Saturday, January 14, 2017

(The Big Disrupt) IPO: Why 2017's IPO market may look similar to 2016's

2016 was a dud year for the IPO market but Wall Street is particularly bullish about the prospects for IPO's in 2017 as they expect a number of unicorns (companies with a private valuation over $1 billion) to go public but Wall Street's expectations of a better 2017 seems based on hope than anything else. 

Who could blame Wall Street analysts and banks for hoping for a better IPO market this year as last year banks resorted to spending a whopping $85 billion in risky block trades  in the face of the worst IPO market since the crisis.  

Investment bankers and analysts  point to a number of companies planning go public next year as well as markets stabilizing after a turbulent year in 2016. However, Wall street's hopes for a better IPO market in 2017 are almost certainly going to be disappointed. 

While there is a steady stream of IPO ready companies and a strong demand for new blood in public markets, these companies have other options available to them to raise money under terms that are an awful lot more favorable than a IPO. A company going public means it becomes more subject to external scrutiny and more importantly, pressure from shareholders and analysts to meet quarterly expectations and focus on increasing shareholder value. Companies like Uber who can raise billions of dollars in the private market are prepared to wait before they IPO as they've seen  the pressure to meet quarterly expectations and increase shareholder value ruin many exciting startups in recent years from Groupon to Twitter. 

With this in mind, founders are more than happy staying private as they're not strapped for cash and the focus among VC's is growth based rather than current or future profitability. The only reason that unicorns like snapchat and Spotify look almost certain to go public in this year is because they're both in competitive markets and need the cash to compete in their marketplace due to presence to players considerably larger than they are. 

This should be bad news for VC's as traditionally IPO's have been a way to for VC's to make bank on their investments but with the IPO market in bad shape, M&A has been a solid market for VC's as tech M&A's made up for most of the activity in the total global M&A market for the last two years running.    

This run is likely to continue as companies, particularly in the tech sector, are flush with cash and are willing to use it to buy startups that helps them enter into new markets, improve or add to their current product or service, or simply consolidate their position in the market. Another and particularly important reason why this run is set to continue is that the tech M&A market is nowhere near as regulated as the IPO market which means there are less obstacles in the way of large exits for VC's 

The upshot of all this means that save the very possible IPO's of Snapchat and Spotify,  2017 will look a lot like 2016 as the IPO market spends another year in the doldrums. 

Thursday, January 12, 2017

(The Big Disrupt) CIO: Why 2017 is going to look a lot like 2016 for CIO's and CISO's

As terrible years go, 2016 was terrible for CIO's and CISO's everywhere as data breaches reached record levels. 2015 was no better and many were predicting 2016 to be worse but few could have predicted Yahoo's reporting a record data leak (on top of another mammoth data leak) or the effect hacking would have on the recent US election as the fallout of both events are sure to spill well into 2017. 

There isn't, or at least there shouldn't  be any CIO and CISO looking upon 2017 with a glass half full as all the problems that has made the last five years a living hell for CIO's and CISO  still exist and in some cases, are almost certainly going to get worse.  

A combination of low transaction costs in favor of hackers, cybersecurity talent shortages and the ever expanding amount of data collected by organizations in both the public and private sector were big reasons why 2016 was the year of the hack and why 2017 will almost certainly follow suit. All these problems are compounded by both companies and governments unwilling share information about breaches with each other which would help avoid the notable trend of enterprise level companies falling victim to the same exploits. 
Hackers on the other hand frequently collaborate and share new malware and exploits which has contributed to why the market for stolen data and malware is arguably the most vibrant and dynamic market on the net. As long as this persists, we'll continue to see a steady stream of news stories that have come to define the year past.  

2016 was trying for CIO's and CISO's but it was abysmal for cybersecurity as an industry as U.S officials openly talked about intervening. While it's not exactly clear whether governments can improve the level of cybersecurity, it's quite clear something has to be done as the industry is the picture of market failure. 2017 won't be any better as calls for the government to get involved will almost certainly get louder despite cybersecurity being a growth market in the face of record year on year spikes in data breaches. 

In sum, CIO's and CISO's know the year ahead will look like the year past and are painfully aware of how little they can do about it as while they do everything in their power to secure their organization's IT infrastructure, they're fighting an enemy that has all the advantages and they know it. This is an indictment of the sorry state of cybersecurity as an industry and its inability to find solutions to combat attackers effectively and should it continue, the most dangerous thing you do all day will be switching on your computer. 

Thursday, January 5, 2017

(Note to the reader) Happy New Year 2017

Dear Reader, 

Thank you for your support and readership of The Carnage Report as we enter our sixth year of operation and we wish you a happy and productive 2017. 

We're looking to make 2017 a big year for TCR as we plan to supply more engaging and high quality content from new as well established voices. We also plan to supply more articles, features, interviews, reviews and  videos at more than any point we have in the past. 

The last few years have been stop and start regarding content leading inconsistency but everyone at TCR is committed to making 2017 our most productive year yet.  

In sum, 2017 will be a big year for us and if we have everything to do with it, a great year for all of you who have stuck with us for this long. 

Thank you  for listening 

Alex Clarke 
Founder and Owner 
The Carnage Report 

Sunday, January 1, 2017

(sports) UFC: Is Ronda Rousey's MMA career over?

After falling victim to another crushing and comprehensive striking clinic this time at the hands of  UFC women's bantamweight champion Amanda Nunes, much lip service and keyboard pressing has been donated to the question whether her career was over and the consensus was overwhelmingly yes. 

On the face, it seems a fool's errand to argue otherwise given questions about Rousey's commitment to MMA given the myriad of  opportunities available to her outside the sport and the fact that Rousey has been severely outclassed twice in her last two bouts with both Holm and Nunes exploiting Rousey's bad footwork and poor head movement which would make promoting Rousey's next fight a real tough sell for the UFC. 

However, the only  argument that has any credence is that Rousey is now part of an improving women's bantamweight division at a time when her skillset has stagnated which. No one (and I mean no one) thought Rousey could compete with Nunes on the feet as Nunes is by far the superior striker and showed as much last night as Rousey seems unable to adjust or weather the barrage of strikes thrown her way by a ferocious Nunes. 

What was worrying however is that Rousey was making the same  technical mistakes (poor head movement, poor guard, bad footwork etc) she made during her crushing defeat to Holly Holm in Australia a year ago. Many have rightly pointed the finger at her much maligned coach Edmund Taverdyan who has been accused by many, including Rousey's mother, of being a terrible coach. 

Rousey looked like she was going lose the fight from the first clean punch she took and as the fight continued, it was painfully clear that she had neither tools or ability to avoid or stop the onslaught unleashed by Nunes.When a fighter has a gaping hole in their skillset, it's the coach's job to either fill the hole with or add another skillset to their fighter's game that at offsets the downsides associated with the weakness and this clearly didn't happen within the year Taverdyan had with Rousey to make sure his charge wasn't embarrassed so publicly again. 
Rousey may well quit MMA but if she plans to make another comeback, she has to make it without Taverdyan or face the ignomy and ridicule of three very embarrassing losses at the highest level. There is no shortage of world class coaches who could help Rousey at the very least address weaknesses in her striking such as the brilliant Rafael Cordeiro or Mark Henry or gyms that can help her become a more complete martial artist such as Tristar in Canada headed by the much respected Firas Zahabi or the Jackson Wink Academy headed by two excellent coaches in Greg Jackson and Mike Winkeljohn in New Mexico. 

Such a move would be a step in the right direction and would show that Rousey is looking to learn from her mistakes but given Rousey's stated premium on loyalty and propensity to take losses personally rather than learn from them, such a move looks unlikely to say the least.   

In sum, despite the industry wide consensus, Rousey can definitely comeback though her star power diminished but to so she may have to make changes, changes that elude her and leave what was once the brightest star in UFC's vast constellation a dimmer and less intriguing version of herself.


Related Posts Plugin for WordPress, Blogger...