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German software giant SAP bought the experience management platform Qualtrics for $ 8 billion before the unicorn went public in November 2018. Last weekend, however, he decided to outsource the experience management provider to finally get to the To go stock market. Analysts Ron Miller spoke to speculation about strategic issues on the SAP side, and concluded that this was more of an internal reset associated with the financial gain from a promising offer.
Qualtrics has already made the startup scene in Utah known to people around the world. Having grown strongly after the acquisition, it is now the largest IPO in the state's history. Here is Alex Wilhelm with more analysis in Extra Crunch:
According to the Bessemer Cloud Index, cloud companies with growth rates of 35.5% and gross margins of 71.3% have an enterprise value of around 17.3x compared to their annualized turnover.
Given Qualtrics' closeness to this average set of metrics (slightly slower growth, slightly better gross margins), 17.3 times the number is probably not far from what the company can achieve when it goes public. 800 million times $ 17.3 is $ 13.8 billion, far more than SAP paid for Qualtrics. (It is doubtful for you out there that Qualtrics has a lot of debt, even though it will have a lot of money after the IPO. Expect the company's enterprise value to be slightly below its future market capitalization.)
As a result, the markets estimate cloud companies so high today that even after paying a high premium for the purchase of Qualtrics before the public offering, the company is significantly more valuable today after only two years of growth.
Back to the era of the nation states
The tech industry is collapsing and reforming by national governments in a way that many of their leaders don't seem to have planned as part of scaling the world, whether they're TikTok's shrinking global footprint or leading tech CEOs Consider from Congress. If you flip through the numerous headlines on these topics this week, you will see a very clear message in the subtext: Every startup nowadays has to think more carefully about its place in the world in order to survive.
Big Tech depresses earnings expectations for the second quarter
Legislators argue that big tech must benefit from the pandemic and must be regulated
Secret documents from the US antitrust authorities reveal Big Tech's intent to control or destroy the competition
The commission structure of the Apple App Store was questioned at the antitrust hearing
Zuckerberg does not convincingly pretend not to be aware of the VPN scandal
In an antitrust hearing, Zuckerberg admits that Facebook has copied its competition
Before buying Instagram, Zuckerberg warned employees of the "struggle" to "oust" competitors
Tim Cook, CEO of Apple, asked about the removal of competing screen time apps in the App Store by the App Store
Google's Sundar Pichai grilled about "destroying anonymity on the Internet"
Bezos cannot guarantee anticompetitive activity because Congress is flabbergasting him
Amazon's hardware business does not escape Congress control
Time for TikTok:
India bans 47 apps that clone restricted Chinese services
After India and the USA, Japan wants to ban TikTok and other Chinese apps
Report: Microsoft in talks to buy TikTok's US business from China's ByteDance
The main arguments for a Microsoft TikTok connection;)
And last but not least for large platforms …
Australia now has a template that forces Facebook and Google to pay for messages
Distance work still receives large investments
This loosely defined sub-sector of SaaS has evolved from a mainstream idea in the startup world last year to a full mainstream idea in the world due to the pandemic this year. However, listed companies were some of the biggest beneficiaries (see previous point) and the measures regarding start-ups in earlier stages were less clear. Lucas Matney and Alex met six investors who focused on different areas of the room to get the latest information on Extra Crunch. Here is a brief description of the fundraising trends that companies of Elliott Robinson, an investor in the growth phase at Bessemer, are experiencing:
How competitive are remote working tooling venture rounds now?
Incredibly competitive. I think one of the dynamics I've seen is that the basket of remote work companies that are really performing right now puts high price expectations well ahead of the increase. Many of these companies did not plan to increase in the second quarter / third quarter, but with COVID tailwind they choose to increase to an often invisible valuation multiplier level.
Are the prices out of control?
I think it depends on your definition of out of control. The reality is that many of these companies are collecting money from their natural fundraising date for two reasons: First, they see a unique digital transformation and the introduction of remote working tooling solutions. Second, over the past nine months, so many investors have raised substantial funds that they want to invest in these companies – one of the few segments in which the tailwind is likely to continue to grow as COVID cases in the US continue to increase software value Props can face significant headwinds in an uncertain COVID world. Therefore, growth stock investors pay a high multiple to take a look at the category-defining RW app companies.
Haptics in a pandemic-stricken world
Haptics are a great type of ge-whiz technology, but the practical future of touch-based communication is pervasive – VR devices are suddenly more interesting, touchpads are less. Devon Powers and David Parisi are academics and writers focused on space, and they wrote a big guest post for theinformationsuperhighway this week, outlining some of the ups and downs of the decades-old concept. Here is an important excerpt:
Finding the right feel remains a challenge despite more than 30 years of dedicated research in this area. There is no evidence that COVID will accelerate the development of projects that are already in the pipeline. The fantasy of virtual touch remains seductive, but finding the golden mean between loyalty, ergonomics and cost will continue to be a challenge that can only be overcome through a lengthy process of trial and error in the market. And although haptic has immense potential, it is not a miracle cure to remedy the psychological effects of physical distance.
Oddly enough, a promising exception is to replace touch screens with a combination of hand tracking and haptic holograms in the air that serve as a replacement for buttons. This product from the Bristol-based company Ultraleap uses a series of loudspeakers to project noticeable sound waves into the air, which offer resistance when pressed and effectively reproduce the feeling of a push of a button.
Ultraleap recently announced that it will partner with the cinema advertising company CEN to provide non-contact haptic lobby advertising displays in cinemas in the U.S. that allow screen interaction without the risk of touch. According to Ultraleap, these displays will "limit the spread of germs and enable safe and natural interaction with content".
A recent study by the company found that more than 80% of respondents expressed concerns about touchscreen hygiene, which prompted Ultraleap to speculate that we are “reaching the end of the (public) touchscreen era”. Instead of initiating technological change, the pandemic provided an opportunity to advance the use of existing technologies. Touchscreens are no longer places of naturalistic, creative interaction, but spaces of contagion that must be avoided. In the ultraleap version of the future, we would touch air instead of contaminated glass.
Find the best investors for you: The TC List and Europe surveys
In terms of investors, theinformationsuperhighway was busy with some other projects to help you find the right ones faster.
First, Danny Crichton has released a third update for The theinformationsuperhighway List due to the ongoing flood of recommendations. In his words: “With more than 2,600 start-up recommendations – more than double our original data set – we have underlined a number of existing investors on our list and added 116 new investors who have been approved by the founders as investors against the grain and write Do these critical first checks and do venture rounds. "
Try it out and filter by location, category and stage to narrow down your pitch list. If you're a founder and haven't submitted your recommendation yet, Please fill out our very short survey. If you have any questions, we have put together a Frequently Asked Questions page that describes qualifications and logistics, some of the background to the list, and how to contact us.
Second, our editor-in-chief Mike Butcher conducts a virtual investor survey among European countries to help Extra Crunch get a clearer picture of what's going on in the continent's startup hubs in the middle of the world that are going crazy:
theinformationsuperhighway starts a new large-scale project to survey Europe's venture capital investors. In the next few weeks, we will concentrate on Europe's major cities from A to Z, Amsterdam to Zurich – and many points in between. It is part of a broader set of surveys that we conduct to help founders find the right investors. For example, here's the latest poll in London.
Our survey will cover how every European startup hub is doing and what changes the coronavirus pandemic is causing among investors. We'd like to know how your city's startup scene is developing, how COVID-19 is affecting the technology sector, and how your thinking will generally develop from here. Our survey is only about investors and Only contributions from VC investors are taken into account. The selection list of questions only requires short answers. However, the more you want to add, the better.
The deadline for entries is the end of next week, August 7th, and you can fill it out here.
He also wanted me to inform you that he would resume his personal travels as soon as possible. (I actually made it up, but he said it too.)
All about theinformationsuperhighway
Submit your pitch deck to Disrupt 2020 & # 39; s Pitch Deck teardown
Announcing the Disrupt 2020 agenda
Talk and disrupt virtual reality with Hopin founder Johnny Boufarhat
The theinformationsuperhighway Exchange: What is an SPAC IPO? – If you haven't read Alex's new weekly email newsletter.
In the course of the week
Connected audio was a bad choice
Stanford students short-circuit VC companies by investing in their peers
Bitcoin bulls run as prices rise above $ 11,000
Recruitment for diversity in VC
Build products that improve the lives of inmates
Six things venture capitalists look for in your pitch
VCs and startups consider the HaaS model for consumer devices
Teespring's comeback story
Cannabis VC Karan Wadhera on the reasons why the industry that has had a success last year is now on fire
Jesus, SaaS and digital tithe
Hello and welcome back to Equity, theinformationsuperhighway's venture capitalized podcast (now on Twitter!), Where we unpack the numbers behind the headlines.
We had the entire team this week: myself, Danny and Natasha on the microphones, and Chris was skippering as always.
Unfortunately we had to start correcting this week because I am 1) stupid and 2) see point one. But after overcoming the SPAC nuances (a greeting to David Ethridge), we had a full show with goodies including:
- The Y Combinator Demo Day will still be virtual and the upcoming iteration will also be live. The equity crew all agree that this is the right thing and probably more fun. And now the founders can also make a live event work up a sweat! What fun.
- Speaking of digital live events: Disrupt is just around the corner. And it will be great. Read more here.
- A group of Stanford Business School students assembles an investment vehicle to invest money in themselves. This is a good idea and very risky. Fortunately, Danny and Natasha had good things to say about the effort.
- Ro raised $ 200 million and all jokes that were inappropriate are Daniel's fault. The company's $ 1.5 billion valuation makes the news that its competitor Hims could go public through a SPAC, all the more exciting.
- I played a decent round: $ 20 million for Instrumental, a super decent startup that got me up.
- Facebook is still looking for ways to get to know growing startups better – this time by investing in venture capital funds.
- And finally, there were some hearings this week that you may have heard. We are working on something neat that you will love about this very topic. So stay up to date.
And that's equity for this week. We're back early Monday morning, so make sure you keep an eye on our social networks. Hugs see you soon!
Equity decreases every Monday at 7:00 a.m. and Friday at 6:00 a.m. So subscribe to us on Apple Podcasts, Overcast, Spotify and all casts.