HubSpot’s Clearbit Acquisition: A Game Changer or A Repeat of History?
Two weeks ago, the business world witnessed a significant move: HubSpot agreed to acquire Clearbit for a whopping $150 million in cash. This strategic move brings to mind Salesforce’s infamous acquisition of Jigsaw in 2010 – a venture that didn’t exactly pan out as expected. However, I believe HubSpot’s foray into this territory might just be the success story that Salesforce’s venture never was. Let’s delve into why.
The Salesforce-Jigsaw Saga: A Brief Retrospective
In 2010, Salesforce made a bold move by acquiring Jigsaw, a B2B data firm, for $142 million. Renamed as Data.com, this venture promised much but delivered little. By 2018, Salesforce decided to shutter Data.com, selling it to D&B for a fraction of its worth despite its $300M in ARR at the time.
So, what went wrong? Salesforce missed a crucial opportunity to integrate Data.com with customer data, which would have required the development of new, innovative data insights products. Back then, data use cases were still in their infancy, mostly limited to sales. Salesforce’s strategy focused more on being the best in CRM, rather than diversifying into the B2B data products market. Ultimately, divesting Data.com led Salesforce to a more streamlined and successful path.
HubSpot and Clearbit: A New Dawn
Fast forward to 2023, and we see HubSpot announcing its intent to acquire Clearbit. At first glance, it might seem like HubSpot is walking down a path previously trodden by Salesforce. However, there are a few key reasons why this time it could be different:
Data Integration Across Workflows: Data now plays a pivotal role in linking various GTM workflows and applications. Owning a data asset like Clearbit could reduce integration costs for HubSpot users.
Maturation of the Data Market: The data market has evolved significantly, with uses extending beyond mere prospecting to encompass areas like growth, marketing, and engagement – all domains where HubSpot excels.
HubSpot’s Broad Product Range: Unlike Salesforce in 2010, HubSpot boasts a more diverse product portfolio, offering a greater opportunity for successful data integration.
Potential Pitfalls and Opportunities
Despite these positives, there are challenges HubSpot must navigate. Primarily, they should avoid developing a basic prospecting tool for SMBs that only offers rudimentary data. This approach risks generating low-quality, high-churn revenue and could potentially damage their brand reputation.
On the flip side, HubSpot has the potential to redefine GTM data solutions. By integrating Clearbit’s data with HubSpot’s existing customer data and activity signals, they could develop innovative data products to enhance targeting and response rates.
Conclusion: Smart Move or Misstep?
In essence, the Clearbit acquisition could transform HubSpot from a mere provider of a “Dumb Data API” to a pioneer of “Smart Data Insights & Signals.” This move has the potential to mark a new chapter in data-driven marketing solutions, provided HubSpot navigates this path with strategic foresight and innovation and doesn’t get bogged down in legal issues over use of data in its platform. They will likely need to rewrite terms of service and lose some customers in the process.
As an advocate for bespoke data solutions, we at LeadGenius are excited to see how HubSpot’s journey unfolds and how it could potentially reshape the landscape of GTM and data-driven marketing. Stay tuned for more insights and analysis on this developing story!