February 8th, 2009 by Joshua Weinberger

[NOTE: Our original blogpost can be found here. This version updates several elements and adds additional information.]

Here’s the Reuters story that apparently broke the news late Thursday.

Not much information to impart beyond the headline, as Salesforce.com has yet to make any official statement aside from its 8-K filing with the SEC.

In addition to President and Chief Strategy Officer Steve Cakebread‘s departure (retroactively effective February 1) for what the filing lists as “personal reasons [that do] not involve any controversy or disagreement with the Company,” reports around the Web indicate that two Salesforce.com vice presidents have been let go.

One was reported very early on as Gary Hanna, executive vice president of enterprise sales. (His LinkedIn profile indicates he’d been at the company since 2006, and had been a senior vice president at Siebel Systems prior to that.)

The other casualty remained a mystery for some time, though The Wall Street Journal‘s Ben Worthen reported (in a Friday blogpost timestamped just before 5p ET) that the person in question was Dave Orrico. (An anonymous commenter on our Friday blogpost suggested Orrico’s name as well.) The WSJ post says only that Orrico was a “top sales executive” at Salesforce.com, and doesn’t include his title. (The New York Times also refers to him as merely “another sales executive.”) Orrico seems not to have a profile on LinkedIn, but in various Salesforce.com corporate releases over the years, he has been listed as senior vice president and general manager of Americas (Aug. 2003, when he was hired); Executive Vice President, Americas (Aug. 2006); and Executive Vice President of Sales (Sept. 2007).

More after the jump…

Worthen’s blogpost included the following upside-downside factoids:

Salesforce.com’s market cap has dropped about 60% since August…. >snip<And the company recently canceled its European user conference, replacing it with a free one-day event.

Cakebread had attempted to retire once before, and his family runs a well-regarded Napa Valley winery. [Cakebread Cellars’ Web site is here. -j] Also, Salesforce.com was teeming with sales executives, leading some analysts to suggest that the moves could be the sort of trimming companies often engage in during a down economy and not an indication of more substantive problems for Salesforce.com.

Worthens also mentions the view of one equities analyst who notes that “[t]he subscription business model hasn’t been through a downturn before” — another suggestion that we’re all in new territory here, and personnel changes at a software-as-a-services company such as Salesforce.com may have to be viewed in a different framework.

Cakebread’s bio was already down from the Salesforce.com corporate site as of Friday morning, but here’s the Google Cache version dated 2/2/09. Also, his LinkedIn page.

Here’s the Barron’s blog, with more detail on the terms of Cakebread’s severance, along with some analysts’ reactions. (The company’s stock ended Friday down almost 6 percent, but that was a rebound off lower levels earlier in the day.)

The New York Times‘ Bits blog had a post today (Saturday) that added little new information.

Kara Swisher’s AllThingsD has a brief report that includes a quote from an analyst’s report:

“While the company has been able to close deals, we believe the deals, in general, have been downsized and invoice duration has been shortened,” Cowen Co. analyst Peter Goldmacher wrote in a research note this week. “We know of no deals over 1,000 seats in the quarter.”

Here’s a snapshot of Steve Cakebread’s profile at Forbes, which was live Friday evening, but the link is to the identical Google Cache version (cached 1/29/09), in case Forbes updates/deletes the content.

56 Years Old; Steve Cakebread has served as Chief Financial Officer since April 2002. From April 1997 to April 2002, Mr. Cakebread served as Senior Vice President and Chief Financial Officer for Autodesk, Inc., a software company. From 1992 to 1997, Mr. Cakebread served as Vice President of Finance for Silicon Graphics, Inc., a computer workstation company. Mr. Cakebread serves as a director of eHealth, Inc. and Solarwinds.net, Inc. Mr. Cakebread received a B.S. from the University of California at Berkeley and an M.B.A. from Indiana University. Effective March 6, 2008, Steve Cakebread will now serve as the Company’s President and Chief Strategy Officer.

This quick hit from The Industry Standard (dated Friday, February 6) includes some context about Salesforce.com’s third quarter — the most recent for which figures are available, and which included the acquisition of contact center specialist InStranet. (Salesforce.com’s fourth quarter ended on January 30, but, by historical standards, it’s too soon to expect results. No date has yet been set, but the 3rd quarter figures were released on November 20 — making February 20 roughly the corresponding date here.)

A quick aside about Dave Orrico: destinationCRM.com (very briefly) noted his arrival at Salesforce.com back in August 2003 (before my time at the magazine, by the way). The hiring was hardly unorthodox in its circumstances — especially the fact that Orrico was hired away from Siebel Systems, not uncommon among Salesforce.com employees of the era, around the time Salesforce.com was routinely picking up Siebel accounts — and Siebel account executives along with them — and Siebel was increasingly finding itself referred to in the media as “struggling.” (Orrico’s fellow-casualty this week, Gary Hanna, also had Siebel on his resume, for example.)

Orrico, however, had also known Salesforce.com cofounder, chairman, and CEO Marc Benioff way back when the pair were both at Oracle. Here’s Benioff, in a statement released when Orrico was hired in 2003:

“It was great to work with Dave while I was at Oracle, and it is wonderful to have him join our winning team at salesforce.com,” said Marc Benioff, chairman and CEO of salesforce.com. “As one of Siebel’s top sales managers of all time, Dave brings a critical array of sales management and wide-reaching CRM expertise to salesforce.com during this time of dramatic company growth. His enthusiasm and experience will be invaluable to the company as we continue to solidify our market leadership position and promote customer success throughout the Americas.”

Orrico was one of four Siebel sales execs that Salesforce.com poached in quick succession at the time — and the hiring of one of those four, Brett Queener, sparked a lawsuit by Siebel alleging breach of contract and inducement of fellow Siebel employees to jump ship. (Salesforce.com, as one might expect, denied the accusations.)

Orrico appears to have been the most significant Siebel-to-Salesforce.com hire in the wake of Queener’s July 9, 2003, departure for Salesforce.com, though it’s important to note that (a) I haven’t located any reports actually naming Orrico as the person (or one of the people) in question, and (b) I have yet to locate any reference to the resolution of Siebel’s 2003 suit.)

I’m sure we’ll hear much more about this as events unfold, and that we’ll get some concrete answers in the coming days and weeks leading up to Salesforce.com’s quarterly report.

j.

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