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Venture Capital 2021

Salesforce Devops Raises $275.5 million in 2021

Salesforce Devops 2021 Retrospective Series

Salesforce devops companies received $275.5 million of venture capital in 2021, which is a 7-fold increase from 2020. Here is my analysis of the Salesforce devops financial landscape and quotes from all the finance-related articles I wrote over 2021.

VCs Drop $275.5 million on Salesforce Devops

To analyze the dynamics of the Salesforce devops industry, I created a financial model called the “Keenan Vision Model.” The model collects and analyzes public and private financial information about Salesforce devops companies I curate. While I have not captured all industry finance data precisely, I think the model is close. Data is crunched and presented as industry summaries and projections, and individual company data is not released.

The Keenan Vision Model estimates the Salesforce devops industry received $275.5 million in venture capital in 2021. This was up 7-times from $38.5 million in 2020. The model also estimates the total investment in the Salesforce devops industry is $318 million since 2018, and the equity value of all the companies is $2.47 billion. Finally, the model estimates the total sales of the industry to be $197 million in 2021. This results in an equity-to-sales ratio estimate of 12.5x for the private Salesforce devops industry.

Salesforce Devops Venture Capital Landscape

Insight Partners is clearly the behemoth in Salesforce devops venture capital. Most of my finance stories mention Insight Partners, and it is the leading investor in Copado and OwnBackup. And the firm does plenty of cloud native devops and cybersecurity investments that don’t focus on Salesforce. The firm also has an outpost in Tel Aviv and has sniffed out global deals like Octopus Deploy from Brisbane, Australia. At the start of 2022 Insight Partners is the leading global VC in devops and cybersecurity.

Insight Partners joins forces with several venture partners in these deals. Notably, Salesforce Ventures and Perpetual Ventures were early stage Copado investors and participated in the $96 million Series B investment. Both firms, plus Japan’s Softbank Vision Fund, were on board for the $175 million Copado Series C. Full In Partners led the $14.5 million AutoRABIT investment, and a group of international investors made the $10 million Series A Prodly investment.

Copado wins the 2021 venture capital contest in Salesforce devops, getting $236 million of the $275.5 million, leaving $39.5 million spread between AutoRABIT, Prodly, and Opsera. Interestingly, most leading Salesforce devops companies, including Blue Canvas, Flosum, and Gearset, have not taken on any venture capital equity investments.

2022 Salesforce Devops Investment Outlook

Companies that have devops figured out don’t seem to have much trouble attracting investment money. 2021 ended with two big devops IPOs: GitLab and HashiCorp. Both performed well at their offering and have held up since. This bodes well for private investments because positive public market activity can have a positive impact on private investments.

This industry specific green light plus the general imbalance between the amount of money limited partners have available and the number of deals on the table, means VCs will be hunting for more devops equity deals in 2022.

Salesforce Devops VC Challenges

Pandemic-era changes have turned some VC companies upside down, with more services and investment options available for company founders. With Zoom now a de facto meeting method for everyone, the barriers to entry for a VC introduction have been lowered. And the success of Tiger Global has had shortening diligence cycles and bullying itself into deals, has challenged VC traditions.

Even though these external factors should allow VCs to drive a proliferation of new Salesforce devops companies, only Insight Partners has done an effective job sourcing investments in the space. But, there is considerable demand for faster and better solutions in Salesforce devops. So much so, that whenever a new company comes up with a solution it gets instant market acceptance.

However, rapid acceptance in the Salesforce devops market may turn out to be the proverbial two-sided sword for company founders.  If a Salesforce devops company is profitable, founders are eager to minimize equity dilution by turning down VC money. After all, who wouldn’t want to own a majority share of a profitable SaaS startup?

Well, the problem is that a dominant player in the industry, Copado, already has its sights set on a global market and is executing on a plan that requires massive up-front investment. So, if the competition doesn’t bulk up with similar plans those competitors risk ceeding important geographies or industrial sectors to Copado.

If Copado and Insight Partners become a dominant global force that crushes all competitors, the industry will be poorer as a result. What is needed is more outside investors helping to aim founders towards global markets. Those companies who have shunned investor money need to go through the growing pains for global expansion and better financial governance. The richness and quality of tomorrow’s Salesforce devops solutions depends on it.

Salesforce Devops Financial News 2021

Here are all the articles I wrote in 2021 about financial news.

  • Tech Mahindra Acquires Devops Service Provider DigitalOnUs for $120 million
    April 19, 2021

    “Just like how Tech Mahindra acquired DigitalOnUs, we should expect other global organizations to acquire smaller consultancies who specialize in Salesforce devops throughout 2021 and into 2022.”

  • Insight Partners invests $172.5 million in Australian Devops Company Octopus Deploy
    April 21, 2021

    “The fact that Insight Partners is making such a huge bet on a single firm indicates there is plenty of late-stage investor money sitting on the sidelines available for devops. Those investors are looking for popular, but still undervalued, devops products that can be leveraged to a global audience.”

  • AppOmni Snags $40 million Series B Led by Scale Venture Partners
    April 21, 2021

    “AppOmni already has the pedigree and experience to keep attracting customers before this investment. CEO Bendan O’Connor was a senior security officer at both Salesforce and ServiceNow. CTO Brian Soby is also a well-know figure in Salesforce security circles. They already have the experience needed to command Salesforce security for the most demanding customers.”

  • Opsera Nabs $15 Million Series A from Felicis Ventures for Low-Code Devops
    April 28, 2021

    “Opsera seems to have the background and experience needed to launch a startup into a Series A funding so quickly. The company’s two co-founders originally met while working at Symantec a few years ago. While there, the two worked on adapting the many developer and operations processes they inherited via Symantec’s many acquisitions. After Symantec, one of the co-founders ran Uber’s global infrastructure.”

  • Britive Raises $10 million Series A to Secure Software Supply Chains
    May 22, 2021

    “There is no lack of activity in the software development industry nowadays. Software cybersecurity is a juicy target for early-stage and growth investors as awareness grows. Most of these companies are profitable, have full pipelines, are tied into partner sales teams, and can use the capital to grow internationally. The trick is finding them, and it looks like Crosslink has a scored a potential winner.”

  • Salesforce Earnings are Historic and Dreamforce 2021 is On
    May 28, 2021

    “Salesforce earnings announced yesterday earnings that confirms it is growing dramatically in the post-pandemic digital economy. Salesforce blew away analyst expectations with quarterly results of $1.14 billion in profit or $1.21 per share. This outpaces an estimate of $0.88 per share, according to Reuters. “We had the best first quarter in our company’s history,” said Marc Benioff, Chair & CEO, Salesforce in a press release.”

  • OwnBackup Soars with $240M Series E on $3.35B Valuation
    August 10, 2021

    “With industry growth apparently not meeting the insatiable demand for cloud computing services, the remainder of 2021 and 2022 look to sustain an exciting level of startup company activity. So many companies have pulled the plug on old ways of doing things in every corner of the world, and with so many of those companies looking to Salesforce for solutions the Salesforce ecosystem must continue to grow like OwnBackup to meet the demand.”

  • Copado $140 Million Series C Investment Tops $1 Billion Valuation
    September 13, 2021

    “… because devops now represents the technical and managerial skills required to make a digital transformation work. Copado has clearly caught the app devops wave on a global basis. And the company is now riding a monster driven by Salesforce and organizational transformation. A question looming on the horizon is how long will the wave last, and if there will be a smooth transition to long-term, happy customers.”

  • Platform Cybersecurity vendor Adaptive Shield gets $30 million led by Insight Partners
    October 12, 2021

    “It is past time to amplify the seriousness of products like Adaptive Shield and get people moving to evaluate and implement intelligent platform cybersecurity. Product marketers should not just call it “Cloud Security” or SSPM. Make it frightening by adding the “Cyber” prefix. This is because IT and devops managers should be more frightened because they are all cyberwarriors now. Give IT and devops teams the battle IQ and weapons to keep out the threat actors who want them to fail.”

  • Prodly Gets $10M for Salesforce Devops
    October 22, 2021

    “As an industry observer, I still see the Salesforce devops market as strong and dynamic. After speaking with several executives at many of the leading Salesforce devops companies, I can confirm they are all seeing strong growth and sales. Most companies have found a niche they are exploiting nicely. Growth seems to be limited by their ability to build up sales and customer care infrastructure, both of which require up-front capital investment.”