Amid Acquisition Rumors, Salesforce Partners with Sage

Salesforce and Sage have announced a partnership that will see the two companies launch a new cloud platform for small businesses.

Holding a joint press conference in San Francisco, Salesforce CEO Marc Benioff and Sage CEO Stephen Kelly announced Sage Life, a new application built on the Salesforce1 platform.

Sage Life is a service that allows small to medium-sized businesses to view and manage their accounting, payroll, and financing data through desktop, mobile devices, and even smartwatches.

The platform is powered by Salesforce, which gives Sage the cloud boost that it needs, according to Forbes’ Ben Kepes. Sage, he says, has been the slowest at adopting cloud technology compared to other accounting and payroll giants like Intuit. The partnership will give the company a “healthy dose of credibility that comes from being friendly with Salesforce.”

Small business software no longer has to represent different systems or layers of complexity – it’ll be simple, collaborative, and real time

According to Sage and Salesforce, the average small business uses four to eight software applications to manage their business processes. Sage Life combines the functions of all these applications into one system, they claim.

“Small business software no longer has to represent different systems or layers of complexity – it’ll be simple, collaborative, and real time,” said Stephen Kelly, CEO of Sage, which is based in the UK and employs 13,000 employees worldwide.

Kelly said that Sage Life will integrate with other Sage products and the transition from licensed software to cloud computing should run smoothly. However, analysts have warned that Salesforce may increase its pricing by 2017 to return a profit, and partnering with Sage gives the company access to new customers.

This is Salesforce’s second partnership with Sage this year. It previously announced in February a deal that would allow Sage employees globally to use Salesforce’s Customer Success Platform.

Acquisition Rumours

The partnerships come at an interesting time for Salesforce as it is currently embroiled in acquisition rumors, with Microsoft among the potential suitors.

“I can’t comment on the [merger and acquisition] rumors, of course, because that’s just the nature of M&A rumors,” said CEO Benioff, as reported by the San Jose Mercury News. Should an acquisition happen, with a company like Microsoft which has its own ERP offerings, it would combine two of the industry’s major players into one and have a considerable impact on competition in the ERP field.

The partnerships with Sage are unlikely to have a huge impact on a potential acquisition, according to analyst Denis Pombriant, pointing out that this announcement had been planned for months. “It sounds like a straight partnership and not much more. Someone could still be trying to buy Salesforce, but I sincerely doubt it, as I don’t think the company is buy-able right now,” he told PC World.

In a separate blog, Pombriant adds that many of the rumors of a Salesforce acquisition have been lacking in details and each one “relied on hearsay and unnamed sources to build its case.”