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Cisco is acquisition king of the noughties. Race for the teens already underway.
Congratulations Cisco Systems. According to the Wall Street Journal and Dow Jones VentureNews, these are the 10 most acquisitive technology companies over the past decade. (Number of acquisitions in parentheses).
- Cisco Systems – 48
- IBM – 35
- Microsoft – 30
- EMC Corporation – 25
- Oracle Corporation – 23
- Broadcom – 18
- Symantec – 18
- HP (Hewlett-Packard) – 18
- Google – 17
- Sun Microsystems – 16
Cisco have also been spending a lot of money. Their deals include Arrowpoint Communications, ($5.7 billion, 2000), Scientific Atlanta ($6.9 billion, 2003) and WebEx ($3.2 billion) as well as Starent Networks ($2.9 billion, 2009) and Tandberg (reported $3 billion) in 2009. While this is enough in 2009 to make Cisco one of the primary acquirers by value in 2009, these are the only two deals they completed in 2009.
Bear in mind that these numbers are for a decade. The picture is different for 2009 where some less traditionally 'tech' businesses come in like Abbott Laboratories and Amazon.com:
- Oracle – 5
- EMC Corporation – 4
- Thomson Reuters – 3
- Google – 3
- IBM – 3
- CA – 2
- Barracuda Networks – 2
- NCR – 2
- Cisco Systems – 2
- Texas Instruments – 2
- Amazon.com – 2
- Abbott Laboratories – 2
- BakBone Software – 2
- Nuance Communications – 2
- Versata Enterprises – 2
- Sparxent – 2
- Informatica – 2
- Boku – 2
- Intuit – 2
- McAfee – 2
- Medtronic – 2
The public information released by Dow Jones does not give information about the specific deals or the values associated with them which makes seeing what has been missed tedious but there are a couple of implications for entrepreneurs.
- In reality, it is not very common to get bought by a large technology company. Over the course of the first decade of the millenium, over 258 companies were purchased by the 10 most active technology acquirers. That is an average of 26 per year globally. That is not very many acquisitions given there are probably 10,000 startups per year that are basing their exit strategy on an acquisition.
- To be part of the acquired group, you need to have customers, technology or something less tangible that an acquirer REALLY, REALLY, wants.
The List in 10 years from now
It is possible that 2009 shows the start of another trend and it would be fascinating to consider what this list looks like in 10 years time which would be really useful information to have right now.
I would expect to see Facebook, Amazon, Apple and Salesforce figuring as they move into more mature phases of their existences and drive into new markets. These would come, possibly at the expense of Sun (duh), Oracle (will probably need to make fewer bigger acquisitions as it reinvents itself), Symantec (future of cloud computing may have significant implications for the business) and HP.
Of course, like all predictions, others may have a view. Would love to know your thoughts on the Top Ten Tech Acquirers 2020. A bottle of champagne to the most accurate prediction!
Jajah bought by Telefonica for $207 million. Silicon Valley bought by European
Jajah, the Israeli founded IP telco that moved to Silicon Valley and has been rumoured to be in discussions with O2 and other major European Telcos has been purchased by Telefonica (owner of O2) according to the FT.
Lloyds Banking Group admits missing lending target
Lloyds TSB Bank admits that it has missed its lending target set by the government as part of its bailout. This will only come as news or a surprise if you are a senior banker or member of the government.
Plastic Logic closes $35 million financing prior to launching at CES
Venture funded Plastic Logic has closed a further round of $35 million from existing investors prior to launching their first product, the Que, at CES.
Abu Dhabi bails Dubai out with $10 billion
Abu Dhabi comes in with $10 billion to allow the Dubai government and Nakheel to service payment on Dubai World's non-interest paying Sukuk. Hands up if you are surprised? Thought so.
Real life eBay for Pirates. You can’t fault the enterprise.
Free enterprise is alive and well in Somalia, seemingly the spiritual home of piracy in the Horn of Africa. Just shows you will never know when evidence of entrepreneurial spirit will pop up and surprise you. This report from Thomson Reuters reports on the pirate exchange that has been set up in Haradheere, Somalia that enables locals to invest and profit from the activities of pirates operating off the coast. "Piracy-related business has become the main profitable economic activity in our area and as locals we depend on their output," said Mohamed Adam, the town's deputy security officer. "The district gets a percentage of every ransom from ships that have been released, and that goes on public infrastructure, including our hospital and our public schools."
Chelsea and Yorkshire Building Societies discuss merger
Well I suppose they have such similar cultures...
Whitfield Solar completes £2.7m funding round to drive commercial roll-out of its concentrated photovoltaic platform
Strata Partners advises Whitfield Solar Limited on a £2.7 million private placement. The funding round was led by an undisclosed private syndicate of new investors and supported by existing investors Carbon Trust Investment Ltd, the Cascade Fund and Kilsby Ltd.
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Economist to scrap print version
IMPORTANT!!!
Following a very interesting conversation with the good folks at The Economist today, (Thursday 19th November), I am more than happy to point out the The Economist has absolutely NO PLANS to scrap their print version.
I am very sorry if anyone who read this blog thought otherwise. The point of this post was to use, for rhetorical purposes, an example of a strong, influential, thoughtful and powerful print publication (with a circulation of over 1,000,000 and rising consistently over a 20 year period) and suggest that even they, may one day, move away from paper publications. Who knows whatthe future of digital paper, ebooks etc etc will mean for the world? If they ever did, AND THEY HAVE NO PLANS TO DO SO, they would still be a very powerful brand. Of course they have no such plans at the moment.
I also made the point that The Economist is a great brand and actually writes intelligent stuff. This is in contrast to the way that news spreads on Twitter. So Twitter users have apparently stuck my headline into Tweets without reading the post and now some short attention spanned sensation seekers have the impression that The Economist has scrapped their print version. Oh dear. Fortunately, such Twitter users are unlikely to be part of the core readership of The Economist.
Sorry anyway. My bad.
Today Haymarket announced that the print versions of Revolution and Media Week were being scrapped and Media Week would be available in an online only version. At some point in the future the Economist will do the same.
The Economist will become more influential online.
It has a reputation and a brand predicated on insightful, intelligent analysis, whereas Revolution was churning out the same stuff that tons of other news organisations were, with increasing competition from free commentators. In a world filled with lots of free stuff, and in a world with a vast number of sources of the same insights, where news organisations sometimes measure, their value by being able to say, 'I broke a story 4 seconds before anyone else on Twitter', it is very meaningful to be able to show value -add analysis.
At a recent ecommerce discussion dinner we ran, Michael Ross argued eloquently that for online retail, 'Proposition was the new location'. The same argument holds true for news and editorially driven organisations.
If you go down the route of producing cheap mass-produced content and use 'eye balls' as your measure of success, you will leave yourself open to being taken out by others. Focus on real value add, understand your market and ensure you have a proposition that is focused on meeting their needs and your brand will continue to thrive.
Google is driving empty calories to news sights. They do better from the traffic that they know and manage themselves. I think this is why Tom Foremski has a great point about Google not necessarily being crucial to Rupert Murdoch's success in this post.
Our next open event is CEO Tales, 3rd December, London.
TiGenix acquires Orthomimetics, University spin out for £23.8 million
Orthomimetics, which span out of Cambrdge University in 2005 has been acquired by TiGenix for £23.8 million. With £5.65 million funding in 2006 from Schroders, Oxford Capital Partners and Caravel Capital alongside angels, it would be interesting to know how much the founders end up with.
O2 is now officially the UK’s biggest telco
BT span O2 out of BT in 2001. O2, now owned by Telefonica after an all cash £17.7 billion acquisition in 2006 now has 21 million mobile customers compared to BT's 19.4 million land line customers. It continues to grow and has added 1,000,000 subscribers in 2009 thanks largely to its exclusive contract to sell the iPhone in the UK. During this time, Orange, Vodafone, T-Mobile and 3 added a combined total of 400,00o subscribers. Will this growth continue? It seems unlikely given Orange started selling the iPhone this Tuesday and sold 30,000 contracts on the first day.
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Murdoch to block Google searches – many want to, no one has had the balls/been stupid enough
Word is that Rupert Murdoch is to block searches via Google and other search engines. "Madness!", some will say whilst others will be watching with great interest. Publishers, ecommerce and many others that rely on the Internet have long been very uncomfortable with the power that Google wields over them. While Google helps them get found, if they don't play, and pay, by the rules, they disappear. Google is constantly launching new initiatives to help consumers like Commerce Search that leave other businesses decidedly uneasy. Put simply and directly, many businesses would like to do without Google but don't feel they can. I am not sure Murdoch can, but it will be interesting to see him have a go.
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e-trader Announces Buyout of Koodos as Miriam Lahage Passes the Helm to Miranda Grubb
The e-trader group, announced its acquisition of the award-winning discount site, Koodos. One of the UK’s leading fashion e-tailers, the site offers consumer discounts of up to 80%. The deal, involving a part cash, part share consideration for an undisclosed sum, represents the next step in the company’s strategy to become the UK’s leading e-commerce business focused on the fast growing clearance and overstock market. Miriam Lahage, original CEO, will remain with the company for the interim to ensure a smooth transition as she passes over to Miranda Grubb, Managing Director of whatafind.com and new CEO of Koodos
STOP PRESS! Venture funds want highest returns possible. Shun early stage.
Intel Capital point out, quite rightly, that venture funds may be wary of start ups and early stage ventures in the future. This is simply because it is very hard to make money from them. As a general rule, the earlier stage you invest, the more likely you are to lose your money. The later you invest, (and the more money you have), the less skill is required to make your money work. In our view, the emerging kings and queens of the early stage investment world will be experienced entrepreneurs who have made money on multiple projects and are now bringing more than cash to a project. They will however have to be prepared to make mistakes that cost them along the way.
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