Many of our readers are Technology CEOs and institutional investors. If you wish to tell your company’s story, or a portfolio company story let us know. Beginning in 2019 we plan to occasionally profile Technology companies in these pages and on our CEORater Podcast. Send me a note directly at email@example.com. Thanks for reading!
Bundle Pricing Negotiations Are Preferable to Product Pricing Negotiations Vendors have far more leverage with customers when negotiating pricing for a bundle/platform of products and services as opposed to an a la carte negotiation. There’s a reason why cable providers sold content bundles for years – it was the optimal revenue and profit model -…
The CEORater Technology Founder CEO Index outperformed its peer group Year-to-Date through September 18th 2018.
The CEORater Technology Founder CEO Index returned 32.3% and 28.5% on a Weighted and Unweighted Stock Price Return basis respectively (click here for detail) during the January 2nd 2018 – September 18th 2018 period.
Cryptocurrency firms fell from grace (Chain and Lightyear merged to form Interstellar) as valuations and expectations got too far ahead of themselves for both the various “coin” firms as well as for blockchain – the distributed database technology that enables digital currency transactions. We are long-term bullish on each – particularly blockchain.
The crypto space isn’t the only sector that grew overheated as reality has set in to the autonomous vehicle space. Apparently robot cars won’t be shuttling all of humanity to and fro by 2025. We expect that autonomous vehicle startups will suffer a materially adverse impact to their respective valuations.
The two technology hype scenarios got us thinking about previous technology hype cycles. Thus, we created the TEK2day, CEORater “Technology Hype Curve” to visually represent an all too familiar pattern as it relates to hyping new technologies. Click HERE to download the Technology Hype Curve graphic.
For the Lamborghini Countach – the successor to the revolutionary Miura (our header image) – Ferruccio Lamborghini chose three of Lamborghini’s best and brightest. Then he did something revolutionary – he left them alone.
Openness and Adaptability
Elements of Lamborghini’s leadership style – openness and creativity – are congruent with our recent CEO personality research, particularly as it relates to dynamic, fluid segments of the technology industry (think Artificial Intelligence and Autonomous Driving) where creative approaches to problem-solving and adaptability are key success factors.
The Wall Street Journal recently published an article detailing the process by which Lamborghini brought the Countach to life. To access the article as it appeared in the WSJ CLICK HERE
Our recent CEORater Podcast on the subject is below.
Even more on the Miura (we all have favorites) courtesy of Petrolicious – “The Lamborghini Miura Is Still Untamed”
We created the CEORater Technology Founder CEO Index in 2017 in large part to illustrate our strong belief that founder CEOs are better qualified to lead Technology companies than are “hired” CEOs/ professional managers. The CEORater Technology Founder CEO Index returned 13.0% and 10.5% on a Weighted and Unweighted Return basis respectively (click here for detail) during the January 2nd 2018…
Our Hypothesis: Founder CEOs Will Outperform Over the Long-Term
We believe that founder CEOs will generally outperform non-founder peer group CEOs as well as broader benchmarks over the long-term. We believe this to be true both in terms of stock market returns as well as operating performance as measured by traditional financial measures such as Cash ROIC, ROE, ROA and Economic Value Added.
We recently created the CEORater Technology Founder CEO Index in part to help test our hypothesis. Over time we plan to operationalize the index to where investors may use it as an investment vehicle (stay tuned).
Founder CEOs tend to take a long-term view of the companies they created (their children). Where hired CEOs focus on the current quarter and year, many founder CEOs want their respective companies to thrive in perpetuity.
Legacy Matters to Founder CEOs
It’s about legacy for founder CEOs:
It’s why Jeff Bezos (AMZN) thinks about 50 year increments as opposed to quarterly increments;
It’s why Reed Hastings (NFLX) pushed OTT, original content and international investment when many investors wanted a U.S.-focused DVD distribution company;
It’s why Bill Stone (SSNC) has built one of largest FinTech companies during a period when much of the Capital Markets industry has become commoditized.
We reviewed Total Stock Returns over the January 3rd 2017 – February 8th 2018 period: