February 04, 2022
February 04, 2022
Contributor: Craig Rosenberg and Dan Gottlieb
There’s an unprecedented amount of venture capital funding and merger and acquisition (M&A) activity.
A robust tech stack is essential to running a modern and efficient revenue-generating organization. However, prioritizing technologies to invest in is challenging, especially in this period of “sales tech mayhem,” where the vendor market is moving from a wide set of categories to a narrow list of vendors with wide portfolios of capabilities.
Download now: Why You Must Audit Your Sales Tech Stack
Besides auditing the value of your revenue tech stack, the best way to tame the mayhem is to continually monitor the vendor landscape, especially as mergers and acquisitions consolidate providers. To help, we outline recent activity in this space as of Q421.
The term “unicorn” refers to any startup that reaches a valuation of $1 billion. The newest unicorn to keep an eye on is Drift. Although it is primarily considered a martech unicorn, Drift has significant traction with the sales function. Another new entrant is PandaDoc, which raised its Series C in September 2021, and joins the roster of eight other recent sales tech unicorns: Clari, Gong, Highspot, Mindtickle, Outreach, People.ai, Salesloft and Seismic; plus, sales/marctech unicorns Drift and 6Sense. Unicorns are seeing relentless growth, and there’s no doubt more will earn this status in the near future.
Alpha platforms — hyperaggressive vendors that are broadening capabilities at breakneck speed — continue to roam the landscape and eat everything they can. Alpha platforms aren’t acquiring their direct competitors; rather, they are buying into adjacent categories. Here’s a breakdown of new activity:
Relative to the overall sales category, which saw 10.9% growth in 2021, sales enablement is a high-growth segment within the overall category. There are now four unicorns in the sales enablement market: Mindtickle, Highspot, Seismic and Gong. The move to virtual/hybrid selling has been a key driver of their growth. Ninety-four percent of organizations have invested or are considering investing in technology to enable virtual selling (so, basically everybody) — not to mention, 68% of organizations are inventorying their tools or technologies every year.
Although not as active as some other types of vendors, CRM alpha Salesforce recently acquired sales enablement vendor LevelJump. This could spark a run of sales-tech acquisitions by CRM vendors in the near future. Salesforce jumping in will accelerate an already surging sales enablement market.
Venture capitalists are circling around the demo/product experience space thanks to the increasingly popular storytelling approach to selling. Great demos are opportunities to tell great stories about a solutions’ functionality. And the good news? Buyers are favorable to demos. According to the Gartner Technology Buying Dynamics B2B Technology Buyers Survey, 50% of buyers cite demos as one of the most valuable parts of the buying cycle. Fifty-eight percent list “demonstrations” as a call to action they would respond to in a marketing campaign. The demo/product experience market also serves “traditional” sales, where the demo is a critical play in the sales process. Early vendors in this space include Demostack, Navattic, Reprise, Tourial and Walnut.
In this landscape, 60% of a market can be acquired before the market itself even exists. Example use case: mutual action plans.
A mutual action plan is an agreement that a salesperson and prospect enter into that outlines the milestones they must complete to close a deal and deploy a solution. This plan captures the mutually agreed-upon set of next steps with dates working backward from deal signing or implementation (depending on the solution). By assigning accountability and ownership to all stakeholders and creating a shared commitment to move toward a deal, the plan enables both sides to anticipate misunderstandings and challenges.
When done right, mutual action plans help run a buying process and act as a litmus test of whether a deal is “real.” The problem? They are manual, not standardized, and lack collaboration. A batch of very small startups rose to address this issue through tech-enabled mutual action plans. Now, only two stand-alone vendors remain: Accord and Recapped. Almost instantly, Clari acquired DealPoint, Outreach acquired Sameplan and People.AI acquired ClosePlan.
A version of this story originally appeared on the Gartner Blog Network.
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Recommended resources for Gartner clients*:
Infographic: The Revenue Tech Stack
Market Guide for Revenue Intelligence Platforms
Cool Vendors in Conversation Intelligence for B2B Sales
*Note that some documents may not be available to all Gartner clients.