Jan 23, 2012, 10:57 am EDT
The phrase “reality distortion field” (RDF) comes from Star Trek, but it also turns out to aptly describe what former Apple (NASDAQ:AAPL) chief Steve Jobs was able to do when communicating with his engineers: He had an uncanny ability to get them to believe they could do the impossible.
The RDF has, in fact, become a hallmark of Silicon Valley. And for the most part, it has been a great driver of break-out companies such as Google (NASDAQ:GOOG), eBay (NASDAQ:EBAY) and Facebook.
Yet it can get out of control, as noted in a recent piece in The New York Times. With huge amounts of venture capital sloshing around, it seems that just about any zany idea can get millions in funding. This is especially the case if the startup is in the way-cool social-networking space. Read
Jan 20, 2012, 1:17 pm EDT
Even though the IPO market was choppy last year — especially in light of the European debt crisis — we still saw some mega-deals in the tech space. They included operators like Groupon (NASDAQ:GRPN), Zynga (NASDAQ:ZNGA), LinkedIn (NYSE:LNKD), Pandora (NYSE:P) and Zillow (NASDAQ:Z).
Seeing opportunity, venture capitalists also got aggressive with their dealmaking. According to the MoneyTree Report — which is based on the analysis of PricewaterhouseCoopers, the National Venture Capital Association and Thomson Reuters — funding reached $28.4 billion across 3,673 deals last year. This represented a sizzling 22% increase in dollar volume over 2010.
If you drill down on the numbers, you’ll see that Internet companies saw lots of interest. The total investment amount came to $6.9 billion, up 24%. Keep in mind that it was the most active period since the dot-com boom. Read
Jan 20, 2012, 12:22 pm EDT
Patrick Salyer is the CEO of Gigya, which develops technologies to help companies manage their marketing campaigns across platforms like Facebook, Twitter and LinkedIn (NYSE:LNKD). It reaches more than 700 million users, and clients include Pepsi (NYSE:PEP), Verizon (NYSE:VZ), Sprint (NYSE:S) and Coca-Cola (NYSE:KO).
IPO Playbook recently had a chance to interview Salyer. Here are some of his thoughts on social media and trends for 2012:
How did you come up with the idea for the company?
Gigya was founded in 2006 in Tel Aviv by a group of Israeli technologists who saw social media not only as the “next big thing” but as a permanent shift in how people interact on the Web. We began as a company that connected websites to social networks, allowing social-network users (at the time, mostly MySpace users) to share embeddable pieces of content in their social profiles. Read
Jan 19, 2012, 1:25 pm EDT
Daniel Hom is a data analyst at Tableau Software, which develops cool applications that help to visualize data. He’s also an IPO junkie.
So Hom built an interesting chart for IPO Playbook that analyzes the price-to-sales ratios of social-media IPOs such as those for Groupon (NASDAQ:GRPN), HomeAway (NASDAQ:AWAY), LinkedIn (NYSE:LNKD), Pandora (NYSE:P), Zillow (NASDAQ:Z) and Zynga (NASDAQ:ZNGA).
The takeaway? The data show that investors got better returns if they focused on the most expensive companies! Then again, IPOs are often a good option for momentum players. Read
Jan 19, 2012, 12:51 pm EDT
It’s not too hard to develop a daily-deal site. All it involves are some basic e-commerce capabilities as well as an e-mail marketing system. The big problem is getting users and merchants to the site.
Based on a recent report from Daily Deal Media, 798 daily-deal sites shut down in the last six months of 2011 (on a global basis). Then again, this represented only a 7.61% drop in the overall numbers. Keep in mind that most of the closures were in Asia, which saw 1,348 sites disappear.
All in all, this should be good news for leaders such as Groupon (NASDAQ:GRPN) and LivingSocial. They definitely benefit from their scale and brand power. Still, they are likely to feel heat from other large players, such as Amazon (NASDAQ:AMZN) and Google (NASDAQ:GOOG). Read
Jan 19, 2012, 10:40 am EDT
While smartphones have seen tremendous innovation over the years, one area has lagged: voice quality. Some of the problems include handling the complexities of sound (such as background noise) and legacy network technologies.
But for Audience, founded a decade ago, this has been a nice opportunity. The company has turned into a leading player in mobile voice technologies. And now it plans to go public.
The underwriters include JP Morgan (NYSE:JPM), Credit Suisse (NYSE:CS) and Deutsche Bank (NYSE:DB). The proposed ticker symbol is ADNC. Read
A long-time follower of the IPO scene, back in 1999 Tom started one of the first sites in the space called WebIPO. It was a place where investors got research as well as access to deals for the dot-com boom. Tom also wrote the top-selling book, Investing in IPOs. In it, he covers all the aspects of analyzing an IPO, such as reading the prospectus, detecting the risk factors and understanding some of the arcane regulations. But don’t worry — if that process is too intimidating for you, thankfully Tom will do the legwork for you right here in the IPO Playbook blog.
