Incentivize Prospective Participants with A Seat at the Table MoviePass shut down on September 14th. We do not have first-hand knowledge of MoviePass’ ever-evolving business model. However, we do know that MoviePass never quite figured out how to properly incentivize movie theaters to drive audience participation. When building new network businesses, it makes sense to … Continue reading If You Build It They Won’t Necessarily Come
When is the correct time to sell your company? Many entrepreneurs and CEOs struggle with this question. A blueprint unfortunately does not exist. Below are signposts we have observed primarily across Application Software, FinTech, InsurTech, Information Services, IT Services and Technology-Enabled Services. The company participates in a mature end market and continued growth is dependent … Continue reading Is It Time to Sell Your Company?
Some years ago many insurance carriers wrote tranches of long-term care (“LTC”) life insurance policies which have proved to be toxic. These “toxic” LTC policies - primarily written between 1999-2004 - were at the heart of a scathing critique of General Electric (tkr: GE) last week which ultimately accused the company of accounting fraud. While … Continue reading Toxic Long Term Care Policies: A Bane for Many. A Boon for Some.
We recently wrote that “Scale Matters in Tech”. Technology companies that have captured the number 1 or number 2 position within a particular vertical enjoy Economies of Scale including: 1.) automatically getting a seat at the table for sales bakeoffs, 2.) job seekers naturally gravitate toward market leaders, 3.) prospective acquisition targets will find you, … Continue reading Three Activist Investor Targets
One of the services we provide at CEORater includes a CEO Personality Profile derived from Natural Language Processing applied to earnings call transcripts. Research out of Stanford University - Charles OReilly and David Larcker - demonstrates a correlation between CEO Personality and company outcomes. Separate efforts apply similar analytic methods toward evaluating institutional investors. Institutional … Continue reading When Evaluating Institutional Investors Ferraris Are A Red Flag.
We tip our hat to LSE for thinking outside the box, moving beyond a commodity business to acquire a somewhat unique data set (one of the big three with Bloomberg and Factset). Blackstone Group (BX.N) acquired a majority stake in Refinitiv from Thomson Reuters (TRI.TO) in October 2018, valuing the company at the time at … Continue reading LSE to Potentially Acquire Refinitiv (fmr. Thomson Reuters Data Business) for $27 Billion
FTC slaps Facebook on the wrist and levies $5B fine. Combining legacy Facebook, Instagram and WhatsApp. A grand product strategy or slick tactical move to avert regulators? Facebook only found religion as it relates to user privacy after the FTC threatened to break up the company into three separate entities - 1) legacy Facebook, 2) … Continue reading Checkmate. Facebook Wins.
It has leaked that semiconductor giant Broadcom (tkr: AVGO) is working to acquire CyberSecurity software company Symantec (tkr: SYMC). Semiconductor investors are not fans of the deal as AVGO shares have traded off 6% since the news leaked. Conversely, we like the prospective acquisition for a couple of reasons: First, Symantec’s recurring revenues will help … Continue reading We Applaud Creative M&A Strategies
Much was made of Apple's chief designer Jony Ive stepping down last week. Rightfully so. What does it mean when companies aren't led by domain experts? "He’s not just a designer. That’s why he works directly for me. He has more operational power than anyone else at Apple except me. There’s no one who can … Continue reading When Companies Aren’t Led by Experts
We are sometimes critical of CEO compensation packages, yet we are first to admit that CEOs have an outsized influence on the future prospects of companies large and small. This is particularly true of fast-moving industries such as technology where having the correct CEO in place may mean catching the latest technology wave - cloud, … Continue reading CEOs – The Most Undervalued Investment Variable