Salesforce recently closed a record-breaking $6.5 billion acquisition deal with MuleSoft, a cloud-based iPaaS application. According to analysts at Raymond James, the company was bought for 16 times their expected 2018 revenue. So why was Salesforce, one of the global leaders in CRM software, so interested in MuleSoft?

iPaaS Defined

iPaaS, also known as Integration Platform as a Service, is a suite of cloud services enabling development, execution, and governance of integration flows connecting any combination of on-premises and cloud-based processes, services, applications, and data within the individual or across multiple organizations.

Salesforce and other cloud technology companies were interested in MuleSoft for its highly adaptive capabilities. There is speculation that the deal was inflated due to a potential bidding war, but nonetheless, the technology is innovative and seen as the future of software integration and management.

Many at Salesforce believe that their strongest potential for growth lies in diversifying their software offerings and expansion outside their current market. MuleSoft’s existing client base will also help Salesforce expand into targeted sectors including government agencies, healthcare, and financial services.

The company says that MuleSoft will help it create an “Integration Cloud” service that combines in-house corporate computing with data and apps from the internet.

Integration middleware has traditionally been used by companies to link software but now iPaaS offers users faster integration times, a subscription payment model, and the multi-tenant aspect to the software allows for more collaboration and exchange. iPaaS also takes care of deployment, management, troubleshooting, and maintenance of the platform.

The extensive software is able to complete all types of functions including synching customer records between two different cloud-based software, sending orders from a cloud-based software to an on-site application like SAP, or extracting sales data from an application onto the on-site data warehouse.

iPaaS – The Key to Next Generation Technology

This disruption will bridge the gap between companies who are reluctant to leave their traditional on-premise technology for the cloud-based software that Salesforce offers. More mergers and acquisitions outside of the purchasing company’s direct industry will enable growth, innovation, and collaboration. Creating a cohesive flow between all the internal and external applications and technologies used in an organization drives business development and efficiency.

Industry 4.0, the internet of things, and artificial intelligence are all buzzwords when it comes to the growing tech-centered world. These movements are pushing for a greater need for data governance, management, and connectivity, making MuleSoft and similar iPaaS companies crucial for the next stage of innovation.

iPaaS makes the process of integration much faster and simpler while encompassing all combinations of possible integration. Its flexibility, connectivity, and speed are what make it such an innovative development in software management and a solution for companies juggling multiple different software programs or who are reluctant to switch systems completely.

Co-author and contributions by Emily Brice.