Last week, Genesys announced $1.5BN in new funding from ServiceNow and Salesforce, with each company agreeing to invest $750MN.
Proceeds will go toward repurchasing shares from the company’s existing equity holders.
However, contrary to some reports, it’s not only that. Genesys will also use the funds to “build on” its unified CCaaS-CRM solutions it has developed with both companies.
With this, several questions arise: Where does Genesys fit into the broader vision of ServiceNow and Salesforce? Will the CRM giants now favor Genesys over other market players? And, what does this mean for Genesys’s reported IPO bid?
The following three hot takes consider all these questions (and others!).
HOT TAKE #1 – Genesys Becomes a Critical Part of the Agentic Story
There’s clear competition between Salesforce and ServiceNow, each vying to deliver an enterprise-wide AI agent platform.
On their journey to implement those AI agents, many organizations are starting in the contact center.
Both Salesforce and ServiceNow recognize this and the potential to automate complex customer issues, beyond the reach of traditional self-service.
Ultimately, that’s not just a matter of packaging their CRM solutions with preconfigured agents. CCaaS providers will also play a key role in enterprises, especially those with robust voice and orchestration capabilities.
Genesys fits the bill and leads the market in its earnings. Earlier this year, it became the first tech provider to surpass $3BN in annual recurring CCaaS revenue.
By pulling closer to ServiceNow and Salesforce while pushing its voice and orchestration solutions, Genesys can feed into the broader agentic AI story.
That’s according to Rebecca Wetteman, CEO & Principal Analyst at Valoir. She told CX Today:
Genesys is in a great position. This gives them some liquidity for investors and funding for future product development. It’ll be interesting to see how this “situationship” plays out.
That situationship may mean Genesys walking a fine line between Salesforce and ServiceNow.
However, by investing the same amount, both tech giants signal: “We’re both serious, but we’re not going all the way and acquire this company.”
In other words, “We’re even!”
As for the investors that Wetteman noted, some may choose now to exit, which is likely favorable to the IPO route, given the current market uncertainty.
HOT TAKE #2 – Genesys Gets Its Just Rewards for Investing in Tighter CCaaS-CRM Integrations
Genesys was the first CCaaS provider to announce CCaaS-CRM integrations with ServiceNow and Salesforce that not only embedded voice directly into the CRM but also digital channels, routing, and even workforce optimization tooling.
Others have followed suit, with AWS, Five9, and Vonage since making similar announcements.
However, Genesys originally put considerable resources into these relationships, setting up co-innovation teams and engaging with hundreds of shared customers.
In doing so, it gained feedback on how their platforms could function better together and ultimately delivered coordinated dashboards, unified channels, and a single real-time data fabric.
All this involved more than plugging solutions into the CRM.
Instead, Genesys matched a $580MN funding round in December 2021, which Salesforce and ServiceNow also contributed to, with market foresight. Now, per Liz Miller, VP & Principal Analyst at Constellation Research, it’s reaping the rewards.
“We’ve all seen big companies partner with smaller players and underestimate the effort it takes to make those partnerships functional,” said Miller. “But Genesys put in the work, talent, innovation, and time to make it happen.
If you talk to both ServiceNow and Salesforce, they’ll tell you: Genesys made the heavy investment to ensure those connectors really worked, map the data, go beyond just an API call.
To Miller’s point, these are out-of-the-box, reliable unified solutions. In this sense, the investment feels like a recognition: “You did a great job. Now let’s see what round two looks like.”
HOT TAKE #3 – Genesys Sets a Course for Future CCaaS-CRM Integrations
Despite the massive investment, ServiceNow and Salesforce have tight partnerships with other major CCaaS players.
For example, in recent months, ServiceNow announced a co-innovation relationship with NiCE, and Salesforce launched a new offering with AWS. Both have also cozied up with Five9.
However, neither has splashed so much cash on a CCaaS provider until now.
As such, the investment raises an important question: Will ServiceNow and Salesforce start pushing the Genesys integration more aggressively than others?
While some may debate this, it seems unlikely, as both vendors have long strived to avoid playing favorites.
What the investment may do, however, is allow Genesys to collaborate more closely with the enterprise tech juggernauts and set a course for the future of CCaaS-CRM integrations that aligns with its own internal vision.
As such, it may lead on future integrations and gain attention by bringing new integrations to the market first.
While ServiceNow and Salesforce will keep working with others, they may become stuck playing catch-up and, ultimately, follow Genesys’s direction.
Of course, that’s unless rival vendors can provide an alternative vision that resonates with both CRM giants, like Genesys has. So, over to you, CCaaS players!
Wetteman & Miller discussed the news with three other prominent analysts during an episode of CX Today’s Big News Update, which will soon go live. The industry experts also considered the recent NiCE-Cognigy takeover, Salesforce-Bluebirds acquisition, and Five9 CEO departure.
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