency to look to Silicon Valley for M&A opportunities.
But this is one deal that is interesting for another reason. Zendesk is one of a small band of software-as-a-service (SaaS) companies all founded in the mid-to-late 2000's. Along with other vendors such as NewRelic and GoodData, Zendesk was an early proponent of business-development-by integration. Indeed, at one stage it seemed Zendesk was announcing new product integrations on a weekly basis. But the relationship that Zendesk had with NewRelic and GoodData, in particular, went beyond simple integrations, this triumvirate was always held up as the most substantive of this cohort of companies, and the three heavily leveraged each other's platforms, marketing budgets and parties for mutual gain.
But there's the rub -- GoodData and BIME Analytics are somewhat competitive. While GoodData is far more advanced than BIME is, the two essentially play in the same space: SaaS delivery of real-time business analytics. In BIME's case, it provides a large number of data connectors to enable the aggregation of data from a number of different source -- Bigquery, CSV, Excel, Intercom, Google Analytics,and Salesforce for example.
Which, coincidentally (or not) is pretty much what GoodData does. So the question here is whether we're seeing a fracturing in the formerly close relationship between some of these players. As Zendesk, now a publicly listed company and hence in need of constant growth, strives for additional revenue, is it inclined to eat the lunch of its former partners? And, while this isn't a massive deal in industry terms, for Zendesk, with reported $130 million in revenue last year, it constitutes a third of annual revenue -- not a small undertaking.
According to the press release announcing the deal, BIME CEO Rachel Delacour and CTO Nicolas Raspal will keep working on BIME for Zendesk. Zendesk will use BIME’s product to promote a "data-driven approach to customer support." As for existing BIME customers, Zendesk will continue to develop, sell and support its product.
I reached out to Zendesk to ask the obvious question about what this means for the relationship between the company and GoodData. Matt Hicks, VP of corporate marketing and communications had this to say;
"GoodData is an important and valuable partner that helped us build great reporting features for our customers. We plan to continue to work together. Our customers will not see any immediate changes in those great reporting features." Hicks continued saying that, "Over time, customers will see BIME Analytics powering more of the analytics across Zendesk products and adding additional capabilities for reporting on customer data stored in external sources."
Maybe this is just the reality of a technology company looking for growth, but it stirkes me that the happy little Nirvana that the SaaS class of the 2000's created, isn't quite so happy anymore.
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