- Salesforce is a 19-year-old cloud software company worth $85 billion today.
- But no venture capitalists would invest in the company when it launched, Marc Benioff and Parker Harris told Business Insider’s Julie Bort during an on-stage interview last week.
- The company’s early hardships never caused Benioff to lose faith in his vision for his company — but it did help him refine his personal philosophy.
- He shared four tips for how anyone can be successful even when the world says it’s impossible.
Salesforce, a 19-year-old cloud software company worth $85 billion that has 30,000 employees, brought in $10 billion last year and hopes to have $60 billion in revenue by 2034.
But success in Salesforce’s early days was hardly a given, its founders, Marc Benioff and Parker Harris, told me during an on-stage interview last week at TrailheaDX, Salesforce’s developer conference in San Francisco.
Salesforce launched in 1999, at the height of the internet bubble. About a year later, that bubble burst, and the “dot-com” startups — companies founded to sell stuff online — found themselves running out of money with nowhere to turn.
“If you look at our history, it looks amazing, but there were some hard times,” Harris said. “There was a lot of work; it wasn’t all easy.”
He famously tells a story about those early days when a venture capitalist walked by his wife as she was pushing a stroller up the steep streets of San Francisco and shouted over his shoulder at her: “Salesforce is never going to make it!”
Salesforce provides software over the internet through a monthly or annual subscription. That model sounds normal today, but in 1999, the internet wasn’t very fast, safe, or reliable. Very few companies were ready to rely on it for the software they needed to run their businesses.
Benioff says such things never worried him.
“I have a lot of faith,” he said, which gave him “the ability to believe in Salesforce before there was Salesforce.”
Benioff was never able to convince a VC to invest
The founders launched Salesforce in Benioff’s San Francisco apartment, and Benioff dug into his savings to pay the bills.
He had worked at Oracle, bringing in a $1 million salary. But that only took him so far. He would soon need to raise more money.
So he put together his business plan and his slide deck.
“I go from venture capitalist to venture capitalist to venture capitalist — and a lot of them are my friends, people I had been going to lunch with, whatever — and each and every one of them said no,” he said. “That’s why Salesforce was never able to raise a single dollar from a venture capitalist.”
They turned him down because they didn’t believe Salesforce was a good idea, or that the cloud would ever be a thing. And apparently there were some politics too.
“There was a competitor who had called these venture capitalists after I would be there and say, ‘Don’t invest in that company,'” Benioff said. “That was an amazing phenomenon.”
He didn’t mention who that competitor was, but the biggie back in those days was a company called Siebel Systems, which Oracle later acquired.
A chance meeting at the airport that changes everything
An airport meeting with Pat McGovern caused Benioff to change tactics.
McGovern, the founder of International Data Group — which publishes computer trade magazines like Computerworld, PCWorld, and Network World — had been doing a lot of investing in those days, mostly in China.
The two men talked before boarding the plane. Benioff described his new company as “the next level of software,” and McGovern agreed to invest on the spot, Benioff said.
He went on to raise $62 million, all from private investors — people he met and talked to and “believed in us,” he said.
“It took us about $55 million before we went cash flow positive,” Benioff said.
4 tips for success
What Benioff learned from those early hardships, as well as other struggles over the years, boils down to a few things:
- Get “really clear” about what you want. Benioff says the times he struggles the most are when he’s not sure what he wants.
- Set a positive intention for what you want. Have faith that there is a path between where you are and what you want — you just need to see it and recognize it. Make sure you’re focusing on what you to create (the positive outcome) and not what you want to avoid (the feared outcome).
- Pay attention to what comes your way. Benioff says that after setting an intention, “I just notice that things start to show up in my reality to help me create my future.” That might sound like metaphysical hooey — Benioff is into meditation and hanging out with Buddhist monks — but in a practical sense, if you focus on what you want, you will start to recognize people, things, and ideas that can help you. Then you will begin to see the steps you need to take to get there, letting you more easily dismiss distractions and fears.
- Most importantly, build a support network. “Surround yourself with people who do believe in you, who do believe you’re going to be successful,” Benioff said, “because you’re going to have a whole bunch of people who are going to tell you that you’re not.”
As for the VC who snarked at Harris’ wife, Harris says: “I don’t know what he’s doing today, but we’re doing all right.”