Dear Clients and Friends,
The linked report focuses on our sense of M&A values and activities in the Enterprise Data & Analytics sector. We hope you find it useful. We live in interesting times.
A few weeks ago, Michael Dell proclaimed at the Web Summit in Dublin that the “data economy” is the next trillion-dollar opportunity. He preceded that statement by noting that “if you look at companies today, most of them are not very good at using the data they have to make better decisions in real time.” We couldn’t agree more with Mr. Dell.
In 2013, IBM famously observed that 90% of the information currently available was created in the last two years. Even more has been created in the most recent two, and the trend is accelerating as connected devices now outnumber people more than three to one. Production systems, CRM systems, financial records/transactions, social media, digital media, tablets, smartphones, autos, and household appliances are just a few sources of this exponentially growing volume of data. But harvesting this data, finding relationships between data sets, and deriving insights from the data is still challenging for many. The challenge gets no easier as the volume of data and the number of potential data sources proliferates. A group of companies providing Business Intelligence has emerged to help and change the way businesses make decisions: from the way sales people target prospects, to the way doctors treat patients, to driving boardroom decisions.
A recent IDC report forecasts that this market will grow at a 26% compound annual growth rate to $41.5 billion by 2018. This may be one reason why Dell is paying $67 billion to acquire EMC. It is certainly a driver for several recent transactions in the space, including fund raises for Alteryx and Pyramid Analytics, as well as Zendesk’s acquisition of BIME Analytics. These firms, as well as others, such as Qlik, Splunk, and Tableau, are breaking down the barrier of big data, transitioning data analytics from IT-centric systems to self-service analytics applications designed for business users. Business Intelligence is providing solutions to conduct analysis on vast data sets while making analytics easier, faster, and cheaper.
We are bullish on this space, and are actively advising sellers, buyers, and investors on strategic transactions. If you have questions, please feel free to contact me or Jeff Trongone – our lead in this area.