CRM News: CRM: RightNow Technologies Scoops Up Salesnet

RightNow Technologies Scoops Up Salesnet

By Erika Morphy
CRM Buyer
05/22/06 2:50 PM PT

The acquisition is a bit of a departure from RightNow's typical strategy of organic growth, but it is consistent with the company's vision of the CRM industry, Nucleus Research vice president Rebecca Wettemann told CRM Buyer.

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RightNow Technologies (Nasdaq: RNOW) announced it has acquired Salesnet, a provider of specialized, on-demand sales force automation (SFA) methodology, in an all-cash transaction for an undisclosed sum.

The acquisition, which is being hailed as a smart move on the part of RightNow, will expand its customer base and shore up its SFA capabilities.

Customers stand to benefit from the acquisition as well. Application integration is hardly the painful process in the on-demand world that it can be in an on-premise environment -- and the addition to RightNow's full CRM suite will deliver even more functionality.

Ongoing Support

"RightNow is all about delivering full featured CRM to the enterprise and not just focusing on on-demand delivery," she said. "Bringing Salesnet onboard will considerably enhance its overall product suite."

RightNow intends to maintain support for Salesnet's existing customers, while also providing an upgrade path to RightNow's product line. Initial integration between Salesnet and RightNow will be completed this summer, with all major features expected to be part of a new offering by the summer of 2007.

RightNow is adding 26 employees and a dozen off-shore development contractors with the acquisition. RightNow CEO Greg Gianforte also said the acquisition will add "hundreds" of customers to RightNow's client base.

Recognized Expertise

RightNow will also incorporate Salesnet's recognized expertise in sales workflow and methodologies.

"Salesnet excels in providing users with the sophisticated tools needed to handle more complex selling environments," Denis Pombriant, managing principal at Beagle Research Group, said.

"When customers need to move beyond simple contact management to standardize practices for sales forces across geographies and divisions, they look to Salesnet," he added.

Jonathan Tang, president and co-founder of Salesnet, will become vice president of sales solutions at RightNow. Rich Perkett, chief technology officer and co-founder of Salesnet, will join RightNow as a director of product development, responsible for the integration and expansion of Salesnet's technology into RightNow's solution.

Under the terms of the acquisition, RightNow expects the transaction to be neutral to cash flow from operations and dilutive to GAAP EPS (generally accepted accounting principles earnings per share) in 2006. Salesnet's corporate office in Boston will become RightNow's Boston office and will continue to include development, sales, marketing and support functions.

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