From startup to giant
If you’ve been paying attention to this blog over the last couple of months, you’ll have noticed that I’ve been sharing the stories of some of the high performance organisations that inspired Versapia’s Culture Operating System. Here’s one more, and it’s one of my absolute favourites…
In 1999, a high-flying Oracle executive named Marc Benioff left the bosom of his employer, moved into a rented apartment on San Francisco’s Telegraph Hill and got to work building a very different kind of software company. His idea was radical at the time: a customer relationship management (CRM) system delivered entirely over the internet. Instead of costly installations and on-premise servers, customers would login through a web browser and use the platform. This concept of “software as a service” was so new that Benioff adopted the mantra “No Software” as Salesforce’s core marketing message, famously staging mock protests at rivals’ conferences. It was an irreverent piece of PR, but it perfectly represented Salesforce’s rebellious culture, with fearlessness, imagination and a ton of flair at its heart.
Importantly, beneath the showmanship was a genuine mission to make business software easier and more accessible, freeing customers from the headaches of enterprise software by hosting it all in the cloud.
Salesforce’s culture was apparent from the outset. Benioff made a point to embed “doing good for others” into his baby business, with a clear vision to build a company that had philanthropy and social responsibility embedded in its DNA. Within months of founding Salesforce, the 1-1-1 model was established, which dedicated 1% of the company’s equity, 1% of its product and 1% of its employees’ time to communities and nonprofits. While the impact was small to being with, at time of writing Salesforce has given over $700m in grants and 9 million volunteer hours, inspiring thousands of other companies (including mine) to adopt their own versions of 1-1-1.
Along with philanthropy, Salesforce’s founding team emphasised trust and customer success as core values. They knew companies would be wary of putting data in the cloud, so trust was key. Unprecedented transparency measures like a public system status dashboard (groundbreaking at the time) helped them to earn the confidence of their customers. Benioff himself pioneered a new method of objective setting and performance management, V2MOM, to align every employee with the company’s goals and values. A further focus on innovation and equality rounded out the principles on which Salesforce built an empire.
It wasn’t all smooth sailing, though. Just a year after their launch, the dot com bubble burst, sinking most internet startups. Many of Salesforce’s clients at that time were those very companies, and their customer base was decimated. Driven by their vision of a world beyond enterprise software, Salesforce marched on. While competitors cut costs and restructured, Salesforce focused even more on making their remaining customers successful, assuming that if they were happy, they’d spread the word. By 2002, they’d expanded to service 3,300 companies, including early enterprise clients like Adobe and Dow Jones. Despite an economy in freefall, revenue grew at 300% year over year, continuing to build trust, brand and a product that people loved. More and more large clients decided to try the SaaS model, and Salesforce not only survived the tech crash but by their IPO in 2004, they’d created and validated an entirely new model of software delivery.
After going public, Salesforce expanded rapidly, but Benioff was determined to preserve core parts of the culture while evolving other elements. The product line expanded into Service, Marketing and more, but customer success remained at the heart. In 2005, the AppExchange (claimed to by the inspiration for Apple’s App Store) was introduced, allowing outside developers to create applications and integrations, a risky notion that led to the rise of an innovation ecosystem around the Salesforce platform.
The Salesforce team grew to several thousand people, and Benioff championed the concept of Ohana, the Hawaiian word for family, to provide an anchor for the company’s inclusive culture. Ohana meant that everyone connected to Salesforce - employees, customers, partners and the community, should feel like part of a supportive family. This wasn’t just talk. Internal groups got to work on diversity and inclusion, the gender pay gap, and several other issues. By creating and celebrating a genuine sense of community, Salesforce maintained the essence of its culture even as it became a tech giant.
The commercial success that Salesforce’s culture drove is unquestionable. From pioneering the cloud model to introducing a mobile CRM app in the early days of smartphones and investing heavily into AI through their Einstein platform, Salesforce has delivered a series of innovations all designed to make their customers more successful. The company’s reputation for values-driven leadership has helped to attract and retain loyal employees, and over 25 years the business has grown from a tiny apartment startup to the world’s #1 CRM platform with over $30bn in annual revenue. It’s consistently cited in Most Innovative Companies and Most Admired Companies lists, and as Benioff reflected in his memoir Trailblazer, “the most powerful engine of our success…was the decision we made in 1999 to orient our culture around values.” Every product milestone and market win that followed can be traced back to that conscious cultural foundation.
As you reflect on the story of Salesforce, I’d ask you to consider: how strong is your foundation? How deliberately are you shaping the organisation you’re building? The answer to these questions may make the difference between success and failure…
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