ServiceNow took big Agentic AI swing with Moveworks acquisition

The news cycle moves quickly, and with word on Tuesday that Alphabet was acquiring Wiz for over $30 billion, it’s easy to forget that ServiceNow made its own news waves last week, announcing a deal worth nearly $3 billion to purchase agentic AI startup Moveworks.

Sure, if you’re looking at the price tag, it’s just 10% of the value of the mega deal announced this week, but that doesn’t make it any less significant. In fact, it’s the biggest acquisition ServiceNow has made to date. It comes in the wake of a big push by ServiceNow to move into agentic AI, including thousands of pre-configured agents in its latest release.

The company is not alone in the agentic move, however, joining its big enterprise SaaS counterparts like Salesforce, SAP and Workday. All of these companies have a big advantage when it comes to building AI applications in that they help manage oodles of valuable business data that can be used to train large language models. While not all business data is perfect, it still offers a distinct advantage over say data from the open internet when it comes to AI business use cases.

It's the talent, stupid

ServiceNow CEO Bill McDermott, speaking with Jon Fortt on Fortt Knox last week, talked about the talent he was getting from the deal as much as the technology. He says they have a thousand customers using ServiceNow agentic AI, making it the fastest growing product in the company's history. The idea with this acquisition was to bring in talent to take advantage of that growth.

"We wanted to bring something in where we could accelerate the AI talent, and getting the best talent in Silicon Valley into ServiceNow is really a turbocharge to a fast-moving development," McDermott told Fortt. And with this acquisition, ServiceNow gets 500 new employees, many with AI chops, and many, including the founders, on long-term retention contracts, according to McDermott.

For Bhavin Shah, co-founder and CEO at Moveworks, it was more about being able to scale much faster than he could have had he stayed an independent company. “It's a real opportunity for us with this new kind of partnership to really scale this out to not just 350 customers, as we have, but ServiceNow has 8400 enterprises on the platform. It's a pretty big scale and scope that I'm very excited about,” Shah told me.

McDermott listed a slew of current Moveworks customers including Unilever, Toyota, Siemens, Palo Alto Networks, Hearst and Instacart, among others.

Taking on Salesforce

Somewhat surprisingly McDermott also sees this deal as an opportunity to take on the CRM market. He said that he intends for his company to be “the market leader” in CRM, a category where ServiceNow isn’t even really a player and Salesforce is the dominant company. Yet he sees an opening for them to eat away at Salesforce’s market lead with Moveworks in the fold to expand beyond its core IT services business into more front office functions like sales.

It's an ambitious idea, that's for sure, but all of this assumes the deal passes regulatory muster, and that's no guarantee given some of the antitrust activity we have seen so far early in the administration from the FTC and DOJ. If it does get to the finish line, the deal is expected to close in the second half of this year.

Moveworks might not have cost as much as Wiz, but if McDermott’s vision were to come to pass, it could give his company a big boost in the market. In all likelihood, there is going to be fierce competition among established companies and startups alike in the quest to push agents in the enterprise. ServiceNow believes this acquisition will give it a big advantage. Time will tell if the company is right or not.

Note: This is an expanded version of a News of the Week article that appeared in the 3/15/2025 FastForward newsletter.

Featured image: Bill McDermott on Fortt Knox