During Intel Capital’s Global Summit, many of the corporate venturing units managing directors took the time to talk about what they are working on in their sectors. Below are quotes from some of the conversations which give a flavor of some of the many interesting investment themes Intel Capital is working on.
Keith Larson [click on link for conference photo], Intel Capital managing director in charge of the manufacturing and labs sector, said: “Phase-change memory is a big, important growing technology.” He said phase-change memory was “a leading candidate” to be used to make up for problems faced by “nand-based flash memory”.
Larson also said he expected more and more storage to move to personal devices, as storage capacity grew.
He added another interesting development was how the development of new materials is needed for the chip industry to keep pace with Moore’s law –the prediction by Intel co-founder Gordon Moore that the number of transistors on a chip will double every two years.
Rob Rueckert, Intel Capital managing director in charge of new devices and wearables, said: “You are already starting to see a lot of devices. In 2014 you will see thousands of devices, which you will get to choose from. We will be able to have computing in our jewelry or clothing and there will be plenty of choices to decide from.”
Rueckert added: “The wearable space will be defined by a variety of devices. Is Google Glass going to be successful? Are smart-watches going to be successful? This will be tested in the market.”
Rueckert explained: “Part of the reason Intel is focusing on wearables, is we will provide components to these devices at some point.”
Rueckert said: “Consumer fitness is where the early adopters are, with a lot of users in medical care and those tracking biomedical information.”
Ken Elefant, Intel Capital managing director in charge of security, said his sector is really hotting up with the recent initial public offerings of Palo Alto Networks, FireEye and Barracuda Networks demonstrating to investors the scale of returns that can be made. Elefant added deals like these are likely to remain common as the business case for the sector is strong. He said: “Companies have got to get better security. It is not just buzz, it is real dollars.”
Elefant said trends such as the move of enterprises to the cloud, the growth of data centres and the rise of smart-phones have complicated computing security. “There are more vectors for attackers to enter the enterprise. Companies are preparing the best they can.” He added this was both driving the opportunities for security companies as well as posing a real threat for the day-to-day functioning of many businesses and institutions.
Dharmesh Thakker, Intel Capital managing director in charge of cloud software and big data, said the unit had been pleased with its exit of cloud company DynamicOps to US-based software company VMWare last year. “The DynamicOps deal worked out very well for us… Now they are part of VMWare our relationship continues to deepen.”
Thakker said it is difficult to predict what will be hot next in his sectors: “White space opportunities often catch you from nowhere”
Thakker added: “We are scraping the surface of big data. Today we are in year one.”
Marcos Battisti, managing director for Western Europe and Israel, also gave a spirited interview, outlining to the European press pack his views on why Western Europe has weak venture returns, despite having grass-roots innovation which compares favourably to many areas in the world. Global Corporate Venturing has previously detailed Battisti’s views, that express concern about the general ecosystem, which make for compelling reading, especially as Intel Capital has invested $1.6bn in the region.
On a more positive note, Battisti also outlined his enthusiasm for France as an investment destination, as well as pointing to Isreal, the UK and the Nordics as regions which have historically done well, despite Europe’s mixed record in venture capital.
Uri Arazy, an Israel director at Intel Capital, said the semiconductor company had been an integral part in helping Israel develop its highly regarded entrepreneurial ecosystem. “I would argue when Intel came in, in a big way, they became the anchor for the Start-Up Nation. This setting up of an R&D centre in Haifa was a big, significant investment by a US company and became a role model for other companies.”
Arazy talked about Interlude, a media company investment Intel Capital unveiled at the conference. “This is a company set up by an Israel rock musician, who does not fit your typical profile of an engineering background. However, he was a tech geek and is extremely talented, and could revolutionise the way videos are being watched. It allows people to let a movie march in different directions. This encourages a much larger engagement time, providing more time for adverts and other things.”