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ServiceNow to Acquire FriendlyData: Will It Help?

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Why FriendlyData could be an important acquisition

On October 10, ServiceNow (NOW) announced that it will acquire start-up company FriendlyData. It didn’t reveal the financial terms of the deal. The acquisition will allow ServiceNow, an enterprise cloud service provider, to integrate FriendlyData’s natural language query (or NLQ) tool into its Now interface platform. The implementation of NLQ technology will help customers make queries in plain English, thus avoiding unnecessary technical questions and complications of support requests in enterprises using machine language.

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The Now platform, which supports applications of various departments of ServiceNow, including IT, human resources, security operations, and customer service management, can easily access NLQ technology for better communication. The developers’ team and ServiceNow’s partners are also expected to benefit from the NLQ application.

Past acquisition deals

In May, ServiceNow bought a similar kind of company called Parlo, which offers artificial intelligence and non-technical language understanding workforce solutions. That same month, it combined the Talkdesk Enterprise Contact Center Platform with its Now platform. In April, it acquired SaaS (software as a service) management startup firm VendorHawk.

To boost its product portfolio, ServiceNow continues to focus on inorganic growth. In the last five years, it has generated a steady free cash flow. From the graph above, you can see its increasing free cash flow trend. In the last five years, it has maintained an average free cash flow of $173 million. Workday (WDAY), which belongs to the same space, generated an average free cash flow of $130 million in the same period.

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