Reason #1: Salesforce is securing enterprise and commercial deals both left and right.
If you analyze their presentation decks, you’ll notice their strong portfolio of clientele across numerous sectors such as high-tech, financials, retail, etc.
Reason #2: Salesforce’s core product offering is a cloud-based platform/software solution.
In analyzing the many different business models over the years, I have come to the realization that the platform/software model is an incredible business model to own. They’re easy to operate, lean/efficient, and have some of the best margins across all industries.
Reason #3: Salesforce is experiencing strong sales momentum currently (2018) and most recently in the past year they became profitable.
What can I say, the markets are going absolutely nuts for this security as of recent year (2017). In 2017 this security broke out from the 80s and skyrocketed to the 120s. To me this is indication of acceptance and recognition in the markets.
Reason #4: Salesforce operates in a $72 billion dollar market opportunity and this market expects to grow to $120 billion by 2021.
Not only are they in front of a large market opportunity, but the opportunity itself is quite diversified. Market opportunities such as: Sales, Service, Marketing, Commerce, Analytics, and especially Platform.
Reason #5: Salesforce’s Dreamforce appears to be one tech’s biggest events for the year.
In my own experience of sourcing enterprise deals I’ve come across Salesforce several times (competing in another portfolio business of theirs). I’ve ultimately learned that even though the enterprise I represented had a real and robust product, that was developed over a longer period of time than Salesforce, the power of marketing allowed them to beat the product I was selling. How can a enterprise that developed a similar software solution for about 1/4th of the time against their competitor be able to win these corporate deals?? The take-away lesson here is that its not always about the superior product, but instead it’s about how sold/convinced the current market is…
This is a powerful investment lesson here (at least for me…). You might have heard this over and over already, but “the markets are always right” and you have to move with what the markets want. There is no reason to fight the trend because if you do, you will end up paying for it.
Reason #6: Salesforce has been a Gartner magic quadrant leader for 9 years in a row.
Not much to comment here besides that this an incredible track record.
Reason #7: I personally use Salesforce for my own business and CRM requirements.
This seems to be the gold standard in the CRM space. Instead of a full on ERP solution, there are corporations out there that don’t have inventory because its essentially software and so the Salesforce CRM solution is lean and efficient. Buying the ERP software would be overkill.
Reason #8: Salesforce does business at an international scale across the Americas, EMEA, and APAC.
Not only is the exposure multinational, but the digital infrastructure and technology exist for them to continue their dominance.
Reason #9: Salesforce is well known by consultants/GSIs (Global Systems Integrator).
This is a major external analysis of the B2B networks that Saleforce plays in. It appears that these GSIs are recommending Salesforce to their enterprise clients, which is helping them win the deals.
Reason #10: Salesforce owns the tallest building in San Francisco.
What happens when a nation is thriving and have excess capital? They start to build national wonders that are not really investments, but more of a nation bragging rights… Jokes aside, the fact that Salesforce just recently put up the tallest building in San Francisco (in my opinion) is just the beginning of their dominance.
Technical Chart: CRM continues to maintain the longer term up trend. The key trend that it appears to be respecting the most is the 50MA for all of 2017. It looks like the gains made in 2017 will continue into 2018.