Salesforce CEO Marc Benioff is telling an odd story about how Microsoft tricked him

Salesforce CEO Marc Benioff is still doing damage control over Microsoft’s $26 billion acquisition of LinkedIn.

Lately, Benioff has been hinting that the guy he once thought was his friend, Microsoft CEO Satya Nadella, duped Benioff into revealing part of Salesforce’s strategy to Microsoft.

Benioff told this story to attendees of the Code Conference on Monday, and just expanded on it Thursday on CNBC’s “Mad Money with Jim Cramer.” (emphasis ours).

“Well, we just had a surprise. That’s all that is. We thought there was a new Microsoft. We got a call from Satya said, “Hey, you know, we’re so excited to work with you. Would you spend some time with Scott Guthrie? He runs Azure. You’re gonna love him. Tell him all about your strategy.” And we met with Scott Guthrie. And then two weeks later, read in the newspaper that Scott Guthrie’s now in charge of their CRM business. I’m like, ‘Well, that would have been good to know ahead of time.’ And then I kind of was like, ‘You know, maybe the new Microsoft is actually the old Microsoft.’ And look, these were the mid-managers during that era. Now they have moved up. And the culture’s back.”

The timeline surrounding this story deserves a close look.

The companies’ public friendship began when Nadella was named CEO of Microsoft in early 2014, and began reaching out to others in the industry to create partnerships as he shifted the company from selling Windows and other software to selling cloud services.

One of those cloud services is customer relationship management (CRM), which helps salespeople track prospects and manage interactions with customers. This is Salesforce’s flagship product. Microsoft offers a competitor called Dynamics, and the two companies have historically been major competitors and enemies.

But in May 2014, they announced a partnership that would see both of them offering more support to each other’s products in some areas, while continuing to compete in CRM.

The companies continued to talk, and in spring 2015, according to reports by CNBC’s David Faber and Bloomberg’s Dina Bass, Microsoft was talking to Salesforce about a possible acquisition. Talks broke down when the companies couldn’t agree on price, Faber reported.

Gurthrie took over the CRM business for Microsoft a little after that happened, in June 2015.

Even after all this, Microsoft CEO Satya Nadella appeared at Salesforce’s huge annual conference, Dreamforce, in October 2015 — months after Benioff says he began to get suspicious.

In other words, Benioff may have started having second thoughts about Microsoft and Nadella’s intentions throughout 2015, but they don’t appear to have been too serious until last June.

That’s when Microsoft outbid Salesforce for LinkedIn, paying $26.2 billion for the professional social network.

Why he’s worried

Benioff is concerned that once Microsoft has its hands on LinkedIn, it will control all of LinkedIn’s professional data and block salespeople using Salesforce (and other competing CRM products) from accessing LinkedIn.

Salespeople rely heavily on LinkedIn to help them find prospects and make cold calls.

In fact, last summer, Salesforce scored a deal that let it hook directly into that LinkedIn data, though a tool called Sales Navigator.

If Microsoft gives itself exclusive or even just advantaged access to that data, Microsoft will hurt Salesforce deeply.

Microsoft has continually said that LinkedIn will continue to operate as its own entity. And LinkedIn says it has been talking with other CRM vendors to give them the same access to LinkedIn via Sales Navigator.

But Benioff isn’t buying it. He keeps referring to something that Guthrie said in September 2016 at the Deutsche Bank Technology Conference (emphasis ours):

“I think we’ve kind of talked about the cloud growth that we’ve had obviously with Azure and Office 365, Dynamics has been on an absolute tear as well. And we see huge upside with that. And the exciting part, we’ve announced plans to acquire LinkedIn. … You create the ultimate selling tool, the ultimate customer support tool in the industry because you have so much insight that can assist a sales rep or assist a customer service rep that no one other vendor can provide.

That’s why Benioff has been complaining to regulators with the hopes that they will block the deal outright (unlikely) or put conditions on it (possible). The US and other countries have already given their blessing to the acquisition.

But European commissioners are apparently listening. Earlier this week, the EU said Microsoft has already offered some concessions over the deal, reports Reuters.

In the meantime, Benioff is clearly a lot cooler toward Microsoft than he was a year ago.

NOW WATCH: How the ‘perfect body’ for men has changed over the last 150 years

Business Insider Emails & Alerts

Site highlights each day to your inbox.

Follow Business Insider Australia on Facebook, Twitter, LinkedIn, and Instagram.