Zoom and Workvivo: It’s a Matter of Time and Place
Last week we learned that Zoom intends to acquire Workvivo. I approve of this acquisition.
First, we need to understand that it’s not often I get to write “Zoom acquired” in a sentence. Zoom is acquisition reticent. It has only acquired a few companies. Like most companies, Zoom has rarely seen source code it couldn’t write better, but acquisitions can be advantageous. The buy vs. build decision is complex, but time-to-market favors acquiring.
Public companies can often innovate and grow more efficiently by acquisition, especially if they can acquire with its stock. We don’t know the terms of the deal, but I suspect there’s ZM stock involved. Yes, ZM shares are low compared to its pandemic high, but there’s a secret to consider: back to office mandates are not working. Buying with stock can be attractive for several reasons, and effective when the seller agrees that the upside potential is better together than alone.
If Zoom favored buying, it suggests the company concluded there’s a window of opportunity. We don’t know what it is, but here’s a secret to consider: back to office mandates are not working. If employees remain distributed, we are going to need better tools for distributed teams.
The future of work is distributed. The past was in-office, and the future is distributed. The current chapter of hybrid work is the necessary transition. It’s necessary because we have some challenges to solve. We nailed meetings during the pandemic, but still have work to do recreating the less formal aspects of in-office work. Things such as team building, culture propagation, mentoring, and ad-hoc communications to name a few.
It’s not an easy problem to solve. It’s been something we’ve been trying to solve for a long time. The closest category is known as enterprise social. There’s been several attempts including Cisco Quad, Yammer, Salesforce Chatter, Workplace by Facebook, even Slack — all effective messaging apps, but none of them nailed the social aspects of being in an office. I suspect part of it is timing — post-pandemic, the problem and solution are more clear now.
Workvivo addresses it nicely and more importantly has traction. I’d like to be able to say Eric Yuan learned about Workvivo from this 2022 TalkingHeadz podcast with its CMO Gideon Pridor. I can’t claim that because I don’t know when Yuan discovered Workvivo, but we do know he participated in Workvivo’s 2020 $38M fundraising round.
Hybrid work is the main thing to sell until the UCaaS sector figures out the social challenge of distributed work. This type of innovation takes time to develop and to prove. Last Fall, Zoom announced Zoom Spots. A clever approach to facilitating ad-hoc interactions across distributed teams. A few weeks ago, that product was renamed Zoom Huddles and made generally available. At the same time, Zoom also announced Zoom Clips, an asynchronous video messaging tool. Clips is not yet generally available.
With WorkVivo, Zoom will have a new set of proven communications and collaboration tools designed for social and informal communications. WorkVivo already offers a company-wide information and interaction that drives transparency and engagement — regardless of employee location.
“[Our platform offers] a vibrant, familiar social experience, and has a proven history of unparalleled levels of adoption,” said John Goulding, CEO and co-founder at Workvivo. Workvivo suite also extends to frontline employees, a sector that most UCaaS providers have trouble penetrating.
Workvivo democratizes access to information, and offers an activity feed that keeps employees up-to-date on events, activities, and news; an interactive forum; employee directory with profiles, groups, and communities; and recognition features such as badges and awards. There’s also centralized management tools that analyze behaviors and adoption. Workvivo customers include Amazon, RyanAir, and Mercedes Benz.
Zoom Blog: “With this acquisition, Zoom continues its evolution to provide the best end-to-end collaboration platform focused on enabling modern work and powering the digital-first workplace.”
Zoom was a meetings company. Then it expanded into UCaaS (Zoom Phone and Zoom Chat), Then it added Zoom Contact Center and Zoom WEM. It also added Calendar and Email. Now with WorkVivo, it appears Zoom intends to be a comprehensive provider of engaging conversations: calls, chats, meetings, emails, customers, colleagues and even culture — scheduled, ad hoc, or real-time; asynchronous, in-the-office, hybrid, or distributed.
The acquisition is expected to close 1H24.