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Author Interview: Marc Benioff


Marc Benioff, founder Salesforce.com, is the author of the book Behind the Cloud. Mark spoke to us about his book and his vision on cloud computing.

theCloudTutorial: There are many definitions of Cloud Computing. How do you define Cloud computing?

Marc Benioff: Cloud computing is a technology model that refers to anything that involves delivering services over the Internet. The idea rests on something we call "multi-tenancy" and it's easy to think of it as an apartment building, where the tenants of the building share common costs such as building security or the laundry facilities, but they still have locks on their doors and the freedom and ability to design their apartments as they wish. Consumer services like Yahoo! Mail or Gmail use this kind of model - it's how their consumers access their individual mail accounts cheaply (or even for free) through a browser without the need to install any software. It's how myriad users share the same back end systems. Salesforce.com stood on the shoulders of consumer giants like Amazon, Yahoo!, and eBay, which had pioneered this idea and demonstrated that companies could run all their business information that same exact way.

The term cloud computing gets thrown around a lot these days by a lot of companies, so it's no surprise that some people are confused. Simply put, cloud computing is a better way to run your business. Instead of running your apps yourself, they run on our data center. When you use any app that runs in the cloud, you just log in, customize it, and start using it. Companies that use cloud computing don't have to worry about upgrades, maintenance, security, backup, hardware tuning or any of those concerns. Businesses that use Salesforce applications can focus on their customers, grow sales, and deliver great service. Cloud computing offers a completely different way of managing your data and your business.

The way you pay for cloud-based apps is different than the way the software industry has historically worked. There's no longer a need to buy servers and software. When your apps run in the cloud, you don't buy anything. It's all rolled up into a predictable monthly subscription, so you only pay for what you actually use. You've probably heard that described as Software-as-a-Service or SaaS.

theCloudTutorial: Tell us about your book Behind the Cloud: The Untold Story of How Salesforce.com Went from Idea to Billion-Dollar Company-and Revolutionized an Industry on cloud computing?

Marc Benioff: This book is the story of a few people who started working on simple idea in a rented apartment and the unlikely revolution that resulted. It's the story of our customers, who tested a new model, took bet with us on the future, and taught us so much. It's the story of our partners who helped us expand our service and build an industry that once didn't exist - and that has since changed the way all businesses use software applications and the way the software industry works. I'm excited that this is the first book that tells the story of the creation of the cloud computing industry and shows how we brought businesses into the cloud in an era dominated by mass consumer cloud services like Facebook, Google, and Twitter.

The book shares the incredible lessons we learned along the way. It is written as a Playbook and divided into the 111 plays that made salesforce.com successful. It's my hope that at a time when more entrepreneurs are starting companies faster and cheaper than ever before, the simple, accessible, and unconventional advice offered in the book can help entrepreneurs stand out, innovate better, and grow faster in any economic climate.

theCloudTutorial: What inspired you to write this book?

Marc Benioff: People always ask me, "How did you start salesforce.com," "How did you beat much larger competitors," "How do you integrate philanthropy into the business model"? Every day I get bombarded with these types of questions, and while I love talking about the lessons we've learned at salesforce.com, I recognized there must be a more efficient way to share them. I wanted to write a book that would help entrepreneurs and business leaders in any industry create more innovative, more profitable, and more meaningful companies.

The biggest lesson that I draw from the past decade is the importance of innovating on every level. In our case, the first two areas of innovation were obvious: the technology (a massively scalable multi-tenant cloud service) and the business model (subscriptions). We also developed a new accounting model, a new marketing model, and a new philanthropy model. Our failure to innovate in any one of these areas could have resulted in a far less successful company.

Confidence in your primary innovation is never enough. You have to keep innovating in every part of the company. That's much harder than it sounds. When I look at companies that have failed despite having great ideas, it's usually because they didn't extend that spirit of innovation to every aspect of the business. This book was a way to share my experiences of building salesforce.com with a new generation of entrepreneurs who were ready for a different message.

theCloudTutorial: What is the target audience for your book?

Marc Benioff: I thought there was a need for a book that takes people through the start up stages of a company and continues with stories and lessons about how to maintain growth and quality in a fast-paced environment. Many of the readers are in the technology space and interested in cloud computing, but we've seen that it scales far beyond tech. Based on the feedback we receive from readers across many industries, the book provides easy to implement plays for all kinds of entrepreneurs and business leaders.

Many of the new models we created (for marketing, sales, technology, finance, philanthropy, global expansion, and leadership) have already been effectively employed by other companies, and we believe that any company can succeed with these strategies and the new models are especially relevant in this economic climate.

theCloudTutorial: Which trends do you see in this decade for cloud computing?

Marc Benioff: The next new frontier is collaboration. Much as we once learned from consumer sites such as Amazon.com and eBay, we've all learned a tremendous amount from the latest consumer development, the rise of social networking. Businesses are watching these new services and they are asking, "Why do I know more about strangers on Facebook than my own employees? Why is it so easy to follow Ashton Kutcher on Twitter, but I can't follow a key deal? Why can a picture tell me that I have been tagged, but a document in my company can't tell me it has been updated?"

There's a very compelling immediacy to services like Facebook and Twitter. One look and you know what is going in your whole world. That's what we really want from our business technology today. Consumer services have outpaced enterprise technology. Businesses aren't going to wait for the traditional software companies to catch up. The consumerization of IT and the growing influence of social networking are going to be major trends to unfold over the next few years. Customers want new functionality, but they don't want the traditional complexity that has plagued products in the past. Vendors that understand that will win.

theCloudTutorial: Which cloud computing vendors are going to grow exponentially in the next couple of years?

Marc Benioff: Cloud computing has reset customer expectations around innovation. The most successful companies over the next decade will be the ones that understand these higher expectations and then deliver on them.

On a related, but separate note, part of what makes working in our industry so thrilling is that we have no idea right now what the next great devices will be and how they will be able to benefit from information technology. There are incredible efforts underway in cleantech and I believe there will be a revolution in how energy is produced, transported and stored. Health care is another area that is begging for better information technology and I hope the current push for health care reform will result in new ways to partner on that effort.

theCloudTutorial: Is the hype around cloud computing justified?

Marc Benioff: Gartner Group predicts that cloud computing will continue to be the top strategic opportunity in technology for 2010, and it has forecast that cloud revenue could grow from $56 billion in 2009 to $150 billion in 2013. We used to be alone (and it was challenging work to gain acceptance for this new idea), but now there is a robust marketplace of cloud applications and cloud platforms. There are many clouds to choose from - everything from financials to the classic productivity apps we all use every day.

Customers are voting for the cloud because the software industry grew too greedy, too complex, and too out of touch with the customer. Outrageously expensive to buy, costly to maintain, and difficult to change, traditional client-server software has failed customers for too long. Even Microsoft, the company that stands to lose the most from this dramatic shift, has pledged to introduce cloud-based services. This is good news; it opens minds and markets for us and for a whole new generation of entrepreneurs who are creating new applications in the cloud.

The reality is that in information technology, one paradigm on rarely ever completely replaces another. We have many customers who still use some form of mainframe and will probably continue to do so for some time. But the hearts of minds of the industry's innovation culture do migrate to new paradigms, taking with them the best new ideas and applications. When was the last time that someone told you about a hot new shrink-wrapped business app? Maybe 10 years ago! The best innovation is happening in the cloud right now, and customers know it.

It's incredible to consider what's happened in the 10 years I've been in this business, yet I know that we are just beginning to prove how far cloud computing can go. While it is generally accepted that cloud computing can help companies reduce cost and complexity, this is only a fraction of the story. The most exciting part is the potential impact on innovation for small and large businesses and organizations, entire industries, local governments, and even nations.

A new era of enterprise agility is opening up as clouds mature and cloud platforms become more widely used. Google's AppEngine, Amazon Web Services, and our Force.com take vastly different approaches, but all of them liberate the customer from the time-consuming task of provisioning new hardware and software. There's no longer a need to fire up a server, worry about where it was going to sit in the data center, or fret over incremental real estate or infrastructure costs. The significance of that is staggering; in the case of force.com, developers achieve results five times faster and at half the cost of traditional platforms. We are looking at a very real potential for mass innovation. For the first time, developers across the globe can access unlimited computing power. With a browser and a Web connection, anyone can build applications and deploy them to users anywhere.