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Salesforce (CRM) to Acquire Another Start-up Twin Prime
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Making a strong push toward enhancing its machine learning capabilities, the world’s leading CRM platform provider, salesforce.com, Inc. (CRM - Free Report) recently entered into a definitive agreement to acquire a tiny start-up called Twin Prime. The deal was announced through a blog by co-founder of Twin Prime, Kartik Chandrayana on the company’s website.
The financial terms of the deal haven’t been disclosed. However, according to Business Insider it won’t be a big amount as Salesforce has not filed an 8-K with the Securities and Exchange Commission.
Citing Pitchbook, which provides merger & acquisitions, private equity and venture capital database, the financial news agency also revealed that since its inception, Twin Prime has got a total funding of $11.5 million and was last valued at approximately $25 million.
About Twin Prime
Headquartered in California, Twin Prime was founded in 2011 by Chandrayana and Satish Raghunath. The start-up has developed a technology, which helps organizations in resolving the inherent volatility and diversity among devices and networks, thereby increasing their user engagement.
Chandrayana in his blog says that “We built Twin Prime with our outstanding team, bringing together mobile, networking and data science expertise. The result was a solution that leverages machine learning techniques to analyze real-time network data, identify and prioritize performance gaps in mobile apps, and then optimize mobile performance so companies can deliver content faster to any location, device and network. In collaboration with our customers and partners, we’ve been able to help solve mobile performance problems across almost every network and geography in the world.”
Further Push into Machine Learning
Machine learning is currently a hot trend in the tech space and several big technology companies like Facebook , Microsoft (MSFT - Free Report) and Alphabet (GOOGL - Free Report) are striving to grab a share of the pie either through acquisitions or in-house research.
In the last two years, Salesforce has been investing heavily to enhance its machine learning capabilities. The company took a major step in 2014 when it acquired RelateIQ, which specializes in making predictive tools.
Last year’s acquisitions of start-ups like Tempo and MinHash further enhanced the company’s AI capabilities. Moreover, this year, Salesforce took over two another start-up in the machine learning space, PredictionIO, which has developed an open source-based machine learning software and MetaMind, which is specialize in offering deep-learning services.
Bottom Line
Acquisitions have always been one of Salesforce’s key growth strategies. In the last one and half years, the company has closed a number of takeovers worth over $4 billion.
This year alone, the company has completed or is in the middle of as many as twelve acquisition deals. These also include its biggest ever buyout – Demandware – concluded this July.
The successful integration of Twin Prime should enable the company to concentrate more on its core business, translating into new products and a more focused sales team.
We believe that Salesforce’s sustained focus on expanding its business through strategic acquisitions and investments will drive growth over the long run.
However, continued weakness in Europe, currency headwinds and increased investments in research & development will keep margins under pressure.
Notably, Salesforce has underperformed the Zacks categorized Computer Software-Service industry on a year-to-date basis. The stock has lost 9.1% of its value in the year so far while the Computer Software-Service industry has gained 12.1% during the same time frame.
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Salesforce (CRM) to Acquire Another Start-up Twin Prime
Making a strong push toward enhancing its machine learning capabilities, the world’s leading CRM platform provider, salesforce.com, Inc. (CRM - Free Report) recently entered into a definitive agreement to acquire a tiny start-up called Twin Prime. The deal was announced through a blog by co-founder of Twin Prime, Kartik Chandrayana on the company’s website.
The financial terms of the deal haven’t been disclosed. However, according to Business Insider it won’t be a big amount as Salesforce has not filed an 8-K with the Securities and Exchange Commission.
Citing Pitchbook, which provides merger & acquisitions, private equity and venture capital database, the financial news agency also revealed that since its inception, Twin Prime has got a total funding of $11.5 million and was last valued at approximately $25 million.
About Twin Prime
Headquartered in California, Twin Prime was founded in 2011 by Chandrayana and Satish Raghunath. The start-up has developed a technology, which helps organizations in resolving the inherent volatility and diversity among devices and networks, thereby increasing their user engagement.
Chandrayana in his blog says that “We built Twin Prime with our outstanding team, bringing together mobile, networking and data science expertise. The result was a solution that leverages machine learning techniques to analyze real-time network data, identify and prioritize performance gaps in mobile apps, and then optimize mobile performance so companies can deliver content faster to any location, device and network. In collaboration with our customers and partners, we’ve been able to help solve mobile performance problems across almost every network and geography in the world.”
Further Push into Machine Learning
Machine learning is currently a hot trend in the tech space and several big technology companies like Facebook , Microsoft (MSFT - Free Report) and Alphabet (GOOGL - Free Report) are striving to grab a share of the pie either through acquisitions or in-house research.
In the last two years, Salesforce has been investing heavily to enhance its machine learning capabilities. The company took a major step in 2014 when it acquired RelateIQ, which specializes in making predictive tools.
Last year’s acquisitions of start-ups like Tempo and MinHash further enhanced the company’s AI capabilities. Moreover, this year, Salesforce took over two another start-up in the machine learning space, PredictionIO, which has developed an open source-based machine learning software and MetaMind, which is specialize in offering deep-learning services.
Bottom Line
Acquisitions have always been one of Salesforce’s key growth strategies. In the last one and half years, the company has closed a number of takeovers worth over $4 billion.
This year alone, the company has completed or is in the middle of as many as twelve acquisition deals. These also include its biggest ever buyout – Demandware – concluded this July.
The successful integration of Twin Prime should enable the company to concentrate more on its core business, translating into new products and a more focused sales team.
We believe that Salesforce’s sustained focus on expanding its business through strategic acquisitions and investments will drive growth over the long run.
However, continued weakness in Europe, currency headwinds and increased investments in research & development will keep margins under pressure.
Notably, Salesforce has underperformed the Zacks categorized Computer Software-Service industry on a year-to-date basis. The stock has lost 9.1% of its value in the year so far while the Computer Software-Service industry has gained 12.1% during the same time frame.
Currently, Salesforce has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Zacks' Top Investment Ideas for Long-Term Profit
How would you like to see our best recommendations to help you find today’s most promising long-term stocks? Starting now, you can look inside our portfolios featuring stocks under $10, income stocks, value investments and more. These picks, which have double and triple-digit profit potential, are rarely available to the public. But you can see them now. Click here >>