Jim Cramer's 'Mad Money' Recap: Leaving Comfort for the Cloud

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NEW YORK ( TheStreet) -- It's terrific to invest in what you know, Jim Cramer told his "Mad Money" TV show viewers Monday.

But for investors willing to stretch their imagination and learn what they don't know, there's even more money to be made.

Cramer, broadcasting on location from the 2013 DreamForce conference in San Francisco, said many investors might not understand the cloud computing revolution, preferring to invest in old-line tech names such as Microsoft ( MSFT) or Cisco ( CSCO). But when mutual funds and money managers look for growth, they look toward cutting-edge companies with 30% to 40% growth, and those companies all live in the cloud.

Investors must then choose whether they believe these companies, many of which have rich valuations by traditional metrics, are overvalued, or are the next big thing. Believing in the latter, as Cramer does, will involve leaving your comfort zone and taking on some additional risks. But the rewards for doing so can be astounding.

Executive Decision: Marc Benioff

In his first "Executive Decision" segment, Cramer sat down with Marc Benioff, chairman and CEO of Salesforce.com ( CRM), which in addition to hosting the DreamForce conference just reported in-line earnings with a 36% rise in year-over-year revenue.

Benioff said there are four things driving the growth at Salesforce, and they include cloud, mobile, social and the newest driver, connected devices. Behind all of these factors, he said, are customers -- managing customer relationships is what Salesforce is all about. No matter what business a company is in, they need tools to sell, market and connect to their customers, Benioff continued, and Salesforce software allows them to do that on a one-on-one basis.

Benioff mentioned that Philips ( PHG) will be introducing a new ultrasound machine later this week where technicians can push a button right on the machine and connect to Salesforce's service cloud products. It's those kind of connected devices that will be driving the next leg of growth at the company, he said.

Cramer said he'll be talking so some of those companies building on the Salesforce model later in the show.

More From Benioff

Continuing with his interview with Mark Benioff, Cramer dove deeper to find out why the DreamForce conference is so important to Salesforce.com.

Benioff explained that the world is changing rapidly, and DreamForce is the place where companies can see that change first-hand. He said that over the next week over 350 companies will be presenting and 1,100 sessions will be taking place among the 130,000 attendees plus countless more watching online from around the globe.

Benioff said the power of Salesforce is its platform, which, in turn, lets other companies be successful. Even companies like grocery store chain Safeway ( SWY) use Salesforce.com to manage their relationships with their customers, Benioff noted, and Salesforce provides the means to deliver one-on-one conversations with those customers no matter where they are.

Cramer noted this new cloud economy seems to be immune to the government sequester and worries over interest rates. Benioff agreed, adding this economy is all about innovating and building new things, which is a world away from Washington, D.C.

Executive Decision: John Donahoe

In his second "Executive Decision" segment, Cramer sat down with John Donahoe, president and CEO of eBay ( EBAY), whose PayPal division remains the leading provider of online payments around the globe.

Donahoe said PayPal is not only doubling down on its investments into mobile payments, but is also targeting new businesses and start-ups, many of which are taking online or mobile payments exclusively. PayPal is also making inroads into "bricks and mortar" retail, bringing the PayPal experience to point-of-sale terminals. PayPal is there to partner with merchants, not compete against them, Donahoe explained, which makes it a unique platform.

Donahoe also noted his company's StubHub service for event tickets is also doing very well and is launching into Europe with great success. He said the service provides a great fan experience and is a very efficient marketplace for ticket holders and event-goers to connect.

Finally, when asked about the health of the consumer, Donahoe said while he's not sure how the holiday season will play out, so far the consumer appears to be active for hot items like the new Playstation game console.

Cramer said eBay is a company that he's liked for a very long time.

Executive Decision: Drew Houston

Cramer also sat down with Drew Houston, co-founder and CEO of the privately held cloud storage service Dropbox, to find out the secrets behind the company's cloud-based success. Dropbox now offers service to over 200 million users.

Houston said users of Dropbox start off with the company's free two gigabytes of storage -- but once they try the product, many upgrade to the company's many paid options. He said four million businesses now depend on Dropbox -- and with the latest upgrade for business, users can now keep their home and work files separate and IT departments can have greater control over sensitive information.

When asked about competition, Houston noted that Dropbox has had competition for its entire life, but it turns out the service is harder to replicate than many believed. He said Dropbox is easy to use and "just works," a combination that has been a winning formula.

Cramer said Dropbox is just another example of the new economy at work.

No Huddle Offense

In his "No Huddle Offense" segment, Cramer sounded off against those who are calling the recent market rally a bubble that is undeserved. He admitted that, yes, many of the cloud and social stocks including Twitter ( TWTR) do have rich valuations by traditional metrics. But what if Twitter becomes the next Salesforce.com?

In the tech world, profits are seen as a sign of weakness, Cramer explained. Meanwhile, growth, even unprofitable growth, is revered by Wall Street, as companies like Amazon.com ( AMZN) have proven for years.

Outside of tech, companies like Boeing ( BA) continue to surprise with new orders, making its 80% rise this year certainly justified. With litigation at the banks winding down, he added, the markets may actually be pricing stocks correctly after all.

To watch replays of Cramer's video segments, visit the Mad Money page on CNBC.

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-- Written by Scott Rutt in Washington, D.C.

To email Scott about this article, click here: Scott Rutt

Follow Scott on Twitter @ScottRutt or get updates on Facebook, ScottRuttDC

At the time of publication, Cramer's Action Alerts PLUS had no position in stocks mentioned.

Jim Cramer, host of the CNBC television program "Mad Money," is a Markets Commentator for TheStreet.com, Inc., and CNBC, and a director and co-founder of TheStreet.com. All opinions expressed by Mr. Cramer on "Mad Money" are his own and do not reflect the opinions of TheStreet.com or its affiliates, or CNBC, NBC Universal or their parent company or affiliates. Mr. Cramer's opinions are based upon information he considers to be reliable, but neither TheStreet.com, nor CNBC, nor either of their affiliates and/or subsidiaries warrant its completeness or accuracy, and it should not be relied upon as such. Mr. Cramer's statements are based on his opinions at the time statements are made, and are subject to change without notice. No part of Mr. Cramer's compensation from CNBC or TheStreet.com is related to the specific opinions expressed by him on "Mad Money."

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