Rackspace Poised to Profit from Uptick in Cloud Services

An increasing number of enterprise and mid-market companies are looking to deploy SaaS applications across all departments, from sales and marketing to HR and finance.

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San Antonio-based Rackspace, a managed cloud company, is rapidly positioning itself to take advantage of this emerging trend. The company has finalized a number of key acquisitions in the past year which have placed it at the forefront of the cloud services trend estimated to drive $73 billion in spending by 2020.

Most recently, the company acquired RelationEdge, its third major acquisition in a year. The acquisition of RelationEdge will allow the company to provide SaaS applications and implementation and managed services to its suite of IT-as-a-service offerings.

RelationEdge helps businesses implement the Salesforce CRM platform, in a segment of the SaaS applications market that is growing at about 30% per year and is projected to be worth about $49 billion by 2020. The company is headquartered in San Diego but has offices throughout the U.S. and 125 employees.

No details of the deal were made public, although a representative for the company noted that it did not require Rackspace to take on additional debt. Rackspace representatives said there were no plans for restructuring of RelationEdge at the time of the announcement.

According to Executive Vice President and General Manager Gerard Brossard, Rackspace will use existing the company’s resources to invest in even more U.S.-based development, with an eye toward end-to-end customer relationship capabilities.

Previous acquisitions for the company include Datapipe in the fall of 2017 and TriCore solutions in the spring of that same year.

Rackspace was founded in San Antonio in 1998 but was acquired in 2016 by New York-based Apollo Global Management. Today the company services over 140,000 business customers from its data centers on five continents.