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Checking the BVP Nasdaq Emerging Cloud Index

Tom Paine

The BVP (Bessemer Venture Partners) Nasdaq Emerging Cloud Index tracks the performance of selected publicly traded Cloud companies .Its performance has far exceeded other major indexes as shown on the above graph. Lately, its growth has been explosive.

The Index trades on Nasdaq under the name EMCLOUD.

The Average Price-to-Revenue multiple is 19.1 The Average Revenue Growth Rate is 39.9%.

Here is the data on the companies that compose the index. Some readers may not follow financial news that closely, but its good to know how companies you may work or partner with are performing, who has the the economic power to buy or dominate others, or who the up & coming stars are. I follow this stuff closely, but am often surprised myself by some changing relative values portrayed in the Index.

One thing you might notice is that there are no Philly-area based companies in the Index, although there are bits & pieces of a few in the region.

Also helpful is the Cloud 100, a list of still-private companies put together by BVP with Forbes and Salesforce Ventures. The Cloud 100 is only published once. per year, so it is more static Several of these companies have already gone public since the end of 2020 when the Cloud 100 was published. No Philly companies here either.

David Galluch, 31, of Newtown Square,
has filed to run for Congress as a Republicans l in PA’s 5th
District. If he wins the nomination, he would face Democratic incumbent Mary Gay Scanlon.

Galluch is currently Senior Manager, Growth and Strategic Development, at Comcast.

Galluch graduated from the Naval Academy, spent years in service, and received his Masters from the University of Cambridge.

In the Navy, he served in the Middle East and Somalia and was a Navy Seal.

Scanlon, the incumbent, receieved 64% in the 2020 race, so Galluch faces an uphill battle. Scanlon had previously been an attorney with Ballard Spahr.

The Fifth District, composed mostly of Delaware County, has been a swing district in recent years.

On Glen de Vries

Tom Paine

Glen de Vries (Medidata)

Glen de Vries, who was killed in a New Jersey plane crash at the age of 49 this past Thursday, was remembered in the general media afterword for two things: having journeyed into space with William Shatner in the previous month, and for the terrible irony for having survived that space flight only to lose his life in a Cessna.

But he must not be remembered merely as a footnote to history.

de Vries was known to Pennsylvanians at both ends of the state: as an alumnus and later a trustee of Carnegie Mellon University; and in the large clinical research community in the Philly area he was known and admired for pushing the envelope for automating the clinical trials process at New York-based Medidata.

He happened to be very successful in business, owning a nice chunk of a company sold to Dassault for nearly $6 billion in late 2o19; he was still serving as an advisor to Dassault at the time of his death. But I think most people recognized him as a scientist first, a businessman second. The pandemic demonstrate the importance of clinical trials being conducted quickly and accurately.

Medidata had some presence in Philly. In 2008, it bought a company named Fast Track Systems in Conshohocken, although no physical sign of it remains. LinkedIn shows 120 people currently as Medidata employees in Greater Philadelphia. From its Radnor offices, Veeva Systems has taken on Medidata in a fierce competitive and legal battle.

Comcast Earnings: A view from several angles

Comcast reported quarterly earnings this past Thursday, and despite its CFO’s recent warning of slower broadband growth, results slightly exceeded analyst expectations. Decent revenue growth from Comcast Cable and a strong bounceback performance from Covid levels from NBCU led to 19% revenue growth in the quarter. Wireless growth was also strong.

Comcast’s business has growing complexity, as Peacock, Sky, Wireless, and in future quarters its smart TV product all need to be analyzed. The following reports cover the results from different angles.

Central Florida’s Universal Orlando Resort has record-breaking quarter, said top exec – Orlando Business Journal (bizjournals.com)

Comcast begins work in Bethany Beach | Bethany Beach | coastalpoint.co

Comcast’s broadband growth slows but wireless may be a hidden gem – MarketWatch

Comcast Takes $520M Loss On Peacock, Doesn’t Disclose New Sign-Ups – The Hollywood Reporter (ampproject.org)

Comcast’s Profit Doubles, Boosted by Tokyo Olympics, Theme Parks – WSJ (ampproject.org)

Apple And Comcast Set Two-Way Streaming Distribution Deal – Deadline (ampproject.org)

Comcast (CMCSA) earnings Q3 2021 (cnbc.com)

Chesterbrook-based Deacom sells to Texas-based ECI

Tom Paine

Its a classic American story, of the solo entrepreneur taking on the world to build a successful company that competes with huge global enterprises.

Jay Deakins started Deacom out of his basement in the Philly suburbs. Since its founding in 1995, Deacom grew, gradually but consistently, to being acquired by Fort Worth-based ECI Software Solutions, announced today. Terms were not disclosed.

I first wrote about Deacom back in 2011, when it added Yeungling, the brewery, as a customer (it remains one today). Deacom now has 0ver 200 customers and 200 employees.

Deacom provides SaaS and on-premise ERP systems for small & medium batch and process manufacturers (which require different metrics) and distributors. ECI already has an ERP solution for discrete manufacturers.

Jay Deakins will no longer be part of the combined company, but his son Scott Deakins will remain as the Deacom Business Unit Leader.

While Deacom had no external equity funding, ECI is majority-owned by PE firm Leonard Green & Partners, which in turn bought out previous investors Carlyle Group and Apax Partners in late 2020. (Apax continued as a minority owner.) That deal valued ECI at $2.5 billion, per reports. ECI has grown through more than 15 acquisitions and now has more than 1,000 employees.

And though its unlikely that Deacom could have pursued an IPO on its own, ECi is probably in a position to do so if it wishes.

There may also be additional opportunities for rolling up other SME products & services through one provider.

PARAMUS-BASED NUVOLO MANAGES THE CONNECTED WORKPLACE — AND IT’S GROWING FAST

Tom Stanford, CEO and founder of Nuvolo |
Courtesy Nuvolo

 

August 10, 2021  Esther Surden

Nuvolo is the fastest-growing workplace solutions company you’ve probably never heard of, and it is headquartered in Paramus.

In March, the company raised $32 million in a Series C round, which included $1 million from the world-famous Mayo Clinic.

Global venture capital and private equity firm Insight Partners (New York) led the round. Other investors included New Enterprise Associates (New York), Kaiser Permanente Ventures (Oakland, Calif.) and Revelation Partners (San Francisco).

Nuvolo said that it will use the Mayo Clinic’s investment to advance the company’s operational technology (OT) cybersecurity solution, which helps healthcare organizations and other OT-intensive industries address the growing challenges posed by the proliferation of cybersecurity threats from network-connected devices.

In other words, Nuvolo enables organizations to manage their workplaces on one platform, and secures the internet of things for businesses that increasingly rely on connected sensors and devices.

But that’s not all that it does. NJTechWeekly.com interviewed Tom Stanford, founder and CEO of Nuvolo this summer.

According to Stanford, Nuvolo is in a war against “crappy legacy technology.” Companies like Veeva Systems (Pleasanton, Calif.), Salesforce (San Francisco), Workday (Pleasanton) and ServiceNow (Santa Clara, Calif.) are driving cloud adoption in this area, he said. And this, he emphasized, is a catalyst for Nuvolo, “as more customers look to modernize, visually transform and consolidate all of the legacy technology that exists out there in the marketplace.”

Nuvolo’s solution is called “Connected Workplace,” and it is a Software-as-a-Service (SaaS)-based integrated workplace management system (IWMS). IWMSs are the focal point of every digital transformation initiative, he said.

The Marketplace

Stanford filled us in on the marketplace where Nuvolo sits.  There are several market segments, he noted. One, dominated by Accruent (Austin), concerns simple-point-solution maintenance management technologies, largely in capital-intensive industries such as healthcare, life sciences and manufacturing. Many of the technologies used to take care of these assets are 15 to 20 years old.

Nuvolo is in a war against “crappy legacy technology.”

Tom Stanford, Nuvolo

Another market segment is enterprise asset management, which is dominated by companies like Archibus (Boston) and IBM Maximo (Armonk, N.Y.); they do full-scale asset lifecycle management, not for IT assets, but for OT such as medical devices, lab equipment and manufacturing devices.  “My own perspective on those technologies is they haven’t had an innovative thought in a decade. They’re there in those environments because they always have been.”

IWMSs, as defined by Gartner (Stamford, Conn.) and other firms, are becoming increasingly important post-COVID, now that the push for workplace safety and workplace experience is increasing, Stanford said. These systems include facilities management, space planning and management, real estate and lease management, capital project planning, sustainability and energy management. Nuvolo extends past traditional IWMSs to also incorporate workplace experience, project planning, OT security and more.

Nuvolo “provides all of those capabilities on a single platform, fully interconnected, built natively on the most modern capable cloud or SaaS platform in the world with ServiceNow,” said Stanford. “Our business is completely focused on the whole concept of the Connected Workplace. That means managing things like your physical workplace, space planning and your carbon footprint on one platform. And as for security, we’re not just focused on protecting desktops, laptops and communications services, but also on protecting CCTV [closed-circuit television] cameras, pipeline sensors; all of these assets that now have operating system software, MACs [media access control hardware] and IP [internet protocol], and are on the network. It’s the Wild West out there.”

Leading in Security for Connected Devices

With regard to OT security, Nuvolo is leading in this area, though very quietly, Stanford said. And he added, “We secure nearly a million OT devices today from a cybersecurity perspective — not IT, but OT: medical devices, facilities devices, laboratory devices. We are solving a problem that no one else is solving right now.

“The reason we are able to do this is that the Connected Workplace strategy allows Nuvolo to be the single authoritative source of inventory for all the operational technology,” he said.  “We manage all OT from a service-management perspective. We manage the space that it fits in, the device that it sits in. We interact with parts utilization, how it’s performing during the whole OT service-management lifecycle, including the security of the device. This is all part of our Connected Workplace strategy.”

Raising Money During COVID

We asked Stanford about how COVID-19 has affected the company, especially its efforts to raise financing.

“We not only did a financing round, but it was an extraordinary financing round for Nuvolo,” he said. Stanford noted that they had done the entire $32 million raise virtually, although the executive team knew Insight Partners from before the pandemic. “Insight Partners is one of the most prestigious venture financing companies in the world,” he said. Nuvolo also had an “incredible valuation, and we experienced material growth in the business during COVID.” Nuvolo also hired nearly 80 people during 2020.

During the pandemic, “We acquired new customers and grew revenue, not at the rate we had planned in March of 2020, but we made adjustments to our plan. But the bottom line was we took the business off and to the right, and that was a big part of getting the financing.”

“People ask me, ‘Did you plan for a rainy day?’ I answer, ‘Yeah, I started planning for a rainy day seven-and-a-half years ago, when I started Nuvolo.’”

Tom Stanford, Nuvolo

Nuvolo has always been a frugally run company, he said. It had previously raised about $30 million, which was about a quarter of what comparable companies had raised. Also, “We take good care of our customers and our teammates. We are a good company to do business with and we planned ahead,” he said.

“People ask me, ‘Did you plan for a rainy day?’ I answer, ‘Yeah, I started planning for a rainy day seven-and-a-half years ago, when I started Nuvolo.’”

Thinking Out of the Box about Hiring

The raise will also enable the company to employ even more crucial employees. “We are going from 300 people to the low to mid 500s by the end of the year. And 14  or 15 months post fundraising, we will double the head count of the company,” he said.

Stanford noted that there are about 60 employees who live and work in New Jersey and, “We expect that by next year there will be over 100.” The company started to flex back to the office around July 4, on a voluntary basis.

Getting STEM workers is a challenge for Nuvolo, Stanford noted, and that has led the company to do some out-of-the-box thinking about hiring. “We have a good working relationship with the New Jersey Institute of Technology,” and the company will be implementing its New Talent Program with NJIT and two other institutions in the United States “to get some time-zone variability.” Nuvola is also participating in the similar Freshers program in India and Sofia, Bulgaria.

“We want to be talking to the kids in their sophomore and junior years, starting to build and cultivate those relationships, and we’re not going to start hiring them in fives and sixes. We’re going to start hiring them in groups of 25 and 50. Here’s the value proposition, and we call it the “New Talent Program.” The idea is, get these kids when they’re 19 to 20. Get them assimilated into Nuvolo and get them to know us, and then we will make a huge commitment to onboarding and resourcing. We will then bring them into a structured six-to-nine-month assimilation program. We’ll teach them React, teach them ServiceNow, teach them JavaScript if they don’t have those basic skills already… and try to leverage it so [we have] 36 to 48 months of continuity with those resources.”

Stanford noted that this isn’t philanthropy on the company’s part. There just aren’t enough people trained in these areas for the company to hire. “We have to be in the business of training, enabling and building talent and capability. That’s going to be the secret to our success. We have to grow with some speed. You know we’re going to go to 600. Then we’re going to go right to 1,200 very, very quickly. You either grow or die in this space, and if we do this very well, we can grow quickly and maintain our culture,” Stanford said.

Esther Surden is Publisher & Founder of NJTechWeekly. This post originally appeared in NJTechWeekly, and is republished here with the author’s permission.

Toast files for IPO; xtraChef founders to benefit?

Tom Paine

Toast, the Boston-based restaurant management cloud startup, finally announced its filing for an IPO that may value the company at as much of $20 billion per reports. Toast would trade on the NYSE under the symbol “TOST”.

In addition to functioning as a sort of ERP for individual restaurants, Toast also helps its customers manage delivery services, maintaining control over the various food delivery vendors they deals with.

Toast reported $704 million in revenue in the first half of 2021, a 105% gain over the worst period of the pandemic last year.

At the beginning of the pandemic, Toast was thinking about survival, cutting half its staff. But by November of last year, Toast was recovering, reaching an $8 billion valuation.

Locally, Toast’s major impact comes from its acquisition of Philly-based xtraChef, which it purchased in early June of this year. xtraChef provides cost and productivity analysis tools specific to restaurants.

While I haven’t seen a breakdown of xtraChef’s acquisition terms, a slice of Toast’s equity could make this exit a very good outcome for xtraChef and its cofounders Andy Schwartz (CEO) and Bhavik Patel (CTO), who both remain witb xtraChef in their existing positions.

Fanatics spreads its wings in two directions

Tom Paine

Michael Rubin’s Fanatics Inc. last week announced new funding that raised its valuation to $18 billion. The Jacksonville-based company, a part of Rubin’s Conshohocken-based Kynetic LLC holding company, is widely viewed as a soon-to-be IPO candidate.

Now Fanatics is attempting to branch in two new directions that do not involve apparel sales, potentially adding to its growth and increasing margins.

First, it won a license from the MLB Players Association, first reported today, replacing Topps (and Panini’s) as the exclusive baseball card partner of the MLBPA after Panini’s and Topps’ licenses with the MLBPA expire at the end of 2022.

The deal also includes the National Basketball Players Association and the NFL Players Association.

Meanwhile, Shawn “Jay-Z” Carter and Rubin are a part of a group applying for an online sports betting license in New York, and plan to form Fanatics Sportsbook.

Sports betting tech company Kambi is leading that bid that also includes Berks County-based gaming giant Penn National, which owns Barstool Sportsbook.

The New York State Gaming Association is aiming to award the new licenses by December 6, so betting can start on the Super Bowl.

In both initiatives, Fanatics stressed the opportunity to leverage its unique fan databases on the new businesses.

Philly People on “Business Transformation 150”

Constellation Research, a Silicon Valley-based tech research & advisory firm headed by R “Ray” Wang, has just released its 2020-2021 “Business Transformation 150″, which Constellation describes as “an elite list that recognizes the top global executives leading business transformation efforts in their organizations. Nominations from peers, technology vendors, industry influencers, and analysts power this listing.”

The BT 150 is all about Digital Transformation.

The BT 150 has its share of Philly area people:

Matthew Ernst

Sr. Director Technical Operations at Tendo Systems / ex – Jefferson Health

Chris Fielding

CIO at Sungard Availability Services


John T Marcante

Global Chief Information Officer Vanguard / Board member

Ann Michael

  CEO at Delta Think

Robert Neff

  Senior Director Product Management at Tendo Systems / ex- Jefferson Health)

Michele Norin

 Sr. Vice President and Chief Information Officer at Rutgers University

Claire Rutkowski

Chief Information Officer
Bentley Systems

Jim Swanson

EVP and Group CIO
Johnson & Johnson – A Drexel grad

Others mentioned include :

Bill McCorey

SVP – Global CIO
Universal Parks and Resorts / Comcast NBCU

Steven John

CIO at Aramark Uniform Services, AmeriPride Services, and Aramark Refreshment Services