Possible VC Interest, Acquisitions add to Buzz Surrounding Cloud Computing
Posted by Geoffrey M on February 13, 2012 | Comment (3)
With a focus on cloud computing for this year’s Tech@Tuck, we thought it would be interesting to highlight two relevant events recently in the cloud computing space. First, Kleiner Perkins is said to be considering a cloud-specific VC fund. Known for its investment savvy, the firm has helped fund companies such as Amazon, Google, and Intuit. A cloud-specific fund is a strong signal that Kleiner Perkins believes that the cloud’s growth potential is real.
In other news, Oracle has announced its intention to acquire Taleo, a provider of cloud-based work force management software for $1.9 billion. The acquisition will extend Oracle’s cloud offerings as it seeks to compete with SAP in the space. An interesting fact about the acquisition: Oracle paid an only 18% premium for the company, compared to the 52% premium SAP paid in December for Success Factors, a company similar to Taleo. Why such a sharp drop in price premium? There has been a large amount of consolidation in the space. Could this consolidation be slowing because fewer and fewer “matches” are possible as companies such as SAP, IBM, and Oracle build out their cloud solutions? It will be interesting to see whether the deals continue, and whether the remaining independent providers are able to compete with the so-called one-stop cloud shops that these large software companies seem to be building. There is no doubt that the space is becoming more and more competitive. How will the smaller players differentiate themselves?