AWS confirms reports it will challenge JEDI contract award to Microsoft

Surely just about everyone was surprised when the Department of Defense named Microsoft as the winner of the decade long, $10 billion JEDI cloud contract last month, none more so than Amazon, the company everyone assumed all along would be the winner. Today the company confirmed earlier reports that it was challenging the contract award in the Court of Federal Claims.

The Federal Times broke this story.

In a statement, an Amazon spokesperson suggested that there was possible bias and issues in the selection process. “AWS is uniquely experienced and qualified to provide the critical technology the U.S. military needs, and remains committed to supporting the DoD’s modernization efforts. We also believe it’s critical for our country that the government and its elected leaders administer procurements objectively and in a manner that is free from political influence.

“Numerous aspects of the JEDI evaluation process contained clear deficiencies, errors, and unmistakable bias — and it’s important that these matters be examined and rectified,” an Amazon spokesperson told TechCrunch.

It’s certainly worth noting that the president has not hidden his disdain for Amazon CEO and founder Jeff Bezos, who also is owner of the Washington Post newspaper. As I wrote in Even after Microsoft wins, JEDI saga could drag on:

Amazon, for instance, could point to Jim Mattis’ book where he wrote that the president told the then Defense Secretary to “screw Bezos out of that $10 billion contract.” Mattis says he refused, saying he would go by the book, but it certainly leaves the door open to a conflict question.

Oracle also filed a number of protests throughout the process including one with the Government Accountability Office that was later rejected. It also went to court and the case was dismissed. All of the protests claimed that the process favored Amazon. The end result proved it didn’t.

The president interjected himself in the decision process in August, asking the Defense secretary, Mark T. Esper to investigate once again if the procurement process somehow favored Amazon, and the week the contract was awarded, the White House canceled its subscription to the Washington Post.

In October, the decision finally came and the DOD chose Microsoft . Now Amazon is filing a challenge in federal Court, and the JEDI saga really ain’t over until it’s over.

 

Salesforce announces it’s moving Marketing Cloud to Microsoft Azure

In the world of enterprise software, there are often strange bedfellows. Just yesterday, Salesforce announced a significant partnership with AWS around the Cloud Information Model. This morning, it announced it was moving its Marketing Cloud to Microsoft Azure. That’s the way that enterprise partnerships shimmy and shake sometimes.

The companies also announced they were partnering around Microsoft Teams, integrating Teams with Salesforce Sales Cloud and Service Cloud.

Salesforce plans to move Marketing Cloud, which has been running in its own data centers, to Microsoft Azure in the coming months, although the exact migration plan timeline is not clear yet. This is a big deal for Microsoft, which competes fiercely with AWS for customers. AWS is the clear market leader in the space, but Microsoft has been a strong second for some time now, and bringing Salesforce on board as a customer is certainly a quality reference for the company.

Brent Leary, founder at CRM Essentials, who has been watching the market for many years, says the partnership says a lot about Microsoft’s approach to business today, and that it’s willing to partner broadly to achieve its goals. “I think the bigger news is that Salesforce chose to go deeper with Microsoft over Amazon, and that Microsoft doesn’t fear strengthening Salesforce at the potential expense of Dynamics 365 (its CRM tool), mainly because their biggest growth driver is Azure,” Leary told TechCrunch.

Microsoft and Salesforce have always had a complex relationship. In the Steve Ballmer era, they traded dueling lawsuits over their CRM products. Later, Satya Nadella kindled a friendship of sorts by appearing at Dreamforce in 2015. The relationship has ebbed and flowed since, but with this announcement, it appears the frenemies are closer to friends than enemies again.

Let’s not forget though, that it was just yesterday that Salesforce announced a partnership with AWS around the Cloud Information Model, one that competes directly with a different partnership between Adobe, Microsoft and SAP; or that just last year AWS announced a significant partnership with AWS around data integration.

These kinds of conflicting deals are confusing, but they show that in today’s connected cloud world, that companies who will compete hard with one another in one part of the market, may still be willing to partner in other parts when it makes sense for both parties and for customers. That appears to be the case with today’s announcement from these companies.

AWS, Salesforce join forces with Linux Foundation on Cloud Information Model

Last year, Adobe, SAP and Microsoft came together and formed the Open Data Initiative. Not to be outdone, this week, AWS, Salesforce and Genesys, in partnership with The Linux Foundation, announced the Cloud Information Model.

The two competing data models have a lot in common. They are both about bringing together data and applying a common open model to it. The idea is to allow for data interoperability across products in the partnership without a lot of heavy lifting, a common problem for users of these big companies’ software.

Jim Zemlin, executive director at The Linux Foundation, says this project provides a neutral home for the Cloud Information model, where a community can work on the problem. “This allows for anyone across the community to collaborate and provide contributions under a central governance model. It paves the way for full community-wide engagement in data interoperability efforts and standards development, while rapidly increasing adoption rate of the community,” Zemlin explained in a statement.

Each of the companies in the initial partnership is using the model in different ways. AWS will use it in conjunction with its AWS Lake Formation tool to help customers move, catalog, store and clean data from a variety of data sources, while Genesys customers can use its cloud and AI products to communicate across a variety of channels.

Patrick Stokes from Salesforce says his company is using the Cloud Information Model as the underlying data model for his company’s Customer 360 platform of products. “We’re super excited to announce that we’ve joined together with a few partners — AWS, Genesys and The Linux Foundation — to actually open-source that data model,” Stokes told TechCrunch.

Of course, now we have two competing “open” data models, and it’s going to create some friction until the two competing projects find a way to come together. The fact is that many companies use tools from each of these companies, and if there continues to be these competing approaches, it’s going to defeat the purpose of creating these initiatives in the first place.

As Satya Nadella said in 2015, “It is incumbent upon us, especially those of us who are platform vendors to partner broadly to solve real pain points our customers have.” If that’s the case, having competing models is not really achieving that.

Freshworks raises $150M Series H on $3.5B valuation

Freshworks, a company that makes a variety of business software tools, from CRM to help-desk software, announced a $150 million Series H investment today from Sequoia Capital, CapitalG (formerly Google Capital) and Accel on a hefty $3.5 billion valuation. The late-stage startup has raised almost $400 million, according to Crunchbase data.

The company has been building an enterprise SaaS platform to give customers a set of integrated business tools, but CEO and co-founder Girish Mathrubootham says they will be investing part of this money in R&D to keep building out the platform.

To that end, the company also announced today a new unified data platform called the “Customer-for-Life Cloud” that runs across all of its tools. “We are actually investing in really bringing all of this together to create the “Customer-for-Life Cloud,” which is how you take marketing, sales, support and customer success — all of the aspects of a customer across the entire life cycle journey and bring them to a common data model where a business that is using Freshworks can see the entire life cycle of the customer,” Mathrubootham explained.

While Mathrubootham was not ready to commit to an IPO, he said they are in the process of hiring a CFO and are looking ahead to one day becoming a public company. “We don’t have a definite timeline. We want to go public at the right time. We are making sure that as a company that we are ready with the right processes and teams and predictability in the business,” he said.

In addition, he says he will continue to look for good acquisition targets, and having this money in the bank will help the company fill in gaps in the product set should the right opportunity arise. “We don’t generally acquire revenue, but we are looking for good technology teams both in terms of talent, as well as technology that would help give us a jumpstart in terms of go-to-market.” It hasn’t been afraid to target small companies in the past, having acquired 12 already.

Freshworks, which launched in 2010, has almost 2,500 employees, a number that’s sure to go up with this new investment. It has 250,00 customers worldwide, including almost 40,000 paying customers. These including Bridgestone Tires, Honda, Hugo Boss, Toshiba and Cisco.

After selling enterprise biz, Docker lands $35M investment and new CEO

In what’s proving to be an interesting day for Docker, it announced it has received a $35 million investment from existing investors Benchmark Capital and Insight Partners.

It also announced the company has named long-time Chief Product Officer, Scott Johnston as CEO. Johnston is the third CEO at Docker this year, replacing Rob Bearden, who replaced Steve Singh after he stepped down in May.

The news came shortly after Mirantis had announced it had purchased Docker’s enterprise business. The moves are curious to say the least, but Johnston says that he still sees an opportunity for the company helping developers use Docker, the popular containerization engine that has struggled to find a business model.

“Specifically, we are investing in expanding our cloud services to enable developers to quickly discover technologies for use when building applications, to easily share these apps with teammates and the community, and to run apps frictionlessly on any Kubernetes endpoint, whether locally or in the cloud,” Johnston said in a statement.

Bearden said that the company decided to go in this direction after carefully studying its existing business models. “After conducting thorough analysis with the management team and the Board of Directors, we determined that Docker had two very distinct and different businesses: one an active developer business, and the other a growing enterprise business. We also found that the product and the financial models were vastly different. This led to the decision to restructure the company and separate the two businesses, which is the best thing for customers and to enable Docker’s industry-leading technology to thrive,” he said in a statement.

Prior to today’s announcement, the company had raised over $272 million, according to Crunchbase data. Now Benchmark and Insight are throwing it a $35 million lifeline to try one more time to build a successful business on top of the open source Docker project.

Salesforce Ventures invested $300M in Automattic while Salesforce was building a CMS

In September, Salesforce Ventures, the venture of arm of Salesforce, announced a hefty $300 million investment in Automattic, the company behind WordPress, the ubiquitous content management system (CMS). At the same time, the company was putting the finishing touches on Salesforce CMS, an in-house project it released last week.

The question is, why did it choose to do both?

One reason could be that WordPress isn’t just well-liked; it’s also the world’s most popular content management system, running 34 percent of the world’s 10 billion websites — including this one — according to the company. With Automattic valued at $3 billion, that gives Salesforce Ventures a 10 percent stake.

Given the substantial investment, you wouldn’t have been irrational to at least consider the idea that Salesforce may have had its eye on this company as an acquisition target. In fact, at the time of the funding, Automattic CEO Matt Mullenweg told TechCrunch’s Romain Dillet that there could be some partnerships and integrations with Salesforce in the future.

Now we have a Salesforce CMS, and a potential partnership with one of the world’s largest web content management (WCM) tools, and it’s possible that the two aren’t necessarily mutually exclusive.

AWS announces new savings plans to reduce complexity of reserved instances

Reserved instances (RIs) have provided a mechanism for companies, who expect to use a certain level of AWS infrastructure resources, to get some cost certainty, but as AWS’s Jeff Barr points out they are on the complex side. To fix that, the company announced a new method called Savings Plans.

“Today we are launching Savings Plans, a new and flexible discount model that provides you with the same discounts as RIs, in exchange for a commitment to use a specific amount (measured in dollars per hour) of compute power over a one or three year period,” Barr wrote in a blog post announcing the new program.

Amazon charges customers in a couple of ways. First, there is an on-demand price, which is basically the equivalent of the rack rate at a hotel. You are going to pay more for this because you’re walking up and ordering it on the fly.

Most organizations know they are going to need a certain level of resources over a period of time, and in these cases, they can save some money by buying in bulk up front. This gives them cost certainty as an organization, and it helps Amazon because it knows it’s going to have a certain level of usage and can plan accordingly.

While Reserved Instances aren’t going away yet, it sounds like Amazon is trying to steer customers to the new savings plans. “We will continue to sell RIs, but Savings Plans are more flexible and I think many of you will prefer them,” Barr wrote.

The Savings Plans come in two flavors. Compute Savings Plans provide up to 66% savings and are similar to RIs in this regard. The aspect that customers should like is that the savings are broadly applicable across AWS products, and you can even move work loads between regions and maintain the same discounted rate.

The other is an EC2 Instance Savings Plan. With this one, also similarly to the reserved instance, you can save up to 72% over the on-demand price, but with this option you are limited to a single region.  It does offer a measure of flexibility though allowing you to select different sizes of the same instance type or even switch operating systems from Windows to Linux without affecting your discount with your region of choice.

You can sign up today through the AWS Cost Explorer.

Neo4j introduces new cloud service to simplify building a graph database

Neo4j, a popular graph database, is available as an open source product for anyone to download and use. Its enterprise product aimed at larger organizations is growing fast, but the company recognized there was a big market in between those two extremes, and today it introduced a new managed cloud service called Aura.

They wanted something in the product family for smaller companies, says Emil Eifrem, CEO and co-founder at Neo4j . Aura really gives these smaller players a much more manageable offering with flexible pricing options. “To get started with an enterprise project can run hundreds of thousands of dollars per year. Whereas with Aura, you can get started for about 50 bucks a month, and that means that it opens it up to new segments of the market,” Eifrem told TechCrunch. As he points out, even a startup on a shoe-string budget can afford $50 a month.

Aura operates on a flexible pricing model, and offers the kind of value proposition you would expect from a cloud version of the product. The company deals with all of the management, security and updates for you. It will also scale as needed to meet your data requirements as you grow. The idea is to allow developers to concentrate on simply building applications and let Neo4j deal the database for you.

He says over time, he could see larger businesses, who don’t want to deal with the management side of developing a graph database application also using the cloud product. “Why would you want to operate your own database? You should probably focus on your core business and building applications to support that core business,” he said. But he recognizes change happens slowly in larger organizations, and not every business will be comfortable with a managed service. That’s why they are offering different options to meet different requirements.

Graph databases allow you to see connections between data. It is the underlying technology, for example, in a social networking app, that lets you the connection between people you know and people your friends know. It is also the technology on an e-commerce site that can offer recommendations based on what you bought before because people who buy a certain product are more likely to purchase other related products.

Workday to acquire online procurement platform Scout RFP for $540M

Workday announced this afternoon that it has entered into an agreement to acquire online procurement platform Scout RFP for $540 million. The company raised more than $60 million on a post valuation of $184.5 million, according to PitchBook data.

The acquisition builds on top of Workday’s existing procurement solutions, Workday Procurement and Workday Inventory, but Workday chief product product officer Petros Dermetzis wrote in a blog post announcing the deal that Scout gives the company a more complete solution for customers.

“With increased importance around the supplier as a strategic asset, the acquisition of Scout RFP will help accelerate Workday’s ability to deliver a comprehensive source-to-pay solution with a best-in-class strategic sourcing offering, elevating the office of procurement in strategic importance and transforming the procurement function,” he wrote.

Ray Wang, founder and principal analyst at Constellation Research says that Workday has been trying to be the end-to-end cloud back office player. He says, “One of their big gaps has been in procurement.”

Wang says that Workday has been investing with eye toward filling gaps in the product set for some time. In fact, Workday Ventures has been an investor in Scout RFP since 2018, and it’s also an official Workday partner.

“A lot of the Workday investments are in portfolio companies that are complimentary to Workday’s larger vision of the future of Cloud ERP. Today’s definition of ERP includes finance, HCM (human capital management), projects, procurement, supply chain and asset management,” Wang told TechCrunch.

As the Scout RFP founders stated in a blog post about today’s announcement, the two companies have worked well together and a deal made sense. “Working closely with the Workday team, we realized how similar our companies’ beliefs and values are. Both companies put user experience at the center of product focus and are committed to customer satisfaction, employee engagement and overall business impact. It was not surprising how easy it was to work together and how quickly we saw success partnering on go-to-market activities. From a culture standpoint, it just worked,” they wrote. A deal eventually came together as a result.

Scout RFP is a fairly substantial business, with 240 customers in 155 countries. There are 300,000 users on the platform, according to data supplied by the company. The company’s 160 employees will be moving to Workday when the deal closes, which is expected by the end of January, pending standard regulatory review.

New Relic snags early stage serverless monitoring startup IOpipe

As we move from a world dominated by virtual machines to one of serverless, it changes the nature of monitoring, and vendors like New Relic certainly recognize that. This morning the company announced it was acquiring IOpipe, an early-stage Seattle serverless monitoring startup to help beef up its serverless monitoring chops. Terms of the deal weren’t disclosed.

New Relic gets what it calls “key members of the team,” which at least includes co-founders Erica Windisch and Adam Johnson, along with the IOpipe technology. The new employees will be moving from Seattle to New Relic’s Portland offices.

“This deal allows us to make immediate investments in onboarding that will make it faster and simpler for customers to integrate their [serverless] functions with New Relic and get the most out of our instrumentation and UIs that allow fast troubleshooting of complex issues across the entire application stack,” the company wrote in a blog post announcing the acquisition.

It adds that initially the IOpipe team will concentrate on moving AWS Lambda features like Lambda Layers into the New Relic platform. Over time, the team will work on increasing support for Serverless function monitoring. New Relic is hoping by combining the IOpipe team and solution with its own, it can speed up its serverless monitoring chops .

As TechCrunch’s Frederic Lardinois pointed out in his article about the company’s $2.5 million seed round in 2017, Windisch and Johnson bring impressive credentials.

“IOpipe co-founders Adam Johnson (CEO) and Erica Windisch (CTO), too, are highly experienced in this space, having previously worked at companies like Docker and Midokura (Adam was the first hire at Midokura and Erica founded Docker’s security team). They recently graduated from the Techstars NY program,” Lardinois wrote at the time.

The startup has been helping monitor serverless operations for companies running AWS Lambda. It’s important to understand that serverless doesn’t mean that there are no servers, but the cloud vendor — in this case AWS — provides the exact resources to complete an operation and nothing more.

IOpipe co-founders Erica Windisch and Adam Johnson

Photo: New Relic

Once the operation ends, the resources can simply get redeployed elsewhere. That makes building monitoring tools for such ephemeral resources a huge challenge. New Relic has also been working on the problem and released New Relic Serverless for AWS Lambda offering earlier this year.

IOpipe was founded in 2015, which was just around the time that Amazon was announcing Lambda. At the time of the seed round the company had eight employees. According to Pitchbook data, it currently has between 1 and 10 employees, and has raised $7.07 million since its inception.

New Relic was founded in 2008 and raised over $214 million, according to Crunchbase, before going public in 2014. Its stock price was $65.42 at the time of publication up $1.40.