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Archive for the ‘Economy’ Category

Guess who else wanted to buy Motorola?

Posted in Board Of Intellectual Capital, Business models, Economy, Investments, Market research, Strategy, Technology, tagged , , , , , , , on August 15, 2011| Leave a Comment »

Article from GigaOm.

Google may not have had much of a choice when it came to buying Motorola Mobility for $12.5 billion. If it didn’t, someone else would have and that would have put the company in an even bigger patent hole.

Our sources say that Motorola was in acquisition talks with several parties, including Microsoft for quite some time. Microsoft was interested in acquiring Motorola’s patent portfolio that would have allowed it to torpedo Android even further. The possibility of that deal brought Google to the negotiation table, resulting in the blockbuster sale.

Motorola found a Google deal more digestible because Microsoft had no interest in running a hardware business and was essentially interested in Motorola’s vast collection of patents. Google moved aggressively, and at $40 a share, Google is now paying a 60 percent premium to Motorola’s recent stock price. The deal it struck gives it access to Motorola’s strong portfolio of 17,000 current patents and 7,500 patent applications across wireless standards and non-essential patents on wireless service delivery.

The high-level talks between Google and Motorola started about five weeks ago. Google CEO Larry Page and Motorola CEO Sanjay Jha were talking directly, and only a handful of executives were brought into discussions. Our sources suggest that Android co-founder Andy Rubin was brought into the talks only very recently.

My view is that while Google might have won the battle, in the long run it has put the Android ecosystem at risk. Mobile industry insiders view this as a ray of hope for Windows Mobile Phone 7 to sign-up the disillusioned handset makers who at this point must be reworking their mobile OS strategies.

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Apple flirts with ranking of biggest company

Posted in Board Of Intellectual Capital, Business models, Economy, Investments, Market research, Strategy, Technology, tagged , , , , , , , on August 10, 2011| Leave a Comment »

Article from SFGate.

“Apple sliced through the competition to briefly become the most valuable company in the world Tuesday, as its market capitalization surged past No. 1 Exxon before settling slightly lower.

The Cupertino company closed the day with its stock up 5.9 percent to $374.01 per share, valuing it at $346.7 billion. Exxon, the Texas oil giant, ended the day with a value of $348.3 billion.

It capped an astonishing turnaround for a company that founder Steve Jobs has said was weeks from bankruptcy when he returned as CEO in 1997 and focused the company on a handful of key products.

Apple’s stock price has gone up nearly 35 percent in the past year, reflecting heightened confidence among investors in its line of computers and mobile devices. In its most recent quarter, the company posted a record $28.57 billion in revenue as sales of the iPhone, iPad and notebook computers soared.

The company’s growth is particularly strong in the Chinese market, Apple Chief Operating Officer Tim Cook told analysts last month. International sales accounted for 62 percent of Apple’s revenue in the last quarter.

The company is expected to continue growing in the near term, analysts predict. A new iPhone is expected in the fall, and analysts say Apple might also introduce a lower-cost model that would help the company reach a lucrative new market.

Sales of the iPad continue to soar. Apple sold 9.25 million of the tablet computers in the last quarter, a 183 percent increase over the same period in 2010.

“On the iPad side, they’re so far ahead of the market that none of the Android or other tablet competitors have really made much of a dent in their market share,” said Charles Golvin, an analyst with Forrester Research. “‘Tablet is still essentially synonymous with ‘iPad.’ ”

It was less than two years ago that Apple joined the list of the 10 most-valuable U.S. companies. Since then, it has made a rapid ascent, surpassing Microsoft last year to become the world’s most valuable technology company.

Less than a month ago, Exxon was worth more than $50 billion more than Apple. Exxon’s market value declined as investors became pessimistic about prospects for economic growth, which drives demand for oil.”

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EBay’s Zong deal heats up mobile-payment battle

Posted in Board Of Intellectual Capital, Business models, Economy, Investments, Market research, mobile 2.0, Mobile Phone Usage, Strategy, tagged , , , , , , , , , , , , , , , , , , , , , , , on July 14, 2011| Leave a Comment »

Article from SFGate.

“EBay Inc.’s purchase of mobile-payment startup Zong Inc. for $240 million is stepping up pressure on companies such as Google Inc. and American Express Co. to make their own acquisitions in the market.

Google has held exploratory discussions with mobile-payment startups, according to two people with knowledge of the meetings. Credit card companies, including American Express and Visa Inc., also are meeting with takeover candidates, though deals may not be imminent, people familiar with the talks said.

More consumers are looking to pay for things like movie tickets, apps and other items with their phones – rather than cards or cash. That’s pitting financial-service providers, which benefit from transactions, against technology companies like Google. Both sides aim to use mergers and acquisitions to shore up their positions, said Richard Crone, who runs Crone Consulting LLC, a firm focused on mobile banking and payments.

“There’re much more M&A and roll-ups to come in this space,” Crone said. “You will see the activity happening before the end of the year.”

The total value of mobile payments will reach $670 billion by 2015, up from $240 billion in 2011, according to Juniper Research. That includes transactions for digital and physical goods, money transfers and payments using near field communication – a wireless technology that lets users tap their phones against a reader to make a purchase.

Mainstream acceptance

Many companies are shopping for startups that help users charge purchases to their phone bills. Within a year, 40 percent of all U.S. mobile subscribers will put items other than ring tones on wireless bills, according to Chetan Sharma, an industry analyst in Issaquah, Wash. That’s up from 30 percent now.

Potential acquisition targets include Boku Inc.; Payfone Inc.; BilltoMobile, which is majority-owned by Danal Co.; and Amdocs Ltd.’s OpenMarket Inc., Sharma said.

Syniverse Technologies Inc., MindMatics AG’s Mopay unit, Bango and Vindicia Inc. could be candidates as well, according to Crone. Acquisition targets will sell for 10 to 20 times their trailing 12-month sales, he said. It’s unclear how that measures up against the Zong deal because eBay didn’t disclose the startup’s revenue when it announced the purchase last week.

Still, some startups may struggle to attract a deep-pocketed suitor or land that kind of premium. And large technology and finance companies may choose to develop the capabilities themselves.

‘Pressure to act’

Representatives from Google, American Express and Visa declined to comment on any potential deals, as did Bango, Boku, Payfone, Syniverse and Vindicia. OpenMarket didn’t respond to requests for comment.

Ingo Lippert, CEO of Palo Alto’s Mopay, said the Zong deal will likely give rise to more acquisitions, though his company is “solely focused” on operations.

“We’ve been forecasting consolidation within the mobile-payments space for some time,” Lippert said in an e-mail. “With Zong’s acquisition, companies testing out solutions within the mobile-payments market will now feel increased pressure to act.”

Investments in payment startups began picking up several months ago. In February, Visa agreed to spend about $190 million, plus performance incentives, to purchase PlaySpan Inc. The company handles purchases of virtual goods in online games and social networks. In April, American Express led a $19 million funding round in Payfone, a developer of a mobile-payment service.

EBay’s buying spree

Last year, eBay acquired Red Laser and Milo, two comparison-shopping applications that allow users to scan product barcodes and read reviews. With Zong, the company will get a bigger foothold for its PayPal payment service on phones, especially in developing countries.

Zong lets people pay for things by putting them on their mobile-phone bills. That’s attractive in emerging markets, where credit card adoption is low.

“The phone is ubiquitous, and credit cards are not,” Rodger Desai, CEO of Payfone, said.

U.S. carriers lets third-party services such as BilltoMobile operate on their networks. Verizon Wireless, for instance, allows charges of as much as $25 a month. BilltoMobile also declined to comment on whether it was a takeover target.

Carrier bills contained $3 billion worth of charges for virtual goods last year, and these charges are rising at 38 percent annually, Crone estimates. Those purchases can include ring tones, dating-site subscriptions and weapons for mobile video games.

Purchases of apps charged to wireless bills reached $5 billion last year and are growing at 68 percent a year, Crone said. Consumers in countries such as South Korea are increasingly charging physical goods to carrier bills as well.

“We are seeing very rapid growth,” said Jim Greenwell, CEO of BilltoMobile.”

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Zynga S-1 highlights cloud as competitive advantage

Posted in Board Of Intellectual Capital, Business models, Economy, FaceBook, internet, IPO news, Market research, Social Networks, Strategy, Technology, tagged , , , , , , , , , , , on July 4, 2011| Leave a Comment »

Article from GigaOm.

“In some cases, cloud computing is merely a means to avoid investing in “undifferentiated heavy lifting,” but when done right, it actually can be a source of significant competitive advantage. So says Zynga, at least, which highlighted its unique cloud infrastructure, as well as its advanced analytics efforts, as part of its core strengths in the S-1 statementit filed this morning.

According to the form, Zynga views its “scalable technology infrastructure” as a core strength, stating, “We have created a scalable cloud-based server and network infrastructure that enables us to deliver games to millions of players simultaneously with high levels of performance and reliability.” In describing its cloud infrastructure as an important aspect of its business, Zynga’s S-1 says:

Our physical network infrastructure utilizes a mixture of our own datacenters and public cloud datacenters linked with high-speed networking. We utilize commodity hardware, and our architecture is designed for high availability and fault tolerance while accommodating the demands of social game play.

We have developed our architecture to work effectively in a flexible cloud environment that has a high degree of elasticity. For example, our automatic provisioning tools have enabled us to add up to 1,000 servers in a 24-hour period in response to game demand. We operate at a scale that routinely delivers more than one petabyte of content per day. We intend to invest in and use more of our own infrastructure going forward, which we believe will provide us with an even better cost profile and position us to further drive operating leverage.

Zynga has been touting its Z Cloud infrastructure for more than a year, which reverses the conventional approach to hybrid cloud computing. Whereas many analysts initially assumed companies would use private clouds as a gateway to public clouds, Zynga uses Amazon EC2 as a staging ground before ultimately moving games onto private cloud resources. Essentially, Amazon’s cloud lets Zynga scale elastically and determine average traffic load and other metrics, so that it can optimize its internal infrastructure for each game’s specific needs.

The goal of this strategy is efficiency: Zynga doesn’t have to invest in more resources than necessary upfront, nor does it have to worry about underprovisioning resources or otherwise inadequately configuring them when it brings games onto its private cloud. In many cases, private clouds can cost less than public clouds for applications with fairly stable usage patterns, and they help companies meet various requirements around security and compliance. Zynga uses Cloud.com for its private cloud infrastructure, as well as RightScale as a management layer that makes for a uniform experience in terms of managing both public and private resources.

As is the case with every leading web company, Zynga also highlights its big data strategy as a key differentiator. Describing its “sophisticated data analytics,” the S-1 notes, “The extensive engagement of our players provides over 15 terabytes of game data per day that we use to enhance our games by designing, testing and releasing new features on an ongoing basis. We believe that combining data analytics with creative game design enables us to create a superior player experience.”

Cloud computing and advanced analytics are double-edged swords, though. As Zynga’s S-1 acknowledges, relying on publicly hosted cloud computing resources makes it vulnerable to service outages like Amazon Web Services’ infamous April 2011 outage, which temporarily downed both FarmVille and CityVille. “If a particular game is unavailable when players attempt to access it or navigation through a game is slower than they expect, players may stop playing the game and may be less likely to return to the game as often, if at all,” the form states.

Relying on advanced infrastructures and analytics also means competing with companies such as Facebook, Google and others for employees skilled enough to keep Zynga’s operations on the cutting edge. Specifically, the company acknowledges, “game designers, product managers and engineers” are in high demand, making attracting and retaining them a resource-intensive process. In some cases, this has meant offering particularly attractive employees lucrative stock options, which could come back to bite the company. As it notes in the S-1, “[W]e expect that this [IPO] will create disparities in wealth among our employees, which may harm our culture and relations among employees.”

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Access to Brazilian markets – distribution, manufacturing, licensing – June 2011

Posted in Board Of Intellectual Capital, boic, Business models, Economy, Gerbsman Partners, Inetellectual Property, Intellectual capital, Investments, Life Science, Market research, Marketing, Medical Device, National Venture Capital Association, Technology, Venture Capital, Venturebeat, tagged , on June 28, 2011| Leave a Comment »

Based on the strategic growth and access to the Brazilian market, Gerbsman Partners has established a “strategic relationship” with a Brazilian medical device manufacturing and distribution company.   This 24 year old wholly owned family company, is seeking additional product opportunities in the medical device, technology and low tech areas, for manufacturing, licensing and/or distribution.

With the significant growth in Brazil (190 million people) and South American and with The World Cup and The Olympics coming to Brazil, this BRIC country is growing at a significant pace and can offer US, Israeli and European companies “access” to a a highly desirable market.

The company presently is profitable, has no debt, complies with all local regulatory aspects, has international quality manufacturing certification for medical devices, a direct sales and distribution network in place, access to other European and Asian markets and strategic alliances with other Brazilian high and low tech Brazilian companies.

History

The company was founded in 1988 by a leading Doctor and Lawyer/Business Person and was the first company to manufacture and commercialize the Women’s Health Products (Disposable Vaginal Specula (instrument used by the Gynecologists to examine their patients) in Brazil.  Encouraged by the success of its first product, the company launched other disposable medical devices to substitute the reusable ones, i.e. Anuscopes, Sigmoidoscopes, Forceps, etc. For over 22 years the company has been the absolute leader in all the markets in which it competes.

The company is presently divided into 2 business units. The first one, the core of the company, manufactures and commercializes disposable medical products. The company has its own production plant and a solid distribution network throughout the country composed of its own sales team, distributors and sales reps. (5 sales reps and over 400 distributors).

The other unit was created in 2004 and distributes medical products from an American company focused on Women’s Health. This unit is seeking to identify additional products through licensing or manufacturing.

The company also exports to France, England, Poland, Chile, India and Portugal.

The company is building a new production facility to increase its capacity and also to be open and ready to opportunities of manufacturing new products in Brazil. The new facility will have 50.000 square feet divided as follow:

  • 7.000 square feet for plastic Injection
  • 6.000 square feet for packaging
  • 6.000 square feet for assembling
  • 15.000 square feet still open for new products/projects

The company has high quality and well preserved machines for plastic injection, extrusion, cervical brush manufacture, gloves and packaging.

The company has all the international quality certificates to manufacture and distribute medical products, i.e. GMP, ISO 9001:2008, ISO 13485:2004 and CE Mark and it is also in compliance with all rules and regulations of the local health agency called ANVISA. The company has no debt, is profitable and has sales revenues in excess of $ 16 million US dollars.  Along with the founders, the company has added their son to the executive team.  He is a recent MBA graduate in the US and has domain expertise in finance and engineering with major Fortune 500 companies.

As indicated above, Gerbsman Partners is seeking to identify interested companies seeking to access the Brazilian market in the medical device, technology and/or low tech areas.  This access would be through licensing, joint venture, distribution and/or manufacturing.

Please call me to discuss your interest and I will set up a dialog directly with the company.

Best regards

Steve Gerbsman

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