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HomeUncategorizedWSJ News Exclusive | Tensions Grew at Salesforce Between Co-CEOs Benioff and...

WSJ News Exclusive | Tensions Grew at Salesforce Between Co-CEOs Benioff and Taylor Ahead of Leadership Change

Tensions had been growing between

Salesforce Inc.’s


CRM -2.09%

co-Chief Executives

Marc Benioff

and

Bret Taylor

over their responsibilities and how the business was run for months before the business-software provider said last week that Mr. Taylor would exit the role, people familiar with the executives said.

Mr. Benioff, who is also co-founder, became frustrated about how Mr. Taylor was spending his time, the people said. Among his concerns were whether Mr. Taylor was spending too much time in a new role as Twitter Inc.’s chairman, too much time with other CEOs and customers and not enough time on Salesforce product and engineering, the people said.

While the two had worked well together, cracks started forming in recent months that created friction between the men, the people familiar with the matter said. Ahead of Salesforce’s announcement that Mr. Taylor would exit, there was some discussion about trying to work things out and arranging for Mr. Taylor to stay for another year or so, but that didn’t pan out, some of the people said.

The growing strains ultimately resulted in Salesforce’s announcement last week that Mr. Taylor would vacate the co-CEO role on Jan. 31, with Mr. Benioff becoming the sole leader again and continuing to serve as the company’s chairman. Mr. Taylor, 42 years old, has shared the top role with Mr. Benioff for about a year. His planned departure marks the second time in less than three years that Mr. Benioff has parted ways with someone installed as his co-CEO.

Bret Taylor said last week that it was time ‘to return to my entrepreneurial roots,’



Photo:

Nathan Laine/Bloomberg News

Mr. Taylor, an entrepreneur and founder earlier in his tech career, said when his planned departure was announced that he felt it was time “to return to my entrepreneurial roots particularly given the landscape and economy going through such shifts.”

At the time, Mr. Benioff thanked Mr. Taylor for his Salesforce service and said he wasn’t happy about the departure. “I know he wants to go create a third great company,” Mr. Benioff said, saying he hoped Mr. Taylor would return to Salesforce.

The tech industry faces growing challenges in areas such as cloud-computing software that thrived during the pandemic. Salesforce’s corporate customers are becoming more conservative with the slowing global economy, leading to the slowest quarterly sales growth on record in the company’s history.

In the company’s most recently reported, October quarter, sales grew 14% from the prior year, down from 27% growth in the same quarter a year earlier. In recent months, Mr. Benioff has grown frustrated with the company’s slowdown and has examined company execution issues in addition to the broader economic downturn, some of the people said.

The announcement wasn’t long-planned, said people familiar with the matter. Mr. Benioff will now give a solo keynote at an event Salesforce is hosting at the Javits Center in New York this week for employees and customers. Information from mid-November about the summit and related events suggested the two co-CEOs would be leading them together, according to documents viewed by The Wall Street Journal.

Mr. Benioff, who co-founded Salesforce in 1999 and remains among its biggest shareholders, has tried to share leadership power at the company before. In 2018, Keith Block was promoted to co-CEO alongside Mr. Benioff after five years as president. He left 18 months later, saying he was moving on to the next chapter.

With Messrs. Benioff and Taylor, there lately was escalating confusion among some executives over whom they should report to, people familiar with the matter said. Mr. Benioff recently engaged more directly with certain executives who report to Mr. Taylor, they said.

Marc Benioff, far right, and Bret Taylor shared a stage at a conference in San Francisco in September.



Photo:

Marlena Sloss/Bloomberg News

During the World Economic Forum in Davos, Switzerland, in May, people asked Mr. Taylor about his work with Twitter during some Salesforce events. He and Mr. Benioff typically have shared the stage at most big events, often improvising and bantering to large crowds of employees, clients and other guests. When it has come time to sit on panels with peers, government officials or celebrities, Mr. Benioff usually has the sole seat.

Mr. Taylor joined Salesforce in 2016 through its acquisition of software company Quip Inc., which Mr. Taylor co-founded and ran at the time. He had served as Salesforce’s chief product officer and chief operating officer before being named as co-CEO on Nov. 30 last year.

Salesforce elevated Mr. Taylor a day after he was named Twitter chairman, putting him in position to oversee two of Silicon Valley’s most prominent companies. His Twitter job put him at the center of one of tech’s most contentious battles this year as

Elon Musk

agreed to take over the company in April, then tried to get out of the deal before eventually buying it in October.

Mr. Taylor’s position as Twitter chairman ended as the $44 billion takeover by Mr. Musk closed.

Mr. Taylor was credited as the architect of Salesforce’s $27.7 billion purchase of workplace-collaboration company Slack Technologies, Salesforce’s biggest acquisition ever. Salesforce said this week that

Stewart Butterfield,

the CEO and co-founder of Slack, plans to leave the company next month.

Through his career, Mr. Taylor has been involved with some of the tech industry’s most notable innovations—from Google Maps to Facebook’s “like” button—and he founded companies that have sold for hundreds of millions of dollars.

As markets react to inflation and high interest rates, technology stocks are having their worst start to a year on record. WSJ’s Hardika Singh explains why the sector — from tech giants to small startups — is getting hit so hard. Illustration: Jacob Reynolds

—Laura Cooper contributed to this article.

Write to Emily Glazer at Emily.Glazer@wsj.com, Aaron Tilley at aaron.tilley@wsj.com and Lauren Thomas at lauren.thomas@wsj.com

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