CEO Marc Benioff offers his perspective on losing the chance to buy LinkedIn and Twitter

Marc Benioff is the chief executive of Salesforce.com Inc., a software company whose deal making has been in the headlines in recent months.

Earlier this year, Salesforce lost a bidding war for the professional networking site LinkedIn to rival Microsoft Corp., and then it walked away from a possible acquisition of Twitter Inc. amid opposition from shareholders. More recently, The Wall Street Journal reported on the details of an internal Salesforce review of 14 possible takeover targets that came from leaked emails.

Mr. Benioff sat down with Wall Street Journal Financial Editor Dennis Berman to discuss these and other topics. Edited excerpts follow.

Call for scrutiny

MR. BERMAN: You were a bidder for LinkedIn but lost out to Microsoft. When you sat with your board and said, "Guys, we've got to spend a lot of money on this thing," what was the vision?

MR. BENIOFF: Our vision for LinkedIn was I think very different than Microsoft's. We really liked some of the business fundamentals.

There are [some similarities between LinkedIn's business model and ours] that we would have amplified. And that's what I was really excited about, that I could see right away I could provide immediate value to our shareholders by acquiring it.

That's different than what Microsoft is saying. They're saying that they're going to commingle their data stream and LinkedIn's data stream to create a product that will create a barrier to entry for other companies.

And that's when I said, "Hold on. The last time I checked, that was illegal. So somebody should at least look at that."

MR. BERMAN: So you filed a complaint in Europe, right?

MR. BENIOFF: Not just us. We've been joined by dozens of other software companies.

MR. BERMAN: Do you think you have any chance of stopping it? Does the government understand the nuances you're describing?

MR. BENIOFF: I think that European government and the European regulator and the competition commissioner have said that they are extremely sensitive to how companies are using data, especially in Europe. And specifically to Microsoft and LinkedIn, they've indicated that they are going to use their data as a competitive weapon against other software companies. Now, that's fine for most companies to say. But when you're the largest software company in the world, you're different. You have to be treated differently.

MR. BERMAN: I know you were upset when your interest in acquiring Twitter leaked out. Your shareholders didn't like it and you walked away, but what was your vision for how it might have fit in?

MR. BENIOFF: We had a very exciting vision of what we would do with Twitter, and that's why we were involved. We've done about 40 acquisitions and never had a deal leak before. But all of a sudden, the [Twitter] deal leaked and the stockholders were like, "Hold on, we like what's going on with Salesforce. We like your core. What are you doing? Stop."

We had to stop because I'm running the business in partnership with my shareholders. And if you aren't running your company in a collaborative way, you're going to get into trouble.

Airing laundry

MR. BERMAN: Your internal laundry was aired once again when emails from Colin Powell, who sits on Salesforce's board, were made public. And as much as I had kind of a prurient interest in what goes on inside a company like Salesforce, there was somethingto me that felt kind of wrong. Like, I shouldn't be reading these emails.

MR. BENIOFF: Right. But you did. And you put them on the front page.

So let's talk about that. We obviously have nothing to hide because it's all in the public domain. Our most sensitive, most complex issues, they're all in the public domain. So if you want to understand Salesforce, it's all right there on the front page of The Wall Street Journal.

And the reality is we run a very clean ship. That's one of the reasons our stockholders actually were gladdened when they saw those documents.

They said, "Wow, they actually have a really measured, thoughtful process around all these things."

MR. BERMAN: Let's move to the future. In a lot of ways, the future is artificial intelligence. You are putting AI directly into your products. It's called Einstein.

MR. BENIOFF: AI is an amazing technology. It's going to be transformational to our industry. But you have to be ready to be able to say, "What is your unique value proposition when it comes to this technology?"

The power of Einstein is that it's built right into the core Salesforce platform.

Some of our hundreds of thousands of customers are programmers but the vast majority are not. They want to be able to take the power of machine intelligence, machine learning, AI, all aspects of it and bring it in to their customer data and get these incredible insights out of it.

Our job is to make that so easy that anybody can do it. That's different.

Write to reports@wsj.com

(END) Dow Jones Newswires

October 31, 2016 02:48 ET (06:48 GMT)

Copyright (c) 2016 Dow Jones & Company, Inc.