Innovation in IT today goes beyond the sector itself, with substantial spillover effects across virtually all other sectors. Whether it is smart homes, smart cities, smart factories, the Internet of Things, connected vehicles or software optimised with artificial intelligence (AI) and machine learning (ML), digitisation and its disruptive potential seem omnipresent.
At the core of digitisation lies datafication and the rise of big data, as the ever-smarter internet-connected devices we use generate enormous streams of data. Harnessing the potential and unlocking big data, to extract relevant information and insights has been one of the major challenges.
According to a 2020 report by ResearchAndMarkets.com, the big data analytics market was estimated at $37.34bn globally in 2018 and forecast to reach $105bn by 2027 at a compound actual growth rate of 12.3%.
The expected growth will be driven more broadly by increasing volumes of data and the adoption of big data tools. The authors also note that the complexity and sheer quantity of data is clearly powered by mobile data traffic, traffic, cloud-computing traffic and the adoption of IoT and AI solutions by both consumers and businesses, noting that data are ballooning exponentially with over 2.5 quintillion bytes generated every day.
Big data tools are no longer just fancy new technology but are becoming mission-critical for big businesses and enterprises. According to a survey cited by the report, the number of firms investing more than $50m in big data and AI tools rose from 27% to 33.9% between 2018 and 2019 alone. Global spending on big data analytics was estimated at more than $180bn in 2019. In 2020, 90% of surveyed business professionals said data and analytics were key to their organisation’s digital transformation.
Handling massive big data streams is unthinkable without the power of AI, which is the other major factor in IT innovation globally. The media first popularised buzzwords like “artificial intelligence”, “machine learning” and “deep learning” (DL) a few years ago and they have become part of everyday business vocabulary. AI refers to any instances of a machine performing tasks characteristic of human intelligence – from recognising objects and images through speaking languages to problem solving. Machine learning is a specific kind of AI where a machine learns to perform a task without having been explicitly programmed to do so. Deep learning, in turn, is an approach to ML, inspired by the functioning of neural networks in the human brain.
Natural language processing deals with extracting or generating meaning and intent from texts in a natural, readable and grammatically correct form. “Computer vision”, another branch of AI, is similar, but from visual elements, whether characters in text documents or faces and objects from images.
AI and ML are already yielding measurable results for businesses. Even studies from a few years ago, like the 2018 State of AI report by consulting and auditing firm Deloitte found nearly 83% of organisations were seeing either “moderate” or “substantial” benefits from cognitive technologies. For companies across sectors, the median return on investment from cognitive technologies, was 17% in 2017-18. The respondents also reported that AI’s greatest benefits were enhancing current products, optimising internal operations and making better decisions.
More recent reports suggest slight retrenchment, such as the 2020 AI predictions by consulting firm PwC. The primary reason for it is “the need to focus on fundamentals before enlarging AI projects”. However, the consultancy does note that 90% of American executives “believe that AI offers more opportunities than risks, and nearly half are expecting AI to disrupt either their geographical markets, the sectors in which they operate or both.” PwC also estimates the potential contribution of AI to the global economy by 2030 to be $15.7 trillion, which would lead to a up to 26% boost in gross domestic product for local economies.
Most interesting and controversial are questions on AI side-effects on the economy and, particularly, on human labour. While we still appear to be a long way from a robot-dominated planet, AI is set to drastically augment human productivity in the next decades. However, much of this will likely be accompanied by Schumpeterian “creative destruction”, need for reskilling of the labour force and, naturally, feelings of fear and rejection. According to a survey cited in the 2019 Global Human Capital Trends by Deloitte, 38% of respondents expected technology to eliminate jobs at their organisations within the next three years, while only 13% thought automation would “eliminate a significant number of positions”.
The impact of Covid-19 may be the catalyst for a more peaceful transition of the labour force to an AI-powered future. According to the 2020 Global Human Capital Trends by Deloitte, the health crisis may have given a glimpse of the way forward: “Covid-19 showed people that while technology can augment and supplement work, it does not replace what is needed from humans. The health crisis gave people a greater appreciation for the fact that humans and technology are more powerful together than either can be on their own. Consider how telemedicine, manufacturing, education, and even grocery delivery drew on the power of integrated human-machine teams during the crisis.”
While the successful combining of humans and machines to battle a global crisis is a positive, there remains be a need for workforces to improve their skills. In 2019 survey from Deloitte, 84% of respondents thought automation would require reskilling and were increasing investment in retraining.
In 2019, Amazon announced that it would spend $700m to retrain about 100,000 workers in the US by 2025, helping them move into more highly skilled jobs. At the time, the New York Times observed that Amazon was acknowledging “adances in automation technology will handle many tasks now done by people”. And there are different estimates of the potential impact of AI: up to 20 million manufacturing jobs worldwide may be lost to robots by 2030 (Oxford Economics); between 40 million and 160 million women worldwide may need to transition between occupations by 2030 as clerical work, still overwhelmingly done by women, is an area especially susceptible to automation (McKinsey Global Institute); automation is expected to displace 75 million jobs but generate 133 million new ones worldwide by 2022 (World Economic Forum).
Despite the potential social impact, with the strong tailwinds for AI, it is perfectly conceivable it will continue to open opportunities for many emerging businesses, as it has during the latter part of the last decade.
Digitisation inevitably brings significant digital threats that are addressed by the cybersecurity sub-sector. Its market growth has been driven by the adoption of digital technologies across a wide range of industries as well as the increased use of internet-connected mobile technologies by consumers in the past decade. In parallel, cyber-attacks have also become more sophisticated. As analyst Steve Duplessie, founder of Enterprise Strategy Group, once said: “Cybersecurity is a magnificent market because the problem can never be solved entirely. Fix one hole, the bad guys find another. It is a ping-pong match for hackers.”
This is likely to hold true even more in the post-pandemic world, with more people expected to work remotely. According to research by Centrify, 71% of UK-based business decision makers believe the shift to remote working has increased the likelihood of cyber-attacks.
According to estimates cited by Forbes magazine, the global cybersecurity market was estimated at $173bn in 2020 and expected to reach $270bn in the next five to six years, noting that “77% of cybersecurity spending will be for externally managed security services”. According to Forrester Research, enterprises are expected to deploy $12.6bn on cloud security tools by 2023, up from $5.6bn in 2018. Morgan Stanley Research expects global IT security expenditures to reach $128bn, with endpoint security tools being 24% of all cybersecurity spending.
With its burgeoning data and connectivity of everything, today’s digitised world would be impossible without cloud computing and cloud infrastructure. Many data-driven and data-dependent businesses have either moved operations completely to the cloud or reduced their operational expenses on private data centres.
The 2020 State of the Cloud Survey, conducted by tech asset management solution provider Flexera, found that “enterprises continue to embrace multi-cloud and hybrid cloud strategies and are already using more than two public and two private clouds on average.” It also points out that 93% of companies have a multi-cloud strategy and 87% have a hybrid cloud strategy.
The Flexera survey also found that cloud spending will increase: “Respondents expect to increase cloud spend by almost 50% this year, but they still struggle to forecast spend accurately as they significantly exceed their cloud budgets. As a result, optimising existing cloud use remains at the top of companies’ 2020 priority list for the fourth year in a row, followed by migrating more workloads to the cloud. A majority of enterprises expect to increase cloud usage due to Covid-19.”
While business operations migrate to the cloud, individual consumers are moving to a new space, enabled by virtual reality (VR) and augmented reality (AR) technologies. It is unclear at present whether and to what extent the two technologies may converge or diverge in the process of becoming more marketable. According to a report by research firm IDTechEx, the combined markets of VR, AR and mixed reality (MR) are growing, and the three together were expected to reach beyond $30bn by 2030.
According to the latest 2020 Augmented and Virtual Reality survey of consulting firm Perkins Coie, boom times may be ahead for the industry, with nearly 200 professionals representing startups, enterprise technology firms and investors all expressing strong optimism. The report notes: “Immersive gaming is set to continue growing, but other, broader uses are too – meaning there can be no doubt that the market for XR technologies is growing and maturing at a rapid pace. The advent of smart city initiatives by governments and business, and technology advocates around the world are also leading the charge for increased XR adoption and market growth. The survey results show that North America and Asia are ahead of the pack in pioneering those initiatives and that city size is not the only factor driving leadership in the area.”
On the hardware side, it is chips and semiconductors that enable sufficient computing power for all these developments in the sector. Before the Covid-19 crisis, worldwide semiconductor revenue had declined 12.2% in 2019 to $418bn, according to consultancy International Data Corporation (IDC), attributable to US-China trade tensions which grounded semiconductor demand. IDC noted: “Higher levels of inventory in specific areas like mobile phones and cloud infrastructure brought pricing pressure and negatively impacted semiconductor sales. Driving the downturn were declines of 37.3% and 27.7% in the DRAM and NAND markets, respectively, after more than two years of strong growth.”
After the pandemic broke out, market research firm Gartner forecast that due to its impact on semiconductor supply and demand, global revenues would decline 0.9% in 2020. Richard Gordon, research practice vice-president at Gartner, said: “The wide spread of Covid-19 across the world and the resulting strong actions by governments to contain the spread will have a far more severe impact on demand than initially predicted…This year’s forecast could have been worse, but growth in memory could prevent a steep decline.” The non-memory segment is expected to decline by 6.1%, while memory will grow by 13.9%.
Edge computing is another growth sector which has been driven by digitisation and the rise of IoT. It is defined as a distributed form of computing which brings computer data storage closer to the location where needed. Computation is performed, mostly or entirely, on distributed device nodes. According to a report by ResearchAndMarkets.com, the global market size is anticipated to reach $43.4bn by 2027, a CAGR of 37.4% over the forecast period. We therefore expect to see more corporate-backed deals in this area.
For the period between June 2019 and May 2020, we reported 660 venturing rounds involving corporate investors from the IT sector. More than a third of them (273) took place in the US, while 110 were hosted in Japan, 76 in China and 36 in India.
The majority of those commitments (250) went to emerging enterprises from the same sector, mostly enterprise software, cybersecurity, big data analytics and AI technologies. The remainder went into companies developing other technologies in synergy with IT sector incumbents: 106 deals in the services sector (mostly human resources tech and edtech), life sciences (mostly healthcare IT and pharmaceuticals) and financial services (payment tech, insurance tech and alternative lenders).
The co-investments of IT corporates show the broad variety of investment interests of the sector’s incumbents. The commitments range from data services and analytics (Trifacta, Portworx, Weka.io) and AI and ML enterprise solutions (4Paradigm) through semiconductor tech (Inrpria) and quantum computing (IonQ) to 3D printing (Desktop Metal), IoT networks (FogHorn Systems) to HR services software (One Visa).
On a calendar year-on-year basis, total capital raised in corporate-backed rounds went down from $39.68bn in 2018 to $34.93bn in 2019, representing a 12% decrease. The deal count, however, grew, by 12%, from 592 deals in 2018 to the 665 tracked by the end of last year.
The leading corporate investors from the IT sector in terms of largest number of deals were diversified internet conglomerate Alphabet, internet company Tencent, cloud-based enterprise software provider Salesforce, and electronics manufacturer Samsung. The list of IT corporates committing capital in the largest rounds was headed by also by Tencent, Alphabet and software developer Microsoft.
The most active corporate venturing investors in the emerging IT businesses were Alphabet, chipmaker Intel and Salesforce.
The emerging IT businesses in the portfolios of corporate venturers came from data tech (NS1, Sight Machine, Data Robot), cybersecurity (Spark Cognition, CyberGRX) through imagine processing (Orbital Insights) to semiconductor technologies (Wiliot).
Overall, corporate investments in emerging IT-focused enterprises went up from 552 rounds in 2018 to 641 by the end of 2019, suggesting a 16% increase. The estimated total dollars in those rounds also grew by nearly 18% from $18.86bn in 2018 to $22.21bn last year, suggesting that valuations of emerging tech enterprises were clearly on the rise.
Deals
Corporates from the IT sector invested in large multimillion-dollar rounds, raised by enterprises from a variety of sectors including services, transport, fintech and consumer. Five of the top 10 deals stood above the $1bn mark.
Tencent invested $2bn to lead a $3bn series F round for China-based short-form video streaming platform Kuaishou. Private equity firms Boyu Capital and Yunfeng Capital, venture capital firm Sequoia Capital and Singaporean government-owned investment firm Temasek also participated, which will reportedly value the company at approximately $28.6bn. Founded in 2011, Kuaishou has created an online platform where users can upload, watch and share short-form videos. Its biggest competitor is TikTok, which is owned by digital media company ByteDance. The series F round was intended to be the last Kuaishou raise before launching an initial public offering.
China-based real estate platform operator Beike Zhaofang (also known as Ke.com) received roughly $2.41bn in a series D-plus round, featuring telecoms and internet conglomerate SoftBank, which contributed $1bn, as well as Tencent. Other participants included real estate platform hedge fund manager Hillhouse Capital and VCl firm Sequoia Capital China. The round reportedly valued Beike at slightly more than $14bn. Launched in 2017 by Lianjia, Beike has developed an online platform which provides users with access to apartments for rent that span almost 100 Chinese cities. The platform uses 3D modelling technology to enhance the online viewing experience and is looking to build a 200 million-strong customer base spanning 300 Chinese cities. It also offers services such as interior decoration, property management and real estate financing.
Alphabet was among the investors that provided $2.25bn in funding for its US-based autonomous driving technology spinoff, Waymo. Silver Lake, Canada Pension Plan Investment Board and Mubadala Investment Company co-led the round, which also featured automotive component manufacturer Magna International, car retailer AutoNation, which invested $50m, and venture firm Andreessen Horowitz. The capital was the first external financing to be raised by Waymo, which is working on a unified autonomous vehicle that will combine internally developed technology in areas like cameras and lidar sensors with versions of traditional automotive systems covering functions like brakes and steering. The company was originally developed internally at Alphabet (then Google) through its moonshot technology development subsidiary, Google X, before becoming a standalone business in 2016.
Microsoft invested $1bn in US-based AI research technology provider OpenAI in a bid to enhance its own work on artificial general intelligence (AGI) technology. Founded in 2015 and overseen by a non-profit organisation, OpenAI is working on research that is intended to harness AI in responsible ways. The company is most focused on AGI, which could combine extremely high-level knowledge of many fields to devise solutions to complex problems. Microsoft intends to leverage the partnership to enhance its cloud computing platform, Azure, making it better equipped for use in supercomputing and large-scale AI systems, and allowing it to create and deploy more advanced AI models.
Tencent co-led a $1bn series G round with investment management firm Hillhouse Capital in China-based online education platform Yuanfudao. Private equity firm Boyu Capital and VC group IDG Capital also participated. The funding was reportedly raised at a $7.8bn valuation. Tencent was a returning investor. The Series G boosted Yuanfudao’s overall funding to about $1.54bn. The company plans to channel the funding into improving the user experience, while ramping up R&D on AI.
Spun out of social media platform Fenbi in 2014, Yuanfudao provides app-based tutoring services that include live courses, homework help and mock exam problems, covering primary and secondary school age. Parents can also use track their child’s learning.
Singapore-headquartered on-demand ride provider Grab secured $856m in funding from IT services provider TIS Intec’s TIS subsidiary and financial services firm Mitsubishi UFJ Financial Group (MUFG). MUFG provided $706m for the company while TIS invested $150m. News of the round came as Grab was reported to be in talks to merge with Southeast Asia’s other large ride hailing service, Gojek, in a deal that would value the joint company at $23bn. Grab runs an on-demand transport service spanning 339 cities across eight Southeast Asian countries, offering food and package delivery, as well as payment services, lending, wealth management and insurance through the Grab Financial Group subsidiary it launched in 2018.
US-based digital payment tech provider Stripe increased the size of its series G round to $850m after it scored an additional $600m from a host of investors featuring GV, the corporate venturing unit of Alphabet. Remaining investors included VC firms Andreessen Horowitz, General Catalyst and Sequoia Capital – all of which had already taken part in its first $250m close in September last year. The funding was reportedly provided at the same $35bn pre-money valuation and it is meant to support growth in the company’s operations as it deals with large amounts of offline commerce migrating online due to the Covid-19 pandemic.
Founded in 2010, Stripe has developed a mobile platform that enables online merchants to accept payments and oversee their businesses more effectively by providing assistance with functions such as fraud detection, revenue management and international expansion.
Automotive manufacturer Toyota Motor Corporation led a $590m series C round for US-based airborne taxi developer Joby Aviation with an investment sized at $394m. The round also featured Toyota’s strategic investment vehicle, Toyota AI Ventures, as well as Intel Capital and JetBlue Technology Ventures, investing on behalf of Intel and airline operator JetBlue respectively. Asset manager Sparx Group, investment firm Capricorn Investment Group, VC firm AME Cloud Ventures, investment management firm Baillie Gifford and family office Global Oryx filled out the round’s participants. Joby is working on a five-seat vertical take-off and landing vehicle that will be able to carry passengers short distances in urban areas. It will be electric-powered and is expected to be able to travel some 240 kilometres on a single charge.
India-based business e-commerce marketplace Udaan secured $585m in a series D round featuring Tencent and financial services firm Citi. Altimeter Capital, Footpath Ventures, Hillhouse Capital, GGV Capital, Lightspeed Venture Partners and DST Global also took part in the round, which valued the company somewhere between $2.3bn to $2.7bn, a person familiar with the matter told TechCrunch. Citi invested through its Citi Ventures unit. Udaan operates an e-commerce platform that connects a network of about 25,000 large wholesalers and traders to a customer base of about 3 million smaller businesses, such as restaurants, farmers or local shops, facilitating the distribution of a wide range of consumer goods. Buyers and sellers can also access credit and working capital through the platform, and Udaan runs a supply chain network that supports delivery. The series D cash will allow both services to be strengthened as it adds more product categories to its offering.
China-based online tutoring platform VIPKid closed a series E round led by Tencent that was reportedly worth as much as $500m. Tencent was thought to have committed $150m to the round, although the corporate had briefly withdrawn its support previously. VIPKid was reportedly targeting a $4.5bn valuation for the round but did not confirm any financial terms.
Founded in 2013, VIPKid maintains an online education portal that enables Chinese pupils to take English lessons with tutors in North America through one-on-one video chats. The service had grown to 700,000 students and 90,000 teachers. VIPKid also operates Lingo Bus, which runs immersive online courses for children to learn Mandarin Chinese, and SayABC, which relies both on tutors and interactive content such as games to teach children English. The funding will allow VIPKid to drive content and technology development and recruitment, as well as improve operational and organisational efficiencies.
There were other deals in IT enterprises backed by corporates from outside the sector.
US-based data analysis software provider Snowflake secured $479m in a series G round co-led by Salesforce’s corporate venturing arm, Salesforce Ventures, and investment firm Dragoneer. The round was backed by Altimeter Capital, Redpoint Ventures, Sequoia Capital, Iconiq Capital, Madrona Venture Group and Sutter Hill Ventures. Founded in 2012, Snowflake has created a cloud-based platform that allows users to search for data from their own internal applications and cloud services providers. It also enables users to create their own data exchange, allowing them to securely share data with others. Salesforce invested through a strategic partnership that will allow Snowflake’s users, which include Capital One, JetBlue, Sainsbury’s and Adobe, to access Salesforce data automatically on the platform.
Livestreaming platform developer Kuaishou has led a $434m series F round for China-based online question-and-answer service Zhihu. Internet groups Baidu and Tencent also contributed to the round along with private equity firm Capital Today. The transaction reportedly valued the company at almost $3.5bn. Founded in 2011, Zhihu runs an online platform where users can source answers to questions from an online community made up of 220 million registered users. The company also hosts forums, an online publishing service and livestreamed Q&A sessions from verified experts and business partners. It sells online education products but still generates most of its revenue from advertising. The series F proceeds will help Zhihu expand its online ecosystem with help from Baidu and Kuaishou, while it continues to develop its technology. It has now raised more than $890m.
US-based data analytics software producer Databricks completed a $400m series F round, which included Microsoft, a returning corporate investor. The round reportedly valued it at $6.2bn and was led by VC firm Andreessen Horowitz. It also featured venture firms Alkeon Capital Management, Coatue Management, Dragoneer Investment Group, Geodesic Capital, Green Bay Ventures, New Enterprise Associates (NEA) and Tiger Global Management, among others.
The new funding will permit the company to scale R&D activities and accelerate its international expansion. Databricks intends to invest €100m ($111m) into its Netherlands-based European Development Center. Founded in 2013, Databricks has developed a big data analytics platform based on Apache Spark which enables corporate clients to connect their data science and engineering teams so they can prepare data more thoroughly for analytics and processing on a large scale. The company boasts more than 2,000 corporate customers and claims its annual recurring revenue is higher than $100m. It released a version of the product customised for Microsoft’s Azure cloud computing platform in late 2017 in collaboration with the corporate.
Netskope, a US-based cloud cybersecurity software provider backed by computing technology producer Dell, completed a $340m funding round led by VC firm Sequoia Capital’s Global Equities unit. It also featured Sapphire Ventures, the venture firm spun off from software producer SAP. Canada Pension Plan Investment Board, Iconiq Capital, PSP Investments, Lightspeed Venture Partners, Accel, Base Partners, Geodesic Capital and Social Capital also contributed to the round, which the company said valued it at almost $3bn. Founded in 2012, Netskope has built a platform called Netskope Security Cloud that offers visibility of, and protection from, security threats across cloud services, apps and websites in real time. The round comes after a year when the company opened a new head office and satellite offices across the US, France, Brazil and Japan while entering new markets including Brazil, Australia, Italy, Spain, Germany, Singapore and Mexico.
Tencent co-led a $300m series E round for China-based big data software provider MiningLamp. The round was co-led by Singaporean government-owned investment firm Temasek and also featured video streaming app developer Kuaishou and undisclosed additional investors. MiningLamp produces big data mining technology that sources large volumes of raw data and uses artificial intelligence to produce information from it that can be used by customers in government and a range of private sector industries. The company will put the funding into growing its business in addition to R&D and increasing headcount. It also intends to create a smart marketing platform.
Salesforce led a $290m series B round for US-based robotic process automation (RPA) technology producer Automation Anywhere through its Salesforce Ventures subsidiary. The round valued Automation Anywhere at $6.8bn and also featured SoftBank Investment Advisers, the division of SoftBank that manages its $98.6bn Vision Fund and investment banking firm Goldman Sachs. Founded in 2013, Automation Anywhere has created an intelligent automation platform that enables organisations to automate some repetitive or manual processes using software bots. The product combines RPA with analytics tools, and AI and ML technology. The company has also built a version tailored for Salesforce users called Automation Anywhere Salesforce Connector.
Online insurer ZhongAn Online put in $145m and property manager Sinolink Worldwide invested $139m. The round raised RMB1.9bn ($285m) and means ZhongAn Online will continue to hold a 51% stake in the business, with Sinolink retaining the other 49%. ZhongAn Technology was launched in 2017 to focus on the development of blockchain, AI, big data and cloud computing technology in the financial services space. In addition to bolstering development, the new capital will be used to fund investments and strengthen cooperation with international partners.
China-based internet-of-things (IoT) technology developer Terminus Technologies raised RMB2bn ($283m) in a series C1 round, which featured three corporate investors, including e-commerce firm JD.com, property-focused conglomerate Wanda Group and voice recognition technology producer iFlytek. The round was led by asset manager China Everbright and backed by undisclosed additional investors. Founded in 2015 and incubated by China Everbright, Terminus Technologies develops AI-enabled industrial IoT products which can be used in public safety and urban management. The company targets governmental and private business customers.
GitLab, a US-based software development platform backed by Alphabet, closed a $268m series E round co-led by investment bank Goldman Sachs and multi-family office Iconiq Capital. Y Combinator took part in the round through its Continuity Fund and was joined by Adage Capital Management, Alkeon Capital, Altimeter Capital, Coatue Management, D1 Capital Partners, Franklin Templeton, Light Street Capital, Tiger Global Management and Two Sigma Ventures. Founded in 2014, GitLab provides a development and operations platform that supports the entire lifecycle of software development from creating, verifying, packaging and releasing to monitoring and configuring code. The platform is used by more than 100,000 clients, and GitLab plans to use the series E capital to further develop the product and to drive recruitment across its product, marketing, sales and administrative teams.
Exits
Corporate venturers from the IT sector completed 91 exits between June 2019 and May 2020 – 72 acquisitions, 14 initial public offerings (IPOs), four mergers and one stake sale.
Accounting and tax preparation software provider Intuit agreed to purchase US-based credit management platform developer Credit Karma for $7.1bn in cash and stock, giving Alphabet an exit. The conglomerate first backed Credit Karma via its CapitalG venturing subsidiary in an $85m series C round in 2014. The transaction involves almost $1bn in equity awards which will be issued in the next three years. The price of the acquisition nearly doubled the $4bn valuation, at which the Credit Karma raised its last round sized at $500m in 2018. The acquisition would be the largest in Intuit’s 37-year history.
Founded in 2007, Credit Karma has developed which allows its users to get free access to their credit scores once a week and online identity status in addition to filing their taxes and finding credit card and consumer loan deals. The platform has attracted 100 million users, 90 million of whom are from the United States. Its business model is based on referral fees it charges businesses for financial products and services it recommends to its users.
Online food delivery service Delivery Hero agreed to buy South Korea-based counterpart Woowa Brothers in a $4bn deal that will allow internet companies Naver and CyberAgent to exit. Woowa Brothers has built an app-based food ordering service that was responsible for 365 million orders in the year ending September 2019. It has more than 110,000 restaurant partners and made approximately $275m in revenue in 2018. Delivery Hero intends to expand its Korean activities through the acquisition and access areas where Woowa Brothers is active, such as cloud kitchens and adjacent on-demand services.
Alphabet agreed to pay $2.6bn to acquire Looker, a US-based data analytics technology provider backed by CapitalG, the corporate venturing unit formerly known as Google Capital. Looker has built a platform that can take business intelligence data from a range of sources and use a proprietary data modelling code language to unify it, allowing it to be used in other applications, analysed together more thoroughly and more easily shared. The company’s technology will be added to Google’s cloud computing services provider, Google Cloud, expanding the breadth of its business analytics capabilities and enabling users to quantify data from different sources using the same metrics.
Intel acquired one of its portfolio companies, Israel-based deep learning technology provider Habana Labs, for $2bn. Founded in 2016, Habana develops artificial intelligence processors that enhance the performance of models constructed to train AI systems. It launched its second processor, the scalable Gaudi system, in June this year. Navin Shenoy, general manager of Intel’s Data Platforms Group, said: “This acquisition advances our AI strategy, which is to provide customers with solutions to fit every performance need – from the intelligent edge to the data centre.” The company will continue to operate independently, but as a division of Intel. Its chairman, Avigdor Willenz, will retain an adviser position both at Habana and Intel in general.
Salesforce agreed to acquire one of its portfolio companies, US-based customer relationship management (CRM) software provider Vlocity, for $1.33bn in cash. The transaction will include the company assuming unvested equity awards held by the latter’s employees. The price was described as net of the value of shares currently owned by Salesforce. The acquisition is expected to close in 2021 and professional services firm Accenture and insurance provider New York Life will also exit. Founded in 2014, Vlocity has created a range of CRM apps that fit on top of the Salesforce platform but which are tailored for specific industries such as communications, media and entertainment, energy and utilities, healthcare and insurance, as well as government work.
Private equity firm Hellman & Friedman agreed to acquire a majority stake in Checkmarx, a US-based software security technology provider backed by Salesforce, at a $1.15bn valuation. Founded in 2006, Checkmarx has developed a platform that reduces and fixed vulnerabilities in software applications during development process. It can be deployed on premises, in the cloud or in hybrid environments and is used by more than 1,400 customers across 70 countries.
CapitalG, Alphabet’s growth equity arm, agreed to provide $100m as part of a $1.1bn acquisition of France-based cybersecurity software provider Armis by growth equity firm Insight Partners. Insight Partners will put up the majority of the cash for the transaction, with “rollover” from undisclosed existing investors. Armis produces security software for enterprises operating IoT or unmanaged devices, such as mobile devices, smart televisions or full-scale industrial or building systems. VC fund Iris Capital and assorted angel investors provided approximately $1.1m for Armis in 2017 before the company added $6.7m from VC firm Elaïa Partners and unnamed existing backers. The company subsequently raised $30m in an April 2018 series B round co-led by VC fund Red Dot Capital Partners and Bain Capital Ventures, the VC arm of private equity firm Bain Capital, and backed by VC firms Tenaya Capital and Sequoia Capital.
App delivery services provider F5 Networks agreed to acquire US-based anti-fraud technology developer Shape Security in a $1bn deal that will enable corporates Alphabet, Hewlett Packard Enterprise (HPE), JetBlue and SingTel to exit. Shape’s software uses artificial intelligence, machine learning and analytics helps to protect businesses from online attacks and fraud instituted through bots capable of bypassing conventional barriers.
Networking equipment manufacturer Cisco agreed to acquire ThousandEyes, a US-based network management software provider backed by Alphabet and Salesforce. The price was reported to be approximately $1bn. Founded in 2010, ThousandEyes provides cloud analytics software that collects data from a range of access points, such as data centres and consumer devices, to identify potential sources of disruption and ensure websites, applications and services are delivered optimally. Cisco will integrate the company’s technology into its new Networking Services division and expects the combined capabilities to help clients accelerate their digital transformation.
Biopharmaceutical company Alkermes agreed to acquire US-based neurological disease drug developer Rodin Therapeutics for up to $950m, enabling medical group Johnson & Johnson and Alphabet to exit. The transaction comprised $100m in cash upfront and up to $850m in milestone payments related to regulatory and clinical progress and pre-set sales levels. Rodin is developing treatments for neurodegenerative diseases like Alzheimer’s disease, Lewy body dementia, Huntington’s disease and frontotemporal dementia as well as sickle cell disease and cancer. The company’s small molecule therapeutics will rely on targeting selected protein complexes which can modulate gene expression. They are intended to complement Alkermes’ range of treatments for central nervous system diseases.
GCV also reported several exits of emerging IT-related enterprises that involved corporate investors from different sectors.
CrowdStrike, the US-based endpoint protection software provider backed by Alphabet, cloud services provider RackSpace and telecoms company Telstra, raised $612m when it went public. The company issued 18 million shares on the Nasdaq Global Select Market priced at $34 each, higher than the $28 to $33 range it had set. Those terms had been increased from $19 to $23. The IPO valued CrowdStrike at approximately $6.82bn. Founded in 2011, CrowdStrike has built an AI-equipped, cloud-based cybersecurity platform that detects and prevents cyber-attacks at the endpoint, on laptops and desktops as well as servers and connected devices. The company’s net loss increased slightly to $140m in the year running up to the end of January 2019, but it more than doubled revenue to almost $250m over the same time.
Banking software producer Temenos agreed to pay at least $559m to acquire Kony, a US-based mobile banking software developer backed by telecom firms SoftBank and Telstra. The deal consisted of $559m upfront and a $21m earn-out. Founded in 2008, Kony operates a cloud-based platform that allows enterprise clients to develop and deploy applications that enable customers to signing up for accounts, accessing loans and making payments quickly and efficiently at any time of day. The company’s offering includes Kony Quantum, an app development tool for financial services providers that requires minimal coding. Temenos bought Kony in a bid to bolster its scale and capabilities in the US and accelerate Temenos Infinity, a digital front-office product that is already used by more than 500 clients in the financial services sector.
Scout RFP, a US-based developer of a sourcing platform for businesses, agreed to a $540m acquisition by one of its existing investors, enterprise software producer Workday. The all-cash transaction will allow Salesforce Ventures and GV, the corporate venturing divisions for Salesforce and Alphabet, to exit. The deal is expected to close by the end of January 2020, subject to customary closing conditions. Founded in 2014, Scout runs a cloud-based platform for procurement staff to manage sourcing and supplier engagement, collaborate with relevant parties and handle a pipeline of projects. Employees will join Workday, which expects the platform to complement its Workday Procurement and Workday Inventory.
Funds
For the period between June 2020 and May 2020, corporate venturers and investing in the IT sector secured over $12bn in capital via 37 funding initiatives, which included 28 VC funds, four new CVC subsidiaries, two accelerators and one other initiative.
On a calendar year-to-year basis, the number of funding initiatives in the IT sector went up slightly from 69 in 2018 to 72 last year, though significantly down from the peak of 148 2016. The total estimated capital also increased – it stood at $16 bn by the end of last year, from the $9.78bn in 2018. This substantial increase in the totals, however, is a bit of an illusion because of an outlier-sized fund in 2019 (the $8.5bn TA XIII fund which has tech among its sectors).
China-based internet and gaming group Beijing Kunlun Technology established a RMB3bn ($424m) VC fund with investment manager Beijing Huayu Tianhong. The two are the cornerstone investors for Kunlun (Beijing) Internet Intelligent Industry Investment Fund and will each provide RMB1bn. A Kunlun subsidiary known as Xinyu Shijie Wuji Investment Management is chipping in RMB10m and will be general partner. Founded in 2008, Kunlun specialises in mobile and web browser-based games but its subsidiaries include Opera, the mobile browser it acquired in 2016. The company bought gay hook-up app Grindr the same year and agreed a $608m deal to sell it earlier, representing a four times return. The fund is targeting developers of internet and artificial intelligence technology but Kunlun has not disclosed more details.
DTCP, the investment arm of Germany-based telecoms firm Deutsche Telekom formerly known as Deutsche Telekom Capital Partners, secured external investors for its $350m fund. The corporate launched the first fund in 2014 as a successor to T-Venture, which had been its corporate venture capital (CVC) arm since 1998. The parent company supplied $140m at the time, meaning the total it provided across various funds was $620m. South Korea-based telecoms firm SK Telecom and optical systems producer Zeiss are limited partners in the new fund, as are private equity firm HarbourVest Partners and investment manager Neuberger Berman. The new fund will invest at growth stage, providing $5m to $50m in funding to enterprise software developers operating in areas like 5G technology, the internet of things, cloud and network infrastructure, artificial intelligence, cybersecurity and marketing. It will also back other funds.
Singapore-based VC firm Vertex Ventures closed its Vertex Growth Fund at $290m with backing from LPs including computer touchpad manufacturer Elan Microelectronics. The fund surpassed its original $250m target and was also backed by Vertex’s state-owned parent firm, Temasek, as well as unnamed institutional investors, family offices and funds from Southeast Asia and Taiwan.
Founded in 2015, Vertex now has a total of six independently-run VC funds spanning Southeast Asia, China, India the US and Israel. It has about $3bn in assets under management and has invested in more than 200 companies. Vertex Growth Fund invests $10m to $15m per company and largely takes part in a company’s third or fourth funding round, though it has the mandate to provide $3m to $4m in earlier-stage deals through affiliate vehicles, according to Vertex Venture Holdings chief executive Chua Kee Lock. The vehicle has a global remit but is focused on high-growth areas in specific markets, such as cybersecurity in Israel or consumer-related technologies in China and Southeast Asia.
UK-based investment firm Ahren Innovation Capital closed its inaugural vehicle at more than £200m ($253m) from LPs including consumer goods conglomerate Unilever, insurance firm Aviva and broadcaster Sky. The LP list also featured diversified holding group Wittington Investments, undisclosed US families, and individual investors including André Desmarais, Carlos Rodriguez-Pastor and the eight scientists who co-founded the vehicle. The fund had reached a $129m first close in September 2018.
Founded in 2017, Ahren Innovation Capital focuses on technologies covering the human brain and artificial intelligence, genetics and biotechnology, space and robotics, and energy and environmental technologies. The firm both invests in and helps build companies, offering access to the expertise of its founding science partners. It is in particular seeking out opportunities that take a multidisciplinary approach to tackle challenges.
A host of corporate LPs have contributed to two funds launched by Germany-based VC firm E.ventures that totalled $400m. The vehicles in question were a $225m fund that invests in the US out of an office in San Francisco, and a $175m Europe-oriented fund based in Berlin. Existing backers including mail-order retailer Otto Group, supermarket chain Lidl, packaged food producer Dr Oetker and automotive manufacturer Porsche were joined by new LPs like brewery owner Bitburger, cleaning device provider Kärcher and shoe retailer Deichmann. Founded in 1999, E.ventures invests in financial and software-as-a-service technology developers, using proprietary technology to assess possible targets as well as consumer. It maintains offices in Europe and the US and has partners located in China, Japan and Brazil. The new funds will both look to provide between $1.5m and $10m for each deal in which they participate, seeking out companies from pre-series A to series B stage. E.ventures now has a total of $1.6bn under management.
Singapore-based VC firm Jungle Ventures closed its latest fund at $240m, securing the capital from limited partners including Cisco Investments, a subsidiary of Cisco Systems. Bualuang Ventures, the CVC arm of Bangkok Bank, is also an LP, as are Temasek, the World Bank’s International Finance Corporation, development finance institutions DEG and FMO, and Kuok Khoon Hong, chief executive of agribusiness Wilmar International. Jungle Ventures III is the firm’s third Southeast Asian fund, and the close includes $40m from separately managed account commitments. It will focus on digital consumer brands, enterprise software and local developers of technology that can be scaled worldwide.
DG Daiwa Ventures, the VC fund formed by internet company Digital Garage and investment bank Daiwa Securities, launched a ¥20bn ($188m) investment fund. DG Lab Fund II will target companies across the world that are developing next-generation technologies and will work with DG Lab, the fund’s open innovation research and development unit, on selecting portfolio companies. The fund’s main areas of interest are blockchain, artificial intelligence, virtual and augmented reality, security and health-based biotechnology. The capital allocation is expected to last 10 years. Digital Garage and Daiwa are the general partners while 10 to 20 limited partners, including telecommunications firm KDDI, e-commerce company Kakaku, insurer Sompo Japan Nipponkoa and financial services firm Sumitomo Mitsui Trust, will contribute approximately $4.7m to $19m each.
Investment manager Reliance Nippon Life Asset Management (RNAM) will manage a $187m fund of funds backed by several Japan and India-based corporates. The LPs for the vehicle, Indo-Japan Emerging Technology & Innovation, include insurance firm Nippon Life, automotive manufacturer Suzuki, financial services firm Mizuho Bank and state-owned financial institution Development Bank of Japan. RNAM is promoted by Japan-based Nippon Life and Reliance Capital, the financial services arm of India-headquartered conglomerate Reliance Group. It holds 85.8% of the fund’s share capital. Indo-Japan Emerging Technology & Innovation is intended to invest in 15 to 25 India-focused VC funds, with the resulting capital eventually boosting sectors such as the internet-of-things, artificial intelligence, business-to-business software and robotics technology.
US-based financial technology provider FIS announced a $150m commitment to CVC subsidiary FIS Ventures. The $150m represents a target level for the unit’s investment over the next three years, and its priority areas include distributed ledger technology, financial inclusion, artificial intelligence and machine learning, data and analytics, security, privacy, digital enablement and automation. The announcement marked the official launch of FIS Ventures, though the company revealed in January 2020 that the unit would be overseeing the fifth iteration of its FIS Fintech Accelerator. FIS Ventures’ first deal was in the $35m series B round closed by Africa-focused payment technology provider Flutterwave. The unit also participated in a $6m series A for distributed ledger technology developer Billon Group.
University backing
By the end of 2019, there were 114 rounds raised by university spinouts, down 16% from 135 the previous year. The level of estimated total capital deployed in 2019 stood at $2.19bn, up 61% from the $1.36bn in 2018.
Most notably in 2019, there was a mega-acquisition of a company that traces its origins to academia. Tableau, a US-based data visualisation and analytics spinout of Stanford University, agreed to an acquisition by enterprise software producer Salesforce for $15.7bn. Tableau had a $10.79bn market cap when the deal was signed. Trading of the stock had been halted in light of the acquisition news. Founded in 2003, Tableau Software has developed data visualisation technology capable of extracting data from a wide range of sources, including relational databases, spreadsheets and cloud databases, in order to generate graphs. The company’s underlying technology, VizQL, was developed at Stanford University’s Department of Computer Science between 1999 and 2002 by Pat Hanrahan with Chris Stolte and Christian Chabot.
China-based facial recognition technology developer CloudWalk obtained RMB1.8bn ($254m) in a funding round backed by Haier Financial Holdings, a unit of home appliances manufacturer Haier. A range of national and municipal government-owned entities also contributed, including investment company Guosheng Group, financial services firms Nansha Financial Holding and Industrial and Commercial Bank of China, as well as the China Internet Investment Fund. Spun out of Chinese Academy of Sciences in 2015, CloudWalk produces facial recognition software and hardware that is used by police departments in more than 30 provinces across China as well as financial services, aviation and security companies nationally.
SambaNova Systems, a US-based artificial intelligence system developer co-founded by Stanford University faculty, received $250m in series C funding led by funds and accounts managed by investment firm BlackRock. Intel Capital and GV, respective subsidiaries of Intel and Alphabet, also took part in the round, as did VC firms Walden International, WRVI Capital and Redline Capital. SambaNova was formed to bring cutting-edge AI technology to products that can be used by a wider range of organisations. Its lead product is an optimisable platform that combines hardware and software to run compute and data-intensive applications across a range of systems. The company’s co-founders include Stanford University professors Kunle Olukotun, and Christopher Ré.
People
Keith Larson, vice-president and managing director of Intel Capital, retired in April. Larson, who had spent nearly 23 years at the unit, was one of five voting executives on the investment committee responsible for approving all its investments. Larson cited a focus on sustainability along with its parent’s size and strength as the reasons Intel Capital was able to create a long-term strategy. That approach has helped Intel nearly quadruple its annual revenue from about $20bn in 1996 to $70.8bn in 2018.
Lee Sessions, former managing director for global corporate venture relationships at Intel Capital, joined Global GCV as its first executive-in-residence. The position will involve advancing corporate venturing and innovation (CV&I) industry growth and success. Sessions was a founding member of the GCV Leadership Society Advisory Board in 2016 to bring together influential corporate venture investors to address innovation and investment challenges in meaningful ways and mentor the next generation of leaders. Sessions had spent more than a decade being responsible for portfolio business development, marketing, press relations, events and information services operations for Intel Capital.
Microsoft appointed Brandon Middaugh to manage the $1bn Climate Innovation Fund it had announced. Microsoft pledged $1bn for the vehicle as part of a wider goal to achieve carbon neutrality by 2030, and to remove the equivalent of the excess carbon it has emitted since its launch by 2050. The fund will invest in developers of carbon reduction and removal technology, though the corporate – which already owns VC unit M12 – has not revealed details of a timeframe nor the range of its portfolio. Middaugh will manage the fund and investment strategy, having spent four years at Microsoft as a senior program manager, leading its distributed energy strategy as part of the company’s energy and sustainability activities.
Ram Jambunathan was promoted to head of corporate strategy at Germany-based software provider SAP. The promotion allowed him to retain his role as managing director for corporate venturing unit SAP.iO, responsible for investing in and accelerating early-stage external startup innovation.
Shinji Asada moved on from his position as head of Salesforce Ventures Japan, a CVCsubsidiary of Salesforce, to co-found venture firm One Capital. Recipient of a GCV Emerging Leaders award in 2020, Asada’s role at Salesforce involved sourcing new deals, conducting due diligence and providing thought leadership in portfolio companies’ board meetings. Asada began his career at trading group Itochu where he spent more than a decade in different roles from new business development and mergers and acquisitions to system integration and software-as-a-service sales, before joining CVC unit Itochu Technology Ventures in 2012.
İskender Dirik, the chief executive of Microsoft’s continental Europe scaleup accelerator, joined Samsung’s corporate venturing unit, Samsung Next, as managing director. Still based in Berlin, Dirik said he would help to define its focus areas for Europe. Dirik had previously been MD for Bauer Venture Partners, the €100m ($110m) CVCl fund for Bauer Media, a media company focusing on magazine publishing and radio broadcasting. At Samsung Next, Dirik will join Europe-based colleagues including Nick Migam in Berlin and Mario Branciforti and Christina Bechhold Russ in London.
Barrett Parkman joined Samsung’s US-based Catalyst Fund as director of its startup and VC ecosystem. Catalyst is Samsung Electronics’ $500m evergreen multi-stage CVC fund investing globally in the data economy and core technologies in new Samsung business areas. The company has other corporate venturing units, including Samsung Next and Samsung Venture investment Company. Parkman had been a partner at GWC Innovator Fund, an early-stage VC fund that primarily invests in AI and data-centric startups in the US, China, Israel, and India and where he led 19 of its 31 investments, including Tapzo (acquired by Amazon) and FriendlyData (acquired by Service Now).
Matthew Olton left his role as senior vice-president of corporate development for US-based cybersecurity technology supplier Symantec. He has been appointed senior vice-president of strategy and corporate development at Tenable, and his responsibilities will include addressing security technology issues to help customers manage cybersecurity risk. Symantec hired Olton in April 2018 and he conducted mergers and acquisitions and corporate venturing deals during his time at the company.
Rob Salvagno left his position as head of networking equipment manufacturer Cisco’s corporate venturing subsidiary, Cisco Investments, to join private equity firm KKR. Salvagno had worked for Cisco for over two decades from late 1999, managing VC and mergers and acquisitions deals on its behalf, and held the role of head of corporate development alongside his leadership of Cisco Investments. The post involved overseeing the launch of Cisco-sponsored VC firm Decibel in April 2019 and the acquisition of cybersecurity technology producer Sentryo two months later. Other key deals during Salvagno’s time included the purchases of AppDynamics for $3.7bn in 2017 and Duo Security for $2.3bn the following year.
Cathy Gao left Axa Venture Partners, a corporate venturing vehicle for insurance and financial services group Axa, to become a vice-president at Sapphire Ventures, the VC firm backed by software producer SAP. Gao will focus on the enterprise software, security and vertical software segments. She had been an investor at Axa Venture Partners since January 2017, covering deal spaces such as enterprise software, internet, digital health and financial technology. Before joining Axa, Gao worked in business operations and strategy for financial services firm Gusto between for roughly 18 months to the end of 2016. Gao began her career in 2010 as a merger and acquisition analyst for private equity firm Blackstone Group, before leaving in 2012 to join the team at growth equity firm TA Associates.
Weeks after leaving Alphabet’s GV unit, Vineeta Agarwala became one of the investors overseeing a $750m fund for US-based VC firm Andreessen Horowitz. Agarwala’s departure was officially announced after more than four years in GV’s life sciences team overseeing life sciences-related investments in areas such as genomic data and health technology. Andreessen Horowitz revealed Bio Fund III in a blog post co-authored by Agarwala and fellow general partners Jorge Conde, Vijay Pande and Julie Yoo. It will focus on the intersection of software and healthcare and follows the $200m Bio Fund in 2015 and its $450m successor in 2017.
Ken Asada, managing director at NTT Docomo Ventures, the corporate venturing unit owned by Japan-based mobile network operator NTT Docomo, left the company ahead of his move to Salesforce Ventures. Asada had spent less than a year at NDV, having joined in January from Intel Capital, the investment arm of semiconductor producer Intel. Asada had been promoted to investment director during a stint of nearly eight years at Intel Capital. He told GCV in January 2019 that during his time at Intel Capital he participated in deals totalling more than $200m and sat on the boards of portfolio companies Cloudian – also part of NTT Docomo Ventures’ portfolio – LeapMind, Gengo and Fileforce.
Rashmi Gopinath left her managing director role at M12, Microsoft’s corporate venturing arm, and joined VC firm B Capital Group as a general partner. Gopinath began her corporate venturing career at Intel Capital, chipmaker Intel’s investment vehicle. She spent two years there from 2011 focusing on cloud infrastructure, cybersecurity and enterprise software deals. The nascent M12 (then known as Microsoft Ventures) brought Gopinath on board in 2016 and she was tasked with investing in companies in similar domains, such as cloud-based data platforms CloudLanes, Frame and Paxata, all of which were later acquired. Global Corporate Venturing ranked Gopinath sixth in 2017’s Rising Stars list before she was promoted to managing director at M12. She partnered unit head Nagraj Kashyap in early 2019 to back India-based startups including healthcare data platform Innovaccer.
SoftBank Investment Advisers (SBIA), which manages Japan-headquartered SoftBank’s Vision Fund, hired Vikas Agnihotri as an India-based operating partner. Agnihotri joined Google in 2011 as an India-based director before being promoted to managing director of sales at Google India seven years later. He was made interim head of Google India in April 2019. SBIA manages Vision Fund, which closed its first fund at $98.6bn and which is currently raising its second vehicle. Vision Fund appointed Sumer Juneja as an India-based partner in late 2018 and its local portfolio companies include Delhivery, FirstCry, Grofers, Lenskart, Ola, Oyo, Paytm and PolicyBazaar.
Intel hired Lisa Coca as a managing director and entrepreneur in residence. Coca came from industrial and power technology conglomerate GE, where she had held a variety of managerial roles for nearly two decades at its GE Capital Real Estate division and GE Ventures, the company’s corporate venturing arm. Coca had most recently been a managing director of enterprise software at GE Ventures for seven years from 2012, investing in enterprise technology developers on behalf of the unit, her deals including rounds for Catalant Technologies, Octiv and Zinc. In addition, Coca headed GE Ventures’ Edge initiative, which helped portfolio companies access GE’s network, know-how and resources to build and grow their projects.
Vin (Praveen) Lingathoti, former regional head of venture investments at Cisco in the UK and California since 2015, joined university-focused Cambridge Innovation Capital (CIC) as a partner specialising in software investments. At CIC, which has raised £275m ($300m) since 2013, Lingathoti will make early-stage investments in enterprise and deep-tech companies affiliated with the University of Cambridge and the local ecosystem. At Cisco, his fund commitments included Idinvest, Partech Ventures and Evolution Equity Partners, while his board observer roles included Sweden-based BehavioSec, UK-based companies Panaseer and Adbrain, Spain-based Worldsensing and France-based Intersec Group. Before joining Cisco, Lingathoti had been an investment director at SK Telecom Innopartners, a fund providing up to $1m in seed capital for disruptive startups in enterprise technologies.
Pratima Aiyagari left Cisco Investments and taken up a UK-based investment director role at VC firm Paladin Capital Group. Cisco recruited Aiyagari in 2011, hiring her as a UK-based domain lead for Europe for its corporate development division, where she oversaw venture investments and mergers and acquisitions transactions. Aiyagari focused on artificial intelligence, machine learning and enterprise collaboration deals for Cisco Investments, taking board observer positions at companies including AImotive, BehavioSec and Evrythng. The move came after former unit head Rob Salvagno’s departure. He was succeeded by Derek Idemoto, senior vice-president of corporate development and head of Cisco Investments, Cisco confirmed to GCV.
Jason Ball has moved from a UK-based managing director role at Qualcomm’s corporate venturing unit, Qualcomm Ventures, to become a partner at consumer-focused VC firm GR Capital. Ball spent more than 11 years at Qualcomm Ventures, focusing on augmented and virtual reality, mobility, artificial intelligence and internet-of-things investments. Deals led by Ball include rounds for video advertising management platform Videoplaza, online radio service We7 and network-on-chip technology provider Arteris, all of which were later acquired. GR Capital is a late-stage investor with a portfolio that includes Deliveroo, Glovo, Lime and Wefox. Ball joined the firm at the same time as Gopinath Selveswaran, previously director of investor relations at VC firm Balderton Capital, as it expands from its Ukrainian venture roots.
Julia Ognieva, founder of social network operator Facebook’s first in-house startup initiative, joined financial services platform Intuit to manage external partnerships for its Quickbooks application. The move comes after Ognieva spent more than five years as a strategic product partnerships, platform and augmented reality executive for Facebook, setting up LDN_LAB in November 2018 as an in-house startup program at the company’s UK office.
Decibel, the US-based VC firm backed by Cisco, hired Richard Sherman as an adviser. Sherman was a founding contributor to digital media platform The Players’ Tribune and an investor and adviser for sports drink supplier BA Sports Nutrition, but is best known for his career as a Super Bowl-winning cornerback for American football franchise the San Francisco 49ers. Cisco launched Decibel in April 2019 and it focuses on North America-based enterprise technology developers, investing at seed to series A stage. It is headed by founding partner Jon Sakoda, previously a partner at VC firm New Enterprise Associates. Decibel has tasked Sherman with advising its portfolio companies, leveraging his professional athletic leadership to help them build their teams.
Steven Vanada left Japan-based internet company CyberAgent’s corporate venturing subsidiary, CyberAgent Capital (CAC), to join Indonesia-based investment firm Kinesys Group. Vanada co-founded the Indonesian office of CAC, then known as CyberAgent Ventures, as part of a two-year stint as an investment manager from 2011, before being promoted to vice-president. He was appointed executive director in 2016 to focus on business-to-business, e-commerce and financial technology developers. Vanada’s investments included online payment platform operator Coda Payments and consumer and industrial products marketplace Ralali, and he took board seats at portfolio companies such as news aggregation app developer Kurio and e-commerce marketplace Tokopedia.
GV hired Sridhar Ramaswamy as an entrepreneur-in-residence to explore the oncology ecosystem. Ramaswamy moved from US-based cancer treatment developer Tesaro, where he had been senior vice-president and head of research and early development since 2017. Ramaswamy was an oncologist dedicated to breast cancer, gastrointestinal cancer and leukaemia care for nearly two decades at Massachusetts General Hospital. He will leverage his medical background to identify biotechnology, healthcare and life sciences investment opportunities.
Salesforce Ventures hired Takuya Hosomura as a Japan-based principal. Hosomura was previously at e-commerce firm Rakuten where he had spent nearly six years. The company hired him for its marketing division in 2014 and he joined investment subsidiary Rakuten Capital two years later. His senior manager role at Rakuten Capital from 2017 involved Hosomura investing in startups and building strategic partnerships between portfolio companies and the unit’s parent. It backed companies including Glovo, PremFina, Maxi Mobility and Simplesurance during his time. Hosomura also supported seed-stage startups through Rakuten’s Singapore-based accelerator scheme, Rakuten Accelerator, Powered by Techstars, which was formed in 2017. One of its graduates, customer data management platform Shoffr, was acquired by peer Affle in March 2019, enabling Rakuten
to exit.
Priyanka Mitra joined M12, the CVC subsidiary of Microsoft, following turnover in its team. Mitra had previously been at VC firm Tola Capital since November 2018 after nearly two years working in corporate venturing as an associate at Kaiser Permanente, the largest integrated healthcare provider in the US. The move followed the departures from M12 of Rashmi Gopinath and Ronan Kennedy to BCG-backed VC firm B Capital Group, in addition to that of managing director Lisa Nelson, a founding member of its team.
Sector specialists: Francis Ho & Shankar Chandran
Francis Ho and Shankar Chandran are senior vice-presidents, managing directors and co-heads of Samsung Catalyst Fund (SCF), a $500m evergreen corporate venturing for electronics manufacturer Samsung.
SCF backs new data economy and strategic areas on behalf of Samsung’s mobile, device and consumer electronics divisions. The technologies in question include artificial intelligence (AI), automated mobility, digital health, security and cloud infrastructure.
SCF’s recent investments included digital insurance provider Wefox Group in December last year, quantum computing technology developer IonQ two months before, as well as smart driving technology developer Commsignia in August 2019.
In addition, SCF exited AI processor developer Habana Labs, whose acquisition by chipmaker Intel was announced in December 2019 for approximately $2bn.
Ho’s experience in venture capital, business development, strategy consulting, marketing and engineering is combined with his broad operating knowledge in various sectors including semiconductors, optics, networking and storage.
Ho earned a PhD in physics from Stanford University, where he was a National Science Foundation Graduate Research fellow, and holds seven US patents relating to semiconductor technologies.
Chandran had been a technology investor for 15 years before Samsung. He began his VC journey as a founding partner at venture firm Panorama Capital, having also held multiple engineering, business development and management roles at semiconductor manufacturing technology provider Applied Materials and received eight patents as the primary inventor.
Chandran holds an MBA from University of Pennsylvania’s Wharton School and a master of science in materials science from Arizona State University.
Sector specialist: Quinn Li
Quinn Li has been overseeing Qualcomm Ventures, US-listed chipmaker Qualcomm’s corporate venturing arm, since 2016.
In November 2018, he was promoted from vice-president to senior VP for the corporate.
Li has cemented his reputation as a leader in the venture community with a string of deals and initiatives. The unit made two China-based investments in 2020, backing healthy food supplier and lifestyle service Boohee and electronic display technology provider Yunyinggu. It also added US-based artificial intelligence robotics technology developer Brain Corp and medical assessment technology developer Tyto Care to its portfolio.
Qualcomm Ventures also scored multiple exits in the past year, most recently software provider Microsoft announced in March 2020 its intention to purchase mobile network technology provider Affirmed Networks
for $1.35bn.
In addition, Qualcomm exited radio frequency (RF) technology provider Cavendish Kinetics in an acquisition of undisclosed size by RF equipment producer Qorvo in October 2019, which came after cloud services provider Cloudflare went public the month before in a $525m initial public offering.
Li joined Qualcomm Ventures in 2005 after roles at IBM, Broadcom and Lucent following completion of his electrical engineering PhD at Washington University in St Louis. He said some of the biggest challenges he has had to overcome along the way have involved finding the balance between strategic and financial objectives while building the right team with sufficiently diverse experience to expand investments into new areas.
Sector specialist: Nagraj Kashyap
Nagraj Kashyap, corporate vice-president of software producer Microsoft, leads its investment unit, M12, as global head.
M12 has already backed more than 80 startups in North America, Israel, Europe, Australia and India, including customer service software provider Directly, on-demand workplace training provider GO1.com, artificial intelligence-equipped consultancy service provider FortressIQ and Onfido, a facial biometrics software developer.
In addition, M12 invested in FarEye, the operator of a predictive logistics software platform, online fraud prevention technology provider Arkose Labs and digital wallet developer Bakkt.
Kashyap has been involved in VC, software engineering, business development and management for more than two decades, and is an active mentor and thought-leader in the ecosystem.
Before joining M12, Kashyap had been at semiconductor technology producer Qualcomm from 1989 to 2014. He joined Qualcomm’s corporate venturing arm, Qualcomm Ventures, in 2003, where he oversaw the North America ventures team until 2007 when he was appointed senior vice-president and head of global venturing.
Kashyap began his career as a software engineer at Nortel, Motorola and 3Com/US Robotics before moving to management consulting firm PRTM, now part of PricewaterhouseCoopers.
Kashyap earned an MBA from the Northwestern University’s JL Kellogg Graduate School of Management, a master of science in computer science from University of Texas at Austin and a bachelor of engineering in computer science from University of Mysore.