Europe/Israel Enterprise/Tech Weekly

The Angle Issue #42: November 13, 2018

Good morning from London Heathrow where I'm on my way to Tel Aviv for a few days.

The big news this week was undoubtedly SAP's massive $8B acquisition of Qualtrics, a Utah-based SaaS company that provides "experience management software" for collecting and analyzing data for market research, customer satisfaction and loyalty, product and concept testing, employee evaluations and website feedback. 

As Tomasz Tunguz pointed out, this is the largest ever VC-based software acquisition ever and, at 23x trailing twelve months' revenue, the second most richly valued ever (second only to Github). The category is an intriguing one, and Qualtrics is an impressive success story. That said, the valuation and the size of the acquisition have quite a few analysts scratching their heads. CIO Dive, however, seems to buy the rationale: "The [Qualtrics] software helps companies measure how they can offer and improve customer experience, an invaluable tool for companies that exist in physical locations and online. A company's ability to harness data and drive meaningful insight from analytics can push them ahead of the competition. Every company benefits from knowing more about their customers and their needs. And SAP wants to be the company that offers the tool to help with that."

Bryce Roberts of the VC firm OATV provided a great analysis of how Qualtrics shifted the narrative around their category in 2017: "Until 2017 Qualtrics was a survey company. They built software that helped professors, initially, then companies, to survey customers, students, anyone on any topic. Then, they shifted their narrative. You stopped hearing them talk about surveys and started hearing them talk about experiences. And you stopped hearing them talk about competitors because they didn’t have any competitors in the “Experience Management” space. Because there was no Experience Management space! It’s was just them. They created an entirely new category that they got to define and dominate vs. going feature for feature with countless other survey software vendors."

(graphic from Tomasz Tunguz's post.)

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If you are building an enterprise tech startup in Europe or Israel, please let me know... 

From the blog

Accelerators or Conform-erators? You know what I find interesting? As a VC or investor, you go and meet companies coming out of an accelerator, and you notice, on reflection, that all the teams look vaguely the same...

Angular's first investment: Why we invested in Aquant.io

1Q18 & 2Q18 EU+IL VC Data.
$12.7B of VC investment summarized in 70 slides. 

Europe/Israel Enterprise/Tech

• Israel/Semiconductors. Valens raised $63M for the delivery of uncompressed HD video multimedia. The company develops a chip for transmitting HD video, audio, control, and power on a single CAT5 cable. In recent years, the company has pivoted towards the automotive use case. 

• Israel/ITSM. Samanage raised $30M for its enterprise service-desk and IT asset-management SaaS package. 

• Netherlands/Design tools. Interactive design platform Framer raised $24M. 

• Israel/Agtech. Taranis raised $30M for its aerial crop management technology. 

• Denmark/Templates. Templafy raised $15M for its template management platform.

• UK/Payments. Paddle raised $8M for its payments platform for SaaS software.

• Israel/Netherlands/Security. Israeli Nasdaq-listed security company ForeScout Technologies acquired Dutch operational technology network protection company SecurityMatters B.V. for approximately $113 million in cash.

• UK/Israel/Semiconductors. London-listed Vitec Group PLC has acquired Israel-based chipmaker Amimon for $55M.

• UK/Israel/Europe. A new framework for the European Union's 100 billion euros research and innovation program could see grants cut to non-member countries, among them the U.K, Switzerland, and Israel.

• Israel/Security. Symantec acquired Israel-based Javelin Networks. Terms were not disclosed. 

Worth reading

Enterprise/Tech News

• Healthcare IT. Atul Gawande of the New Yorker on "Why Doctors Hate Their Computers. "Something’s gone terribly wrong. Doctors are among the most technology-avid people in society; computerization has simplified tasks in many industries. Yet somehow we’ve reached a point where people in the medical profession actively, viscerally, volubly hate their computers."

• What does the future of work mean? Jessica Lin from Workbench explains. 

• Capex boom. The Information covers the boom in technology capex.

• Voice. Recode argues that voice-based technologies had been adopted faster than nearly any other technology in history. 

• The endless allure of dystopian hellscapes. The New York Times explores why Silicon Valley is "in love with [its] principal doomsayer," Israeli-born Oxford-trained futurist Yuval Noah Harari. 

• From blockchain to DLT. Forrester predicted that the term "blockchain" will fall out of favor as enterprises turn to more inclusive and neutral DLT terminology. Meanwhile, Axios argues that corporate America's love affair with DLT is over.

• Food tech. How Tyson's emerging tech team is cultivating innovation in food tech.

How to Startup

• Hiring data scientists. James co-founder Pedro Fonseca on how to hire Data Scientists in five steps.

• A taxonomy of "no." My friend Avi Eyal of Entree Capital characterizes five levels of "no" from VCs and what they might actually mean. 

• The four phases of a partner/co-founder relationship. My friend Carlos Espinal of Seedcamp outlines the "four plus one" phases of the co-founder journey. 

How to Venture

• "Founders: Please don't allow anyone to screw your early backers." My friend, the incredible Christoph Janz of Point Nine, writes about the mechanics of founder re-ups in startups, and makes an impassioned plea to avoid them. "The prospect of keeping a larger stake can understandably be tempting for founders, and once the pandora box has been opened by a new investor, it can be hard to shut it. What makes the situation particularly uncomfortable is that if as a seed investor you object the founder re-up, you suddenly look like the bad guy who doesn’t want to grant the founders some additional shares for all their hard work and who risks the entire deal by bringing up your concerns, while the later-stage investor looks like the good guy who wants to reward the founders. As we’ve seen in the example above, this interpretation is absurd because the later-stage investor proposes a reward that benefits him/her and is borne by someone else, but in the hectic and pressure of term sheet negotiations, this can be forgotten. Therefore it’s all the more important that founders fully understand the implications of a re-up and that they don’t let anyone divide their interests from the interests of other existing shareholders."

Portfolio News & Jobs

Snyk introduces OS security runtime monitoring. 

James co-founder Pedro Fonseca on how to hire Data Scientists in five steps.

- - - Portfolio Jobs - - -

Vault is hiring developers for front end and back end. Location flexible.

Cloud66 is hiring software engineers in London.

Moltin is hiring for multiple roles in the US and UK.