Israeli company Totango has signed a $30 million deal with international software firm SAP, sources inform "Globes." Payment will be spread over five years. In the deal, Totango's Customer Success system will be installed in SAP's customer support and retention systems worldwide. The size of the deal is unusual for an Israeli startup, both in money and extent - it involves over 3,000 work stations. SAP is scheduled to officially launch its system, which has already been working in its facilities for two months, in the coming days.
Totango's system coordinates the customers' data with all the systems operated by the company. Using artificial intelligence (AI), the system provides insights about the customer's satisfaction and preferences, and helps retain the customer and expand the volume of his or her business. Totango's technology is offered at a time when cloud services are becoming centralized. The customer's ability to switch companies forces them to strive to retain him or her.
Sources in the sector said that the link between SAP and Totango was made by Nechemia (Chemi) Peres, a managing general partner in Pitango Venture Capital, which invested in Totango. Peres has close ties with SAP CEO Bill McDermott. The deal between SAP and Totango was signed in June 2018, and installation of Totango's system began in August 2018. Cooperation between Totango and SAP also includes integrating the system in SAP's App Center, which it markets and promotes among hundreds of thousands of customers worldwide, and is likely to generate more deals for Totango.
Cooperation with Totango is in the framework of the SAP.iO fund, which invests in startups in the early stages (between the seed round and the A round). The SAP fund, which has $35 million, has invested in three Israeli startups to date: BigID, which offers AI-based solutions for protection of private information; Cymmetria, which develops solutions for misleading attackers in the cyber defense field; and SilverBack, which provides advanced analyses for e-commerce companies. All of SAP.iO's portfolio companies offer organizational software technology in SAP's ecosystem.
Another SAP investment branch in Israel is an independent venture capital fund named Sapphire Ventures, which has $1 billion, including $700 million earmarked for investment in the advanced growth stages.
CEO Guy Nirpaz, SVP business development Omer Gotlieb, and Oren Raboy founded Totango in 2010. The company has raised $36 million to date in five financing rounds. Besides SAP, its customers include Google, Zendesk, CA, Keynote Systems, and Zoho. Its revenue is believed to be in the tens of millions of dollars, and the company has been growing rapidly in the past year. It cannot be ruled out that following the signing of the deal with SAP, its next big customer could be another major cloud services company, such as Salesforce, Microsoft, Oracle, etc.
Totango acquired Israeli company Personity.ai in June 2018. The acquired company developed technology for characterizing job candidates on the basis of their behavior on the social networks. Personity.ai's AI technology was integrated into Totango's system.
Published by Globes, Israel business news - en.globes.co.il - on January 28, 2019
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