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This seems like a lot to pay for company that isn't cashflow positive. Even if we take out 147 million they spend for sales for synergy reasons. Keep the growth rate similar. We end up with FCF of 200 mil. That is paying something like 15x FCF using some crazy assumptions.

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Does seem like quite a lot for a software company. Could hire quite a few devs with a billion dollars. I imagine most of the price could be attributed to Demandware's existing customer relationships and Demandware's employees, although the latter is difficult to value especially considering that most folks worth their salt are out as soon as their options vest.

Does Salesforce pursue the same model of customer acquisition as Oracle does? I know Oracle is known to sell to existing customers additional products & services, so Salesforce might be "acquiring" new customers if there is little overlap in current customer base.

It seems highly unlikely this sort of acquisition is for the technology alone.

Most of the Salesforce purchases seem to be about opening up new marketing channels.

Perhaps Benioff knows something the rest of us don't about the long-term potential. That or he had the money burning a hole in his pocket and had to spend it on something...

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