Technology & Cyber Strategy for the Mergers & Acquisitions Industry

Tech Venture Capital firms are tasked with sourcing the best companies with the most competitive technologies; however, they face the challenge of confirming the viability of their technology investment. VCs need to focus on verification of the target company’s proprietary platform as well as its infrastructure to ensure success. A good overview for understanding the technical due diligence needs is covering both Software / Hardware appraisal of all proprietary technologies is provided: Software code and language review including Web 2.0 platforms Scalability & compatibility assessment Competitive landscaping in direct sector Identification of risks and potential costs within target firm to reduce post-closing surprise expenses Existing technology infrastructure and operations evaluation to determine “IT health” of business-technology alignment Overall, it is critical to remember that the underlying infrastructure a firm uses to implement its key strategy will define how successful...

Let's face the obvious. VCs plain love SaaS! What's not to like? SaaS (Software as a Service) architecture has gained tremendous momentum in the software world as it is the evolution of the ASP model allowing a software delivery without the need for any local data or software installation. Any browser with a robust Internet connection is able to access the software and the clients are billed via a subscription model, hence the service part. No ownership, no installation, no maintenance. I recently vetted a SaaS company for a VC client of mine and the SaaS model & revenue model made an extremely compelling business case. For VCs looking to invest in companies with a scalable business model this is an ideal revenue structure as it generally involves a fixed cost of initial development and infrastructure then they can scale up for countless clients who also subscribe to their software. This is great but there is more to it as the architecture for SaaS comes in two bas...

No one who has ever worked in a corporate environment, much less been to business school, has ever avoided dealing with the infamous SWOT Analysis. SWOTs are meant to summarize the strategic positioning of a company and explain where they are and what steps they should take to be more effectual. In actuality, they are a very effective high-level tool for examining any company. I incorporated the SWOT technique into my own surveys of companies and created the T-SWOT or Technical SWOT analysis. The idea here is to easily and effectively explain to my VC clients what are the Technology-based positioning a company has. Each SWOT axis can be converted to technology standards and examines the tech functions of a company in a granular fashion. SWOT in an IT Context: Strengths - technical strengths in platform, infrastructure and management Weaknesses - who a firms software design and platform may weaken them and what they should do Opportunities - in the te...

New Collaborative Technologies Not-All-That-New The messaging industry is highly fragmented but includes very sizable markets such as Email Security (projected at $6.7Bn by 2013, E-mail Security Market, 2009-2013, The Radicati Group, 2009 ) & Instant Messaging (forecasted at over $12Bn by 2013, Mobile Messaging Futures 2009-2013, Telecoms Market Research, 2008 ). A new, possibly disruptive, class of messaging platform is emerging and many are wondering how it might affect the market size from an investment standpoint. These platforms are known as collaborative messaging which are cross-breed of email, IMing and real time interaction with others, the poster-child being Google Wave.  The advent of collaborative technologies has given new dimensions to real-time productivity and communications for users worldwide. This segment of technology includes platforms like Etherpad, Shareflow, Microsoft SharePoint & Google Wave which allow multiple levels of interaction on a rea...

Private equity and venture capital firms often face the threat of risk within their portfolio companies, but are not always certain of their portfolio firm’s competency in this area. Risk Management within Information Technology is especially critical as it affects all operations and the eventual value of a portfolio company. CSC, Inc . specializes in helping investment firms make the best technology decisions for their portfolio company’s technology needs. This article serves as a primer for PE & VC firms who must ensure that their investments are secure and may need to proactively engage the IT management of their portfolio company. This primer can act as a template for those IT managers that are tasked with developing an IT risk management plan and who need guidelines for the process. It will also provide examples of how to implement each step and a validation structure for the investment firm to follow the process. The pervasive nature of technology has increasingly...

Looking towards the future is an inevitable aspect of VC technology investing,and while we all dislike catch phrases or "trends-dujour", it is critical to understand the implications of the next looming step in Web evolution ( download this primer here ). Problem : The Internet is currently a jumble of data categorized for people BUT searched by computers . Solution : Create a system that allows computers to understand the meaning of the data the way people understand language like using words to form a sentence. Web 3.0 is the unification of disparate data systems thru standardization making the Internet intuitive for people and computers alike, hence, the "Semantic Web" which emphasizes the real meaning of data on the Internet. The goal is to treat data objects like ideas and real language thereby achieving the real meaning of the "information age". Here are the highlights of the direction of Web 3.0 and what it will mean to any V...

Another area of concern is the lack of appropriate tax incentive policy crucial to encouraging new business investment. Most Chinese based VC type firms pay exorbitant tax rates which discourages their operation thereby limiting new business investment.             The China economy is structured differently in many ways and they currently do not have the equivalent of a US NASDAQ system. VC backed firms must meet strict requirements in order to function on the current local stock market. Further, there is no way for institutional investors to trade shares in the existing public markets in China .   A domestic exit option for venture-funded companies does not exist which poses a critically difficult challenge for investment vehicles.             On a less technical note there are cultural differences to be acknowledged as well as accepted norms that are established...