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Details of hedge fund investments into Salesforce emerged yesterday, revealing some significant bets at a critical and uncertain time for the company.

Why it matters: Activist Elliott Management stands to benefit from a pack of hedgies supporting its battle for changes at Marc Benioff's company, though Salesforce has a few fund allies building stakes as well, Michael Flaherty writes.

Driving the news: Starboard Value, the activist that agitated against Salesforce back in October, disclosed a stake of 3 million shares, worth $400 million — an ownership likely worth above half a billion dollars today, factoring in the stock rally. 

The size of Starboard's stake confirms it will not sit quietly.

Activist investor ValueAct, seen as a Benioff ally that just earned a Salesforce board seat, said it owned 560,00 shares worth $74 million.

Inclusive Capital, the activist fund started by ValueAct's founder Jeff Ubben, said it owned $216 million worth of Salesforce shares.

Catch up quick: Salesforce delivers earnings on March 1, a key moment for the company to show its progression. Two weeks later is the deadline for shareholders to nominate directors to the board.

Of note: The size of Elliott's actual position is still unknown, though reports put it at several billion dollars' worth of stock. By comparison, Elliott's investment in fellow large-cap stock AT&T back in 2019 was around $3 billion.

Elliott's 13F did not list CRM, meaning it started accumulating common stock starting last month.

The same is true for Third Point, which also doesn't show CRM in its 13F. Reports say Third Point is yet another activist scooping up Salesforce shares.

💭 Michael's thought bubble: Elliott does not want a proxy fight. As big and powerful as the fund is, it's rarely taken a company to a vote. Benioff doesn't, either, knowing Salesforce's underperformance makes that majority support math tricky.

Look for Salesforce to announce some major strategic moves on March 1 to get Elliott and others off its back, and to announce aggressive growth and cost targets that garner the hedge fund's support, and possibly some kind of settlement. If not, buckle up.

Salesforce's hedge fund hotel fills up amid Elliott pressure

1 big thing: Salesforce's hedge fund party 

Photo illustration of Paul Singer and Marc Benioff. 

Elliott co-founder Paul Singer and Salesforce co-founder Marc Benioff. Photo illustration: Shoshana Gordon/Axios. Photos: Stefan Wermuth/Bloomberg, Jonathan Moscrop/Getty Image

Telltale, a narrative gaming developer, has raised an $8 million Series A round to support the launch of its first titles, the company exclusively tells Tim.

Why it's the BFD: Telltale, which relaunched four years ago under new management, is banking on its first new games to win back fans still burned by the original iteration's flameout.

Details: Funding will go primarily toward marketing upcoming titles "Expanse: A Telltale Series," which debuts this summer, and "The Wolf Among Us 2."

"We wanted to make sure we could continue development on our existing slate while we had the resources to properly market 'The Expanse' to bring it out later this summer," Telltale's CEO Jamie Ottilie says.

The round was led by Hiro Capital, a London-based games, sports and metaverse VC fund, with participation from "Walking Dead" publisher Skybound Entertainment.

Catch up quick: The original Telltale, best known for its "Walking Dead" game, shut down in 2018 and was relaunched a year later after its assets were acquired by LCG Entertainment.

The big picture: The relaunch of Telltale initially caused unease within the gaming community still burned from the prior sudden implosion.

Ottilie wants to be judged on what the new version of Telltale does, rather than for the brand's past. "You have to give us a minute and let us make our own mess or own greatness and then you could judge it," he says.

2. The BFD: Telltale funding exclusive 

Illustration of a gaming control with a dollar sign cable

Advertiser Perceptions, the New York-based market intelligence and analysis firm, received an investment from Eureka Equity Partners. https://axios.link/3K9p0T5

Multimedia Music acquired the music publishing and music master rights from STX Entertainment's entire film music library in an eight-figure deal. It doesn't include STX's current or future films. https://axios.link/3lAv8tn

⚽ Jahm Najafi, the Phoenix billionaire and private equity investor, is prepping a $3.75b takeover bid for Premier League club Tottenham Hotspur, per the FT. https://axios.link/3YzQe9Z

Vodafone is considering strategic options for its Africa business, which could be valued at around $14b, per Bloomberg. https://axios.link/3xm7x2p

NBCUniversal signed a licensing deal with Seven.One Entertainment, a German broadcasting group. https://axios.link/3Ec9ZMD

3. Deal flow

AMC Networks appointed Kristin Dolan, the longtime Cablevision executive married to AMC owner James Dolan, as CEO, Sara Fischer and Tim write. https://axios.link/3I8Tr9m

ITV hired ABC Signature alum Menaka Evans as CFO for ITV America and ITV Studios America. https://axios.link/3Sjrz7r

YMU, the talent management company that represents Paris Hilton, Emily Ratajkowski and Steve Aoki, appointed NBCUniversal's Linda Yaccarino as the group's global chair. https://axios.link/3EgzTyL

Cinemark founder Lee Roy Mitchell is stepping down from the board of directors. https://axios.link/40SkcaG

The Match Factory, a Cologne-based sales company, expanded and restructured its acquisition and development team, appointing Thania Dimitrakopoulou as VP of acquisitions and sales, Claudia Solano as senior manager of acquisitions and Cécile Tollu-Polonowski as head of development. https://axios.link/3k39uh6

Ryan Seacrest is stepping down from "Live with Kelly and Ryan" after six seasons and will be replaced by co-host Kelly Ripa's husband Mark Consuelos. https://axios.link/3Ir0Dz0

4. Movin' on up (or out)

Twitter to allow cannabis advertising (Axios)

"The policy represents the biggest step forward that any major tech company has made toward allowing cannabis advertising where it's legal in the U.S.," Sara writes.

Roku sees some improvement in ad spending (WSJ)

"Roku said the advertising market was muted in the fourth quarter but noted that ad spending among companies in the restaurant, travel, packaged goods and wellness sectors appeared to be improving so far in the first quarter," Patience Haggin writes.

Podcast companies, once walking on air, feel the strain of gravity (NYT)

"Less direct investment in content isn't necessarily a sign of trouble," Lauren Jarvis, the former head of content partnerships at Spotify, told Reggie Ugwu. "It could mean that the industry has hit a growth stride and can adjust to a more sustainable investment model."

Winnie-the-Pooh horror film is a scary sight for copyright holders (Bloomberg)

"The film isn't expected to be a big hit at the box office, with the website Hollywood Stock Exchange forecasting just $9 million in domestic ticket sales over four weeks. But the picture hints at a scary future for major studios whose copyrights on famous characters are nearing expiration," Thomas Buckley writes.

5. Channel surfing

Illustration of a TV color test screen in the shape of a wave.

👀 Situational awareness: Hasbro CEO Chris Cocks said today the company has received "strong interest" in its sale of the majority of Entertainment One and expects to provide an update next quarter.

@tim_bays: "Ant-Man and the Wasp: Quantumania." Adding Jonathan Majors and Bill Murray is great, but the loss of Michael Peña's Luis is unacceptable.   

@kerrymflynn: "In the Air Tonight" by Phil Collins. My neighborhood has an annual celebration of the singer. 

✏️ Thanks to Michael Flaherty for editing and Katie Lewis for copy editing this newsletter.

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February 16, 2023

1 big thing: Salesforce's hedge fund party