The Data Landscape Shake-up: Mergers and Acquisitions Unpacked

WEBVTT

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Today, Junaid, Karen, and I are doing things a little differently.

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We're introducing The Prompt, a short format mini-sode to unpack topics in data

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and AI with sharp takes and real-time reactions.

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Not to worry, our regular How I Met Your Data format is not changing.

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We will still have our longer format conversations with our amazing lineup of guests.

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But in the spirit of growth this season, we're also bringing you bite-sized

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conversations on the topics most top of mind.

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Views expressed by me and our guests are our own and do not reflect those of our employers.

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So grab a coffee, get comfy, and let's dive in.

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Today, we are diving into a growing trend in the data and analytics space.

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There's major acquisitions and mergers across tech and data players that are

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shaking up the data landscape as we know it.

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For example, a few weeks ago, ServiceNow announced that they're acquiring Data.World,

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which to me was a clear signal that workflow intelligence is only as smart as the data underneath it.

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And then Salesforce and Informatica finally agreed to terms in a deal that could

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reshape, in Salesforce's words, the future of AI-ready data infrastructure.

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So clearly, enterprise giants are doubling down on governance,

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cataloging, and integration.

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And I think many of us are left asking, what does this mean for the rest of us?

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So before we really get too deep into the conversation here,

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any immediate reactions to these acquisitions or other acquisitions or mergers that we've seen?

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You know, for me, it's not a surprise, right? that this acquisition has sort

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of been in touch for a year or something like that.

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And so not surprising.

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They got a $2 billion discount, I think, from a year ago.

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But no real surprises for me.

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There's this acquisition, but then there's also, which is a data point,

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but I think we see a trend between the Caster acquisition by Coalesce and also

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Data.World for ServiceNow.

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So clearly, I mean, if you need any affirmation that data governance is the

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core of, I'll go out and let them hear success with AI or agentic activity, that is,

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you don't need any more demonstration of that by billions of dollars.

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I mean, we're really, that's, that's more than just talking.

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That's an actual like affirmation in the market.

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I think you'll see continued acquisitions, like the amount of companies that

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have spun up in the data and AI space, not just, you know, five, seven years ago,

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but especially the last two, three years, the number of companies that have jumped into the game.

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I think that that number is only going to increase in the coming,

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you know, let's say two, three, four or five years.

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And then you're going to go, you know, have a period of consolidation. it.

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So I think, you know, this is a merger of two huge companies,

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but I think you will see this sort of continuous acquisition activity that'll happen.

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Yeah, I agree. I wasn't overly surprised that this boomeranged back from a Salesforce

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and Informatica perspective, just knowing that it was quite the talk April of

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last year, and now it's come back.

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But Karen, you bring up an interesting point and, you know, one that back in

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kind of as I was coming up through the data and analytics space and I was working for a software vendor.

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One of the things that we really brought forward in our go-to-market conversations

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was vendor lock-in and how these giants were actually locking in their customers.

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They do a lot of things, but none really well.

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So they're jack of all trades, but an expert and not.

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So with these acquisitions and this growing trend, do we think that we're going

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back to a world of vendor lock-in?

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I think it's a paradox if I were to bring, address that question in the sense

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that, yes, they want to be, and it's a lot of things, but in answer to your

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question directly, I think multi-cloud is just status quo now.

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Like that's an acknowledgement that your data is in many places.

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And so there's competition when you talk about vendor lock-in,

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perhaps that who's going to be the focal point where all of it comes together.

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And I think that's what you're seeing is that they want the source of truth.

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Salesforce wants to be that source of truth, which is what has been the Achilles

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heel or weakness of their market strategy so far, and that you need a lot of

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different components to make it work.

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And more specifically, also, a lot of the regulatory challenges that so many

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organizations are starting to see more and more, and that it's,

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I think it's fair to say, a lot of spreadsheets.

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You got to make a change. And so how do you become that focal point,

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that center of gravity for your whole data experience, I think this is a clear

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indication of how they're solving that problem.

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The interesting thing about this merger is I think it's, you know,

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when we talk about data and AI, this is.

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I think Salesforce's recognition of data being essential for AI, right?

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Like, it is the clearest, you know, you know, Informatica is an industry leader

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in the space of data management, data governance, data integration.

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And, you know, we all know that AI is not a sort of passing term, right?

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Or something that's a fad that's going to go away.

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And I think that the, you know, the shift, Like this is a clear shift that,

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you know, to be AI ready, you've got to take data especially seriously.

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So it could be interesting to see the products and innovation that comes out

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of an acquisition like this.

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I think the core to success for any acquisition is how some of the parts come together, right?

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So really creating a one plus one equals three or more model.

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And it comes down to the integrations.

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So that, to me, was a big red flag in terms of,

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oh, God, this could really go poorly for a lot of organizations if that integration

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across these systems isn't really done thoughtfully or is not done well.

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You know, acquisitions are always interesting.

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You know, I was first as a bank, which acquired CIT Bank and Silicon Valley Bank.

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And I think, you know, the data integrations, you know, capabilities and data

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integrations and system integration.

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The biggest inhibitor, honestly, that I've seen is that there are people silos

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and culture silos versus technical limitation.

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I feel like we're in a day and age now that any technical issues are overcome relatively easily,

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but it is the cultural and the people silos that I think make integration really hard.

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And I don't know enough about Salesforce culture or, you know,

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if Mousekos culture, but I'm curious to see how that aspect of it plays out.

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I mean, there's so many different ways to skin a cat.

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But yeah, I think there's other market approaches to solve that problem.

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I think we've seen Unity Catalog, and there's been an intention to try to create

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open source solutions to manage that.

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However, you know, that's really from an enterprise standpoint,

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there are very specific requirements to manage to attest to having,

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you know, enforcing your governance practices or doing what you say you're going to do.

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But then to your point, Junaid, then there's the next level of where it actually

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has meaning and you're cooking with gas, so to speak, which is the people part

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where everyone actually.

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Among the different groups, trust the data enough to collaborate together.

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And that's, as we've all seen, I'm sure, really the point of failure.

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And I think this is really solving that lower level problem that everyone's

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seeing in the market from an enterprise side of the business of why do we want

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to go with Salesforce or ServiceNow, for example, and because you can check that box, right?

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And what it enables or you can build upon because ultimately when that data

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governance isn't in place, whatever you do is just exacerbated.

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Mostly bad, but if it's good off, I mean, then you can really run with it, obviously.

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And that's literally the selling point. Yeah. I mean, I've been involved with

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a number of environments where it's Salesforce driven.

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And now the organization that we're working with is looking to also integrate

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master data and actually think about master data holistically.

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But because our conversations begin from a CRM perspective, we end up in a situation

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each and every time where the scope of what we ultimately master is only what lives in CRM,

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whether it's Salesforce or, you know, another CRM tool in the market.

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And so now you've got blind spots across your organization because your master

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data does not truly reflect your enterprise.

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And so that was one of the concerns that I had was I've seen that happen multiple times.

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So now, will we actually see a fully enterprise-facing solution from a master

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perspective that is able to satisfy the CRM need?

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It's going to be an interesting journey for sure.

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I think, you know, I, you know, again, I think that this is a good thing.

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I think that these are two big companies, both leaders in their.

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Spaces. I can only see good things coming out of this acquisition.

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It may take a couple of years, but,

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I think it's going to be a good fight. I mean, we'll see.

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It's feast or famine. And those that are left in the market,

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like point solutions, are really going to have to make a greater case for how

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they are solving problems in the market.

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So we're living in exciting times.

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We've touched on so many topics, but so much of our conversation came back to data governance.

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What do you think that this signals for data governance and AI readiness?

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Governance, metadata management, they're becoming cool, or at least that's what I'm telling myself.

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But are we just kind of relabeling old problems with a shiny new wrapper?

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Or are we actually going to see things being done a little bit differently?

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I think the former. I think for like, you know, I've seen very few companies

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that really ever solve the core problems.

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Like, you know, every time I go to a conference, it's always the same topics.

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How to improve their data quality, how to do better metadata management.

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If you look at the agendas of conferences from 15 years ago to today,

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if you just take out the AI component of it, it is always how do you find efficiency?

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How do you strategically implement these core capabilities like metadata management, data quality?

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It's always the same kind of things with a new twist.

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You know, data products came up a few years ago. And, you know,

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data, you know, the notion of data products is predicated on having really good metadata management.

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So the angle became, hey, you should build data products.

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And the prerequisite is go do good metadata management.

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So I personally believe it's, you know, unfortunately, and maybe this is another

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topic for another day. why are we solving the same problems that we have been

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for the last 15 years is another, I think.

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But I think it's the former, which is another angle at this.

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I'll be the cynic. Yeah, I think I'll go, I'll extend and say we've been doing

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the same thing ultimately for about 30 years and we're relabeling it to put it nicely.

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And there have been a lot of different ways to spin or come up with new vernacular

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often generated by Gartner.

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And I mean, when you separate the sales jargon versus the ultimate goal.

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I think everybody is trying to create a better mousetrap, so to speak.

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But clearly, despite all the shiny things and new words, it's the same problem.

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And often we seem to be recreating these problems and restating them over and over again.

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And so those who have been around long enough are like, hey,

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this has been done before.

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And so I'm seeing that often even on LinkedIn comments. And so I think the difference

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is ultimately the consequence.

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And that's really, I think, what's given this lift where it hasn't before because

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of the revenue opportunities that you can, in theory, for a lot of these more

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brick-and-mortar companies.

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Capture revenue because of that. So now it's garnering a lot more attention.

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And we'll see how it plays out as everybody is kind of fumbling through what is going to work for us.

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I've seen the wave of how do I create a really pretty dashboard?

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How do I expose data products, things like that? And it keeps coming back to

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those are end user experiences.

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So ultimately, it's how does the plumbing and

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the data best support how my users

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need to use access and understand their

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data and so that fundamentally has not

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changed because we've applied I'll call it

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minimal attention to the plumbing and really at what the end user experience

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is intended to be I think you hit the nail on the head Anjali you said it and

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like the probably the best way which is that these things are the end user views

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and like the outcomes that we're trying to achieve.

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So we haven't solved the core problems to make the data really leverageable.

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I have this joke about like what big data is and I was saying it's just data

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that we forgot to delete.

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Right? Nothing more to it than that sometimes. But I think you hit the nail on the head, Angela.

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So any closing thoughts on what we expect to see in maybe the next three to six months?

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I'm not sure about the next three to six months, but I do think in the next,

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like, you know, 12 to 24 months, you'll see more consolidation.

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You'll see more companies spin up and you'll see more consolidation or more acquisitions.

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I mean, it's the ultimate, you know, economic theory and practice of,

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yes, consolidation, those acquisitions.

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The strongest product offering are going to survive and there's going to be a lot that don't.

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So it'll be very exciting to see how that plays out in reality for those that

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already are, for example, Salesforce or ServiceNow customers and what the reality

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of the implementation is.

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Because the other side of it is like, cool, they've all been acquired,

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but how do you actually integrate it in so it does the thing that you wanted

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it to do when you originally made that acquisition?

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Yeah, I mean, my prediction is

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we're going to see a cycle of consolidation and then it's going to stop.

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Not because there's no more consolidation opportunities, but because we go back

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to an old conversation around vendor lock-in and organizations no longer want

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a single throat to choke and are looking for capabilities that best fit their

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needs or fit for purpose.

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And we'll start going to smaller vendors again to find who can do what they

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need the best and then figure out how to string it together.

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As the pendulum swings, right?

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Or as the world turns, these are the days of our lives.

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Guys, thank you so much. This was the conversation I needed to have this week.

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Reading all the posts, reading all the news, and I'm so excited that you were

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able to share your time and your opinions with me and our listeners today.

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Thank you.