Salesforce.com has reached a deal to acquire RelateIQ, a Palo Alto, Calif.-based startup, according to a regulatory filing with the U.S. Securities and Exchange Commission.

The deal values RelateIQ at a combined $390 million: Salesforce will issue shares worth about $350 million in exchange for all shares of RelateIQ. The filing says Salesforce expects to issue between 6.2 million and 7.6 million shares. Also RelateIQ has $40 million in cash from its latest VC round.

RelateIQ has built what it calls a “relationship intelligence” platform that uses machine learning to automatically capture data from email, calendars and phone calls to provide users with insights into their working lives in real time. The deal calls for RelateIQ to become a Salesforce subsidiary, the filing says.

RelateIQ had raised about $69 million in venture capital investments. The latest was that $40 million Series C announced in March and led by Redpoint Ventures with the participation of Kleiner Perkins Caufield & Byers, Felicis Ventures and the News Corporation. That round valued RelateIQ at $245 million, according to a report in The Wall Street Journal. Prior investors included Battery Ventures and Accel Partners.

I’ve reached out to Salesforce.com for a comment. But the filing is right here in black and white.

Update: RelateIQ CEO Steve Loughlin has now confirmed the deal in a company blog post. He writes that RelateIQ will inject a new level of intelligence across Salesforces’s service, marketing and sales products.

I met with this company last year, and I can see how they fit together. However, there’s a few people out there speculating that RelateIQ represented a long-term strategic threat to Salesforce, and so the bigger company is getting the technology for a song. Here’s a few comments from Twitter about that:



2 comments
Trevor Austin
Trevor Austin

"Salesforce is paying $350 million and RelateIQ $40 million in cash from its latest VC round." Does this mean $350M *in Salesforce stock* plus $40M?

ilMago
ilMago

@Trevor Austin  It means investors are keeping the $40M in cash and additionally getting $350M in CRM stock.

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