When: Today, February 28, 2018
Where: CNBC's "Mad Money with Jim Cramer"
The following is the unofficial transcript of a CNBC interview with Salesforce CEO Marc Benioff and CNBC's Jim Cramer on CNBC's "Mad Money" today, February 28, 2018. Following are links to video from the interview on CNBC.com: https://www.cnbc.com/video/2018/02/28/crms-benioff-20-billion-revenue-target-just-became-that-much-more-attainable.html?play=1 & https://www.cnbc.com/video/2018/02/28/salesforce-ceo-marc-benioff-bullish-on-20-billion-revenue-target.html?play=1.
All references must be sourced to CNBC.
JIM CRAMER: NOW EARLIER TODAY, I GOT A CHANCE TO CHECK IN WITH MARC BENIOFF, HE'S THE VISIONARY, CO-FOUNDER, CHAIRMAN AND CEO OF SALESFORCE, FROM ITS NEW NEW YORK HEADQUARTERS. SO TAKE A LOOK.
JIM CRAMER: MARC, I EXPECTED A GOOD QUARTER. THIS IS ACTUALLY A BLOWOUT. AND THAT I USUALLY DON'T GET FROM A COMPANY YOUR SIZE. HOW DID THAT HAPPEN?
MARC BENIOFF: FIRST OF ALL, I WANT TO WELCOME YOU TO OUR ALL NEW SALESFORCE TOWER NEW YORK CITY. HERE WE ARE IN OUR BIGGEST MARKET IN THE WORLD, NEW YORK. AND WE'RE THRILLED TO HAVE OUR NEW YORK TOWER HERE IN BRYANT PARK. IT'S VERY EXCITING.
CRAMER: AND YOU CAN CELEBRATE WITH THESE NUMBERS.
BENIOFF: I'M CELEBRATING WITH THE NUMBERS. UNBELIEVABLE.
CRAMER: I'M LOOKING AT 48% UNBILLED DEFERRED REVENUE. I MEAN, THESE ARE WHAT I EXPECT FROM A SMALL COMPANY. OBVIOUSLY YOU'VE BLOWN RIGHT THROUGH.
BENIOFF: IT WAS A BLOWOUT QUARTER, JIM. YOU CAN SEE THE NUMBERS ARE—
BENIOFF: WHEN WAS THE LAST TIME YOU HAD THIS MAGNITUDE?
BENIOFF: YEARS AGO.
CRAMER: AND HOW QUICKLY ARE NOW YOU ON YOUR GOAL TOWARD 20 BILLION, WHICH WE THOUGHT WAS FANCIFUL AT FIRST?
BENIOFF: WELL, LET'S CELEBRATE FIRST THE PRESENT MOMENT, WHICH IS THAT WE JUST BLEW THROUGH THE 10 BILLION DOLLAR NUMBER FASTER – NOT JUST FASTER THAN ANY OTHER CLOUD COMPANY BUT FASTER THAN ANY OTHER SOFTWARE COMPANY IN HISTORY.
CRAMER: THESE ARE – THIS IS A NUMBER I DO EXPECT FROM A COMPANY WITH BILLION DOLLARS IN SALES.
BENIOFF: AND I THINK THAT BECAUSE OF THIS INCREDIBLE QUARTER YOU ARE GOING TO SEE US REALLY HAVE A HUGE DREAM OF GETTING TO 20 BILLION FASTER THAN ANY OTHER SOFTWARE COMPANY EVER.
CRAMER: LOOK, SOMETIMES THERE IS A MAGNITUDE THAT TAKES YOUR BREATH AWAY. YOU ARE IN NEW YORK, IT'S NEW, IT'S BIG, BUT I SEE EUROPE. I SEE EUROPEAN FOOTPRINTS ALL OVER THESE NUMBERS.
BENIOFF: EUROPE IS HUGE FOR US. AND YOU CAN SEE THAT IN SOME OF THESE SPECTACULAR CUSTOMERS THAT WE'RE SIGNING IN EUROPE. OF COURSE YOU KNOW THE ADIDAS STORY. IF YOU HAVE BEEN TO ADIDAS.COM AND BOUGHT YOUR YEEZY 350'S, YOU KNOW THAT IT IS ALL SALESFORCE. IF YOU'RE ON ADIDAS.COM, IT'S ALL SALESFORCE. IF YOU GET AN E-MAIL FROM ADIDAS, IT'S SALESFORCE. IF YOU GO INTO AN ADIDAS STORE AND TALK TO A SALES REP IN PERSON, THAT'S SALESFORCE. AND WE'RE BUILDING A SINGLE VIEW OF THE CUSTOMER FOR ADIDAS. AND THAT'S GIVING THEM THE ABILITY TO SELL AND CONNECT TO THEIR CUSTOMER IN A WHOLE NEW WAY.
CRAMER: THE BANKS ARE CATCHING UP. I UNDERSTAND BBVA WHICH IS A BRILLIANT BANK HAS ADOPTED YOUR – WHY? IS IT DIFFERENTIATION IN CUSTOMER?
BENIOFF: WELL YOU KNOW OUR FINANCIAL SERVICES CLOUD, WHICH IS A PRODUCT BUILT SPECIFICALLY FOR THE BANKING INDUSTRY AND HAS BEEN SO SUCCESSFUL HERE IN THE UNITED STATES WITH GREAT CUSTOMERS LIKE BANK OF AMERICA AND WELLS FARGO AND OTHERS, WELL NOW YOU CAN SEE THE EUROPEAN BANKS INCLUDING BBVA, EVEN DEUTSCHE BANK DOING AMAZING THINGS WITH OUR FINANCIAL SERVICES CLOUD SO THAT'S BEEN EXCITING. BUT IT'S NOT JUST BANKING, JIM. ALSO I AM THRILLED WITH SOME OF THE OTHER EUROPEAN INDUSTRIAL COMPANIES, AND LOOK AT SIEMENS, WE'RE THEIR NEW CRM STANDARD, AND LOOK AT THE INCREDIBLE SUCCESS WE'VE HAD WITH ABB. I LOVE ABB. I DON'T KNOW IF YOU'VE SEEN THE ROBOTS. THE INCREDIBLE FAST CHARGING SYSTEMS THAT THEY HAVE WITH BUSSES, ELECTRIC BUSSES. BUT, YOU KNOW ALL OF THESE COMPANIES ARE TRYING TO FOCUS ON AND CONNECT WITH THEIR CUSTOMERS. AND THE ROBOT EXAMPLE IS A GREAT EXAMPLE. YOU KNOW, WHEN ABB USED TO SHIP THEIR ROBOTS, WELL THEY SHIPPED THE ROBOTS. AND THEY ENDED UP IN THE FACTORIES. THEY WEREN'T CONNECTED. NOW, OF COURSE THEY'RE CONNECTED WITH THE ROBOTS, THEY KNOW IF A ROBOT IS GOING TO FAIL.
CRAMER: AND THIS FELLOW OVER HERE - EINSTEIN.
BENIOFF: WELL, EINSTEIN IS A HUGE PART OF THAT STORY, BECAUSE IT'S ABLE TO DETERMINE FOR ABB, HEY – THIS ROBOT IS GETTING READY TO FAIL, ROLL YOUR SERVICE CHECK, SEND THAT SERVICE TECHNICIAN AND MAKE SURE THAT ROBOT GETS FIXED. AND ABB CAN DO THAT WITH SALESFORCE.
CRAMER: BUT LET'S BACK UP FOR A SECOND. THERE'S A -- MUST BE A LOT OF MILLION DOLLAR CONTRACTS.
BENIOFF: MORE THAN EVER.
CRAMER: MAGNITUDE AGAIN. MORE THAN EVER. ALRIGHT. FAIR ENOUGH. SOME CUSTOMERS THIS MORNING, LOWES REPORTED, LOOKS LIKE THEY'RE LOSING SHARE, CONTRACTOR SHARE WHICH IS A BIG TICKET TO HOME DEPOT. WE'VE TALKED ABOUT HOME DEPOT. IN TOUCH WITH CUSTOMER CONTRACTOR, WWHERE THE MONEY IS MADE. YOU.
BENIOFF: WELL, CRAIG IS DOING AN AMAZING JOB AS CEO. THAT'S NUMBER ONE. BUT ALSO, WHAT I LOVE ABOUT HOME DEPOT IS THEY ARE REALLY FOCUSSED ON THEIR CUSTOMER AND WE HAVE REALLY BEEN THERE WITH THEM. IT'S A PARTNERSHIP IN THE TRANSFORMATION AND THEY KNOW WHO THEIR CUSTOMER IS WHICH NOT JUST THE CONSUMER, WHICH IS OF COURSE – I'M A HUGE HOME DEPOT CONSUMER MYSELF,
CRAMER: I AM TOO.
BENIOFF: BUT ALSO A CONTRACTOR. I'M NOT A CONTRACTOR, MAYBE I SHOULD BE WITH ALL THE HUGE HOME GROWTH GOING ON, BUT THIS IDEA THAT ALL THESE CONTRACTORS ARE OUT THERE – WELL THEY'RE MORE CONNECTED TO THE CONSUMER, THE CONTRACTOR AND THEY'VE BROUGHT THE EMPLOYEE IN AS WELL TO HAVE AN ADVISORY RELATIONSHIP WITH THESE TWO KEY STAKEHOLDERS IN THEIR BUSINESS. WOW IT'S BEEN AN ACCELERANT FOR THEM AND YOU CAN SEE SAME STORE SALES ACROSS THE BOARD. EVERYTHING WITH HOME DEPOT IS AMAZING. I CAN'T BELIEVE THEIR NUMBERS.
CRAMER: INVISALINE, NEW CUSTOMER OBVIOUSLY. THE SELFIE GENERATION. I THOUGHT THEY KNEW WHO THEIR CUSTOMER WAS. MAYBE THEY TOO HAVE TO BE MORE DIGITALIZED.
BENIOFF: I LOVE INVISALINE. I'M THINKING ABOUT GETTING BRACES MYSELF JUST BECAUSE OF THIS DEAL.
CRAMER: RIGHT. NOW I'VE GOT TO TALK ABOUT SOME SOCIAL RESPONSIBILITY, NOT JUST 1-1-1 WHICH YOU PIONEERED, BUT YOU HAVE BEEN A VOCAL OF LATE TALKING ABOUT THE NEED TO BE CAREFUL FOR TECHNOLOGY, FOR TECHNOLOGY TO BE CAREFUL BOTH BECAUSE OF THE FOURTH INDUSTRIAL REVOLUTION, A TERM THAT YOU PIONEERED, BUT ALSO BECAUSE OF A CONSCIOUSNESS THAT YOU HAVE TO RECOGNIZE THAT YOU HAVE RESPONSIBILITY. THAT FACEBOOK IS NOT JUST A GREYHOUND BUS THAT CARRIES EVERYBODY. THAT THESE COMPANIES BETTER START WAKING UP TO THE IDEA THAT THEY PLAY A ROLE OR THE GOVERNMENT IS GOING TO PLAY THE ROLE FOR THEM.
BENIOFF: WELL I THINK YOU'RE 100% RIGHT. YOU CAN SEE THAT IN TECHNOLOGY'S ADVANCEMENTS. AND THE ADVANCEMENTS IN TECHNOLOGY, IT'S NOT JUST IN CUSTOMER RELATIONSHIPS AND MANAGEMENT WHICH WE'VE BEEN TALKING ABOUT, BUT ARTIFICIAL INTELLIGENCE AS WELL. NOW THAT IMPACTS OUR CUSTOMERS BUT THAT IMPACTS THE WHOLE INDUSTRY. AND IT IS GOING TO TAKE A STRONG HAND AND THAT IS THE CEOs AND THESE COMPANIES HAVE TO TAKE RESPONSIBILITY FOR THE TECHNOLOGY THAT THEY ARE BUILDING. IS IT ADDICTIVE? IS THIS TECHNOLOGY HELPING THEIR CUSTOMERS OR HURTING THEIR CUSTOMERS? ARE THEY BEING MANIPULATED? THIS IS SOMETHING THAT EVERY COMPANY AND EVERY CEO IS GOING TO HAVE TO DO. AND AS WE BUILD THESE GREAT PLATFORMS AND AS EVERY COMPANY GOES THROUGH THEIR DIGITAL TRANSFORMATION, WELL WHEN THAT DIGITAL TRANSFORMATION HAPPENS, GUESS WHAT, YOU BETTER BE PAYING ATTENTION TO HOW THIS IS ALL COMING TOGETHER.
CRAMER: OK, SO THE CUSTOMER MATTERS. BUT IF YOU ARE TRYING TO GET GREAT GROSS MARGINS, WHICH FACEBOOK MUST MAINTAIN, IS THE CUSTOMER SACRIFICED? ARE THEY FINALLY RECOGNIZING – AND I DON'T MEAN TO PICK ON FACEBOOK, THEY'RE FINE, BUT TWITTER, WE CAN TALK ABOUT. DO THEY RECOGNIZE THAT IF THE CUSTOMER IS THE PERSON THAT MATTERS AND THE PRODUCT'S FAITH AND TRUTH MATTERS THAT THEY MAY HAVE A FAILED BUSINESS MODEL, EVEN THOUGH THEY'RE THE FASTEST GROWERS IN THE WORLD OTHER THAN YOUR COMPANY?
BENIOFF: EVERY CEO HAS TO DECIDE IF THEY ARE GOING TO LEAD WITH VALUES. AND WHAT ARE THERE VALUES. WHAT IS YOUR MOST IMPORTANT VALUE?
CRAMER: -- DON'T THEY?
BENIOFF: I MEAN THEIR TRUST IS OUR HIGHEST VALUE AT SALESFORCE. AND SO WHEN I AM THINKING ABOUT MY LEADERSHIP AS A CEO, IF TRUST IS NOT MY HIGHEST VALUE ESPECIALLY UNDER THE GUISE OF THIS AMAZING NEW TECHNOLOGY, AND ALL THE CHANGES ITS BRINGING MY CUSTOMERS OR MY CONSUMERS, THEN HOW AM I LEADING? AND EVERYBODY HAS TO ASK THAT QUESTION, WHAT IS THE MOST IMPORTANT THING TO YOU? LOOK, IF EVERYTHING IS IMPORTANT, JIM NOTHING IS IMPORTANT. YOU KNOW I BELIEVE THAT STRONGLY. WHAT IS THE MOST IMPORTANT THING TO YOU AS CEO? AND FOR US AT SALESFORCE IT IS TRUST. AND FOR COMPANIES THAT AREN'T LEADING WITH TRUST, I THINK THEY'RE GOING TO PAY A TERRIBLE PRICE. AND YOU CAN SEE THAT. WE HAVE GREAT EXAMPLES ACTUALLY. IF WE WERE BACK IN SAN FRANCISCO, WE COULD ROLL DOWN THE STREET AND YOU'LL SEE COMPANIES WHERE CEOs AREN'T THERE ANYMORE. GREAT COMPANIES. BECAUSE THEY WEREN'T LEADING WITH TRUST.
CRAMER: YOU TALKED ABOUT UBER, LOOK, WITH THE IDEA OF FASTEST GROWTH. LOOK, I WANT YOUR GROWTH. TO RECOMMEND YOUR STOCK, I WANT YOUR GROWTH. BUT – AND IT NEEDS TO BE SUSTAINABLE GROWTH. WE TALKED ABOUT PAUL POLMAN AT UNILEVER. SUSTAINABLE GROWTH. THESE ARE PEOPLE WHO GET IT. IF THEY ARE GOING TO WIN IN THIS WORLD – THE GROWTH SUSTAINABILITY COMES FROM TRUTH OF PRODUCT. IS THAT BECAUSE THERE'S SOME SORT OF NEW TRANSPARENCY? THE SMARTER PEOPLE? THE YOUNGER PEOPLE? WHY?
BENIOFF: THERE ARE THREE THINGS YOU NEED FOR SUSTAINABLE GROWTH. NUMBER ONE IS CUSTOMER FOCUS, WE'VE TALKED ABOUT THAT. THE SECOND KEY THING YOU THAT NEED FOR SUSTAINABLE GROWTH IS A CONNECTION WHO IS YOUR COMMUNITY? WHO ARE YOUR KEY STAKEHOLDERS? IS ANOTHER WAY TO SAY IT. OF COURSE IT'S YOUR SHAREHOLDERS, YOUR CUSTOMERS, YOUR PARTNERS, BUT IT'S ALSO – YOUR PUBLIC SCHOOLS, WE'VE TALKED ABOUT THAT, YOUR COMMUNITY. AND FINALLY, WHAT'S YOUR CULTURE? WHAT ARE YOUR VALUES? WHAT IS IT LIKE TO BE IN YOUR COMPANY? WHAT DOES IT FEEL LIKE TO BE IN YOUR OFFICE OR AT YOUR EVENTS? AND IF YOU CAN PUT THOSE THREE THINGS TOGETHER: CULTURE, COMMUNITY, AND CUSTOMERS, I THINK YOU CAN HAVE A WINNING SUCCESS.
CRAMER: WILL YOU BE WILLING TO LOSE SOME CUSTOMERS WHO YOU THINK DON'T FIT YOUR ETHOS?
BENIOFF: EVERY CEO GOES THROUGH THAT QUESTION. I THINK EVERY CEO WILL SAY AT SOMEPOINT THEY HAVE TO DECIDE ARE THEY GOING TO FIRE THEIR TOP SALES EXECUTIVE BECAUSE THEY DID NOT MATCH THEIR VALUES IN THE FIELD OR SOMETHING DID NOT HAPPEN? I KNOW I WENT THROUGH THAT, I HAD TO FIRE OUR TOP SALES EXECUTIVE AT THE TIME, IN OUR HISTORY. THIS WAS QUITE A FEW YEARS AGO NOW. AND THAT IS A TOUGH DECISION, IT IS A LOT OF SLEEPLESS NIGHTS. BUT YOU KNOW WHAT, IT'S A DEFINING DECISION FOR EVERY CEO WHEN THEY CAN SAY, THIS IS WHAT WE STAND FOR. WE STAND FOR THESE VALUES. NOT QUARTER TO QUARTER OR ACCORDING TO REVENUE. THAT'S GREAT. BUT LOOK AT SALESFORCE, WE'VE BEEN PUBLIC SINCE 2014, AND WE'VE DONE, WHAT, 50 EARNINGS CALLS. OUR VALUES DON'T CHANGE. OUR NUMBERS ARE CHANGING.
CRAMER: OK, BUT WE HAVE BEEN AMONG EXECUTIVES WHO HAVE QUESTIONED A NOTION THAT VALUES NECESSARILY LEAD TO HIGHER STOCK PRICES. WHEN I LISTEN TO YOU, I THINK VALUES ARE PERHAPS THE DETERMINANT OF HIGHER STOCK PRICES.
BENIOFF: I COULD NOT AGREE MORE. THAT IS THE NUMBER ONE THING. IF YOU WANT TO HAVE A GREAT COMPANY –
CRAMER: BUT IT IS ETHEREAL, IT'S NOT WHAT WE'VE BEEN TAUGHT.
BENIOFF: LOOK, YOU HAVE TO DECIDE, WHAT ARE YOU REALLY FOCUSED ON? ARE YOU FOCUSED JUST ON YOUR SHAREHOLDERS OR ARE YOU FOCUSED ON YOUR STAKEHOLDERS? YOUR STAKEHOLDERS ARE, YES, YOUR SHAREHOLDERS BUT ALSO YOUR CUSTOMERS, YOUR EMPLOYEES, YOUR PARTNERS, YOUR COMMUNITIES THAT YOU'RE IN.
CRAMER: IS THAT HAVE YOU'VE GROWN NORTH OF 40%?
BENIOFF: WE HAD A GREAT QUARTER, JIM. LOOK AT THAT. ON AND OFF-BALANCE SHEET, DEFERRED REVENUE. NOW MORE THAN 20 BILLION DOLLARS GREW AT MORE THAN 40% GROWTH.
CRAMER: BEST IN EIGHT YEARS. I AM CALLING BEST IN EIGHT YEARS. MY VIEW.
BENIOFF: THAT WAS BEYOND OUR EXPECTATIONS. THAT'S – IT WAS OUR BEST QUARTER WE'VE HAD IN A LONG TIME. IT'S AN AMAZING QUARTER AND YOU KNOW WHAT, JIM, WE COULDN'T BE HAPPIER. WE JUST GOT "FORTUNE" MAGAZINE'S #1 BEST PLACE TO WORK 2018. AND I THINK THAT SAYS IT ALL.
CRAMER: WHY WE PAY UP FOR GOOD REVENUES AND GOOD EARNINGS. MARC BENIOFF, FOUNDER AND CHAIRMAN AND CEO, SALESFORCE.
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