2016 average total return of IPOs was 23%, $15.2bn in tech M&A

why-so-serious

Investors are betting 2017 will be better. Renaissance Capital pointed out that the average total return of I.P.O.s in 2016 reached 23 percent, a sharp reversal from the negative 2.1 percent return of 2015 offerings and surpassing the 21 percent return of two years ago.

So says a startup IPO wrap-up from Meanwhile, in the enterprise tech space, Brenon over at 451 reviews 2016:

The number of enterprise-focused companies that have set sail to Wall Street this year is once again mired in the single digits. That’s a disappointment given the abundant IPO-ready tech vendors and a bullish investor base that has pushed the broader US equity market to record levels in 2016.

By our count, just eight enterprise tech firms have made it public on the two major US exchanges so far this year, matching the total from 2015.

Those companies:

Company Date of offering
SecureWorks April 22, 2016
Twilio June 23, 2016
Talend July 29, 2016
Apptio September 23, 2016
Nutanix September 30, 2016
Everbridge October 10, 2016
BlackLine Systems October 28, 2016
Quantenna Communications October 28, 2016

But, the reason isn’t a lack of exits, there’s been much M&A in tech this past year, as Scott says:

Total M&A spending on infrastructure management jumped 57% to $15.2bn, with the volume of transactions rising to 152 from 146 as we near the end of 2016.

There are some big chunks in there – like the weirdly structured HP/MicroFocus deal for HP’s Software and cloud software groups which was $8.8bn, but left HP owning 51% of the combined company…so whatever you call that kind of deal.

It’s be even more helpful to see what the profits/returns on these deal were. Brenon has this on those eight tech IPOs:

The valuation of these acquisitions underscores the fact that December dealmaking has featured more ‘value’ than ‘growth’ strategies. All five of this month’s biggest deals have gone off at less than 4.4 times trailing sales, which is the average multiple for the 50 largest transactions announced overall in 2016, according to the M&A KnowledgeBase. On average, buyers in December have paid 3.3x trailing sales, a full turn lower than they did in the previous months of the year.

Can’t get enough of that computer in your pocket

Nomophobia (/’noʊ-moʊ-‘foʊ-biː-ə/; noh-moh-pho-bee-ah): Fear of being without one’s mobile phone.

No-mobile-phobia, or nomophobia, is probably one of the great universals of the day. This newly minted word describes a real problem internationally, as we all grow ever more attached to the tiny devices that dominate our lives. The word appeared on both British and American captioning professionals’ lists.

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It’s Not the Economy, Stupid

Rational anaysis is hard to find in real life:

But in Elkhart, people have jobs they didn’t have six years ago, and they’re working more hours. Their homes are worth more than they were before Obama took office, on average, and their paychecks are fatter than they used to be. Yet Obama is, and will likely remain, the president who didn’t do anything right.

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Meddling with Apple and Chinese Manufacturing

A nice discussion that highlights the complexity id trade policy and, thus, rhe high risks of fucking it up. I like this critique of trade criticism:

What makes Navarro’s critique challenging is that it’s not wholly wrong, at least from the American worker perspective, yet it’s not particularly actionable.

So often, that last part is overlooked: you have to actually be able to on something, despite the past. Until we have time machines, finding flaws and suggesting how we should have fixed them is little use on its own. Sure, you need a good analysis of history to figure out what to do next, but it’s deciding what to do next, and doing it, that count.

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Cloud Foundry’s Vision: A Services Ecosystem that Transcends Containers

“What’s the whole point of Cloud Foundry? It’s an abstraction on infrastructure,” stated Kearns. “And really, if you net it even further down, the whole point is to absolve organizations — particularly, traditional, non-tech organizations — from undifferentiating heavy lifting. What that means is, working on things that are not relevant or differentiating for your business.

Also, much discussion of the history of service broker/registries.

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Pivotal Cloud Foundry 1.9 out

The new version of Pivotal Cloud Foundry (“PCF” as folks like to say) is out. It has a whole slew of updates across the board.

My selective highlights:

  • Google Cloud & Azure support, so you’re all multi-cloud ready (still with OpenStack, VMware, and AWS support).
  • Will run 250,000 containers concurrently; in addition to scaling based on  CPU usage, you can now auto-scale on HTTP Latency and HTTP Throughput.
  • Updates to Spring Cloud, Zipkin, and Spring Boot Actuators for diagnostic stuff.
  • MySQL updates, esp. for multi-zone support in AWS.
  • “Tasks” one time processes that are an initial cut at “serverless”
  • A slew of security updates.

See more – much more – features and details in Jared’s blog post wrapping the release up.

2% increase in IT budgets predicted

The big takeaway is that small increases in IT budgets are the new normal. Unlike previous recoveries, we have not seen a large jump in IT spending over the past five years. So if a CIO is only seeing a two or three percent increase this year, he or she should understand that is pretty much in line with other companies.

See more guidance charts on IT priorities, n=190.

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Puppet and containers

When we’re talking with customers about the value that Puppet brings to them, invariably we talk about the future, and the future in their mind in some ways includes containers. There’s a lot experimentation going on. There’s a lot of Docker work being done and container work being done, Kubernetes work being done on their laptops. The conversations we have with them is how does Puppet help you bring it into production, into mission-critical production? How do you keep it secure? How do you operate it? All of those things that we know how to do and have done with various kinds of infrastructure, whether it was OpenStack, whether it was virtual machines, whether it’s just server configuration. For us, we take the same approach to containers and are evolving our road maps to make sure that customers have the same benefits they’ve have had over the years now with containers or other technology.

From an interview with Puppets CEO, Sanjay Mirchandani.

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