Q&A: Salesforce Ventures’ Alex Kayyal on the New $125 Million Europe Trailblazer Fund
Salesforce Ventures has announced a new $125 million Europe Trailblazer Fund to invest in the best European enterprise technology startups and seed innovation in the region, expanding the Salesforce ecosystem and driving customer success. The new Trailblazer Fund launches as startups in Europehave more opportunities to become thriving businesses.
Over the last decade, Salesforce Ventures has invested in the growth of more than 300 enterprise technology companies, across 20 countries. In the past year, Salesforce Ventures has also announced regional funds focused on Canada, Japan, and Australia, as well as a previous fund launched in Europe in 2015. With these funds, Salesforce Ventures deepens its commitment to creating the world’s largest ecosystem of enterprise cloud companies to fuel customer success.
In this interview, Alex Kayyal, partner and head of Europe at Salesforce Ventures, discusses why startup opportunities in Europe are more optimal than ever, and what makes Salesforce Ventures unique.
Please tell us about your background. How did you start working in venture capital and what brought you to Salesforce?
My path to venture capital started with a brief stint as an entrepreneur. I left my private equity job and decided to launch a business, and in that process met a variety of VCs. I have always been passionate about technology and loved investing, but that was my first real exposure to the world of venture capital and I’ve been hooked ever since. After my startup days, I ended up helping launch a venture growth firm with the former CEO of Telefonica where we invested in enterprise SaaS and fintech companies across the US and Europe.
I was connected with Salesforce more than five years ago and was quickly attracted to the company out of an admiration for the business. It’s incredible to see what Salesforce has accomplished over the last 20 years, particularly with the values of the company, the culture and the incredible innovation. When I had the opportunity to come to Salesforce to build the venture program in Europe, it felt like too good of an opportunity to pass up.
What is your current role at Salesforce Ventures?
I’m a partner on the team and lead our investments across Europe. I am lucky to work with a really amazing team, including folks like John Somorjai (EVP, Corporate Development & Salesforce Ventures) and Matt Garratt (Managing Partner at Salesforce Ventures) who have been instrumental in building our venture program globally. What we focus on is simple. We’re looking to back the best enterprise B2B companies globally, particularly those that are strategically aligned with Salesforce so our customers get access to even more innovation to drive their success. Our aim is to accelerate the growth of the companies we invest in above and beyond just providing capital.
I genuinely believe that I have the best job in the world. I spend my days meeting really ambitious entrepreneurs and reimagining the future of the enterprise with them.
Last year, Salesforce Ventures was the most active Corporate VC in Europe, according to Pitchbook. What do you think makes Salesforce Ventures unique in the VC world?
First of all, I think we’re seeing incredible innovation coming out of Europe and the startup ecosystem continues to mature. I’ve been in Europe on and off for over 10 years and the scale and growth of the ecosystem today are really unprecedented. Ten years ago, far fewer companies were getting started, especially enterprise-based ones. In terms of access to funding, expert networks, and real know-how, businesses are having an easier time getting started and scaling.
At the same time, Salesforce has had phenomenal growth in Europe, and that makes startups keen to work with us. According to IDC, we grew faster last year than any other top 10 CRM vendor in EMEA, and we have the highest market share in CRM in EMEA.
Coupling this tremendous ecosystem growth with our unique investment model enabled us to build a portfolio that we are incredibly proud of. We are really focused on building the best ecosystem of B2B enterprise technology startups, and so we often partner with the best VC funds in the region as co-investors. Our goal is to add value to the company and be complementary to a financing round.
Those are some of the main factors that have led us to be so active in the market, and we’re looking forward to continuing that growth and momentum with the announcement of this new fund.
What are some examples of the most exciting enterprise technologies you’ve invested in since you’ve been at Salesforce?
One thing that stands out is the sheer range of companies we’ve invested in. When I look at the types of companies we’ve backed in the last few years, they really span the gamut. For example, we’re investors in a company in the U.K. called Privitar. They’re a leading privacy engineering solution that allows any enterprise to make use of sensitive data in a private, secure way. Trust is our number one value at Salesforce. We’ve been really impressed by Privatar’s approach to helping enterprises address the privacy challenges that come with running data analytics across some of the most sensitive data within a company.
In Israel, we’ve invested in a company called Bringg which offers leading retailers software that enables smart delivery and logistics. I think many consumers have had the experience of ordering something and having it delivered quickly and efficiently. What Bringg does is empower companies all over the world that want to offer that kind of incredible user experience.
As a third example, we’ve backed Unbabel, which is a leading machine-based language translation business. They help businesses engage with their customers seamlessly in languages spoken all around the world.
What are you most excited about in terms of the European investment landscape today? And, where do you see it going in the next few years?
I think the level of sophistication we’re seeing in Europe has totally evolved. Today, we have all the ingredients for making Europe one of the most exciting places to start a company. For the first time we’re seeing companies that are valued at over $5 billion, $10 billion, even $20 billion coming out of Europe. As an example, Anaplan, a company that actually got started in the U.K., and which we are investors in, recently had a very successful IPO.
In the past it was common for companies to be predominantly local businesses that started and stayed in their own domestic market. Now we’re seeing more European businesses branch out globally, driving growth. Importantly, entrepreneurs have concrete examples now of successful businesses that have scaled out of Europe and built category-defining companies, and so the inspiration is that much more real.
Can you share what benefits your portfolio companies get from receiving a strategic investment from Salesforce Ventures?
I think it’s important to keep in mind that we are the only strategic fund that’s 100 percent dedicated to backing enterprise companies. The portfolio we’ve built at a global level is a best-in-class “who’s who” of the leading cloud companies. At more than 300 investments, given the sheer size of our portfolio, there are a lot of best practices that we’re able to share with our companies.
Salesforce has had tremendous growth and continues to be on a path to be one of the fastest companies ever to get to $20 billion in revenue. I believe a lot of that has to do with our ecosystem. As we go to market in a new geography with new products, we’re always looking for complementary solutions that our customers can benefit from.
In addition, we offer a lot of Salesforce support for portfolio companies. Every company has an executive sponsor who is a GM, and we also provide go-to-market advice. I think the best entrepreneurs out there have this innate ability to learn and our goal is to help them accelerate that learning curve. As an example, we recently held a webinar with our pricing team at Salesforce. Getting access to Salesforce’s own best practices on this topic was truly invaluable for the CEOs in our portfolio.
Can you provide an example of a company that has benefited from these synergies with Salesforce and its ecosystem?
A great example is a company called Onfido. They use artificial intelligence to onboard, identify and verify users’ identities. One of their most common use cases is verifying someone’s identity as part of opening up a bank account. When the bank is also a Salesforce customer, Onfido is able to plug into that existing workflow and verify the identity as part of the customer onboarding process. So it’s a clear example of a way that we can deliver “1 plus 1 equals 10.” Salesforce is able to effectively extend the value of its platform through Onfido. Onfido is able to extend additional value to our joint customers and in turn integrate into their customers’ existing workflow for a better experience.
What advice would you give entrepreneurs who want to approach and work with Salesforce?
The best advice I can give is to think of it as a partnership. As an entrepreneur, you need to dedicate the energy and focus to make the relationship a success. The key is understanding what value you can bring to the table as a startup. Be really thoughtful about how your solution addresses gaps in the market and within our ecosystem.
Salesforce Ventures can also help you define that growth strategy. We work with our companies to identify where the most pressing customer needs are and how we can deliver customer success jointly.
Anything else you’d like to share?
Twenty years ago, Salesforce was founded in a small apartment in San Francisco. Today, we’re a generational company that still thinks like a startup. We know how hard it is to build a successful and enduring company. Our new fund is a testament to our commitment to backing the next generation of enterprise companies in Europe, and we look forward to working with many more great companies in the years to come.