As the reality of a current and future world where B2B buying and selling largely takes place in remote and digital formats sets in, sellers must evolve their skill sets, sales leaders must reimagine their go-to-market strategies, and sales enablement providers must increase the value they deliver to their customers. The pace of COVID-induced trends is like nothing we have seen before. Microsoft CEO Satya Nadella summed it up best in the company’s Q3 earnings call: “We have seen two years’ of digital transformation in two months.”
Since 41% of B2B sales leaders say top-line growth is their first priority and 38% say cost reduction is next, sales tech providers are under more pressure than ever to extend the value they deliver to their customers.(1) Earlier this month, sales content (SC) provider Seismic announced its intention to acquire the Toronto–based sales social engagement company, Grapevine6, and on Wednesday, December 9, Allego, a Boston-based sales readiness company, announced that it had acquired Refract, a UK-based conversation intelligence (CI) firm.
With their consumerlike user interfaces, sales readiness (SR) solutions help sales enablement teams boost seller skills through video-based role–plays, coaching, and microlearning tasks and foster healthy competition and collaboration through gamification and workflows. Conversation intelligence solutions record remote conversations between buyers and sellers, use natural language processing to transcribe those conversations, and an AI engine to analyze and derive insights from those conversations, which can then be shared with reps, managers, and business leaders.
With sellers working outside of the office setting, digital-based coaching and automated data capture are necessary both for seller development and management visibility. In 2021, as CI functionality becomes core to SR and sales engagement (SE) platforms, we will likely see more CI point-solution provider pickups as others get left behind.
With the acquisition of Refract, Allego puts itself in a good position to extend capabilities for its existing customers. And in the future, if it can acquire deep SC and SE functionalities, Allego can become a legitimate player in the burgeoning sales enablement automation category. In today’s remote selling environment, conversation intelligence is now becoming a table-stakes source of data as sales enablement teams look to arm their sellers with a full package of digital tools. This acquisition is part of a growing trend of sales tech consolidation that we predict will accelerate into 2021 as tech buyers demand more end-to-end solutions.
Although Allego Cofounder and CEO Yuchun Lee is no stranger to deal-making, this is the first acquisition the firm has made since it was founded in 2013. While other players in the sales enablement space have moved faster to secure funding, acquire companies, and extend partner ecosystems, Lee has been much more measured in his approach. To date, Allego has focused on organic growth and has been quiet about where it gets its capital. In 2018, Allego raised $8 million from General Catalyst and has reported that the company has been cash–flow positive from January through September of 2020. The company just disclosed it will close another and more sizable round in early 2021.
The race is on. Who’s up next?
(1) Forrester Analytics Business Technographics® Marketing Survey, 2020