Mergermarket Technology Forum

May 11, 2017 | Hyatt Regency, San Francisco

Welcome to Mergermarket's annual Technology Forum!

Among all M&A deals announced last year, 15% were acquisitions of technology companies, more than any other sector and totaling roughly USD 125bn. Large cash balances and flatlining revenue nudged long-standing firms to invest in tech startups, such as Walmart's purchase of e-commerce startup Jet.com. Even savvy VC investors have expressed astonishment at the pace at which digital transformation moved to the forefront of corporate boardrooms recently.

While technology M&A can provide revenue growth and impressive returns for VC funds, plenty of challenges remain. The question of valuations is troubling for some who wonder if another tech bubble is brewing in light of "unicorns" totaling USD 372bn in worth across the US. Additionally, cybersecurity continues to appear in the headlines as the damage of a single data breach can cost an average of USD 4m per company and can stop a deal in its tracks. Look no further than Verizon executives second guessing their acquisition of Yahoo shortly after the Internet firm announced the hacking of roughly 500 million users' credentials.

Please join esteemed panelists and network with industry experts for an afternoon filled with content-driven discussions relating to the forces driving M&A and financing in the technology sector.

Agenda

Registration And Light Refreshments

Opening Remarks

M&A In The Valley

The TMT sector completed 3,021 deals worth USD 698.2bn last year, representing a decrease of 4.5% in value and 5.7% in deal count compared to 2015. Will things look up in 2017? Deal activity did accelerate toward the end of 2016 after Donald Trump’s victory as he promised to deregulate markets and repatriate cash held overseas, the vast majority being held by tech companies. Also, cybersecurity, enterprise software, and virtual reality headset makers could lift M&A volume as VCs and businesses across a range of sectors invest millions in applications for these technologies.

What is the outlook for technology M&A as we head into 2017?

  • What factors will drive dealmaking?
  • Explore where valuations are pulling back
  • What impact will the policies of the new administration have on the sector?
  • Where are the new opportunities for investment in 2017? (e.g. VR headset, cybersecurity, etc.)
  • Examine the convergence between cybersecurity and Internet of Things

Coffee Networking Break

Changing Landscape In Enterprise Software Investment

Serial entrepreneurs and VCs love subscription-based revenue models, causing a lot of investment to be channeled into software-as-a-service (SAAS) and traditional software products. One result is market consolidation, thereby creating frothy valuations for SaaS vendors. Firms such as Conversica, the California-based AI software company, are courting potential buyers like Vista Equity Partners. Sensing opportunity, activist investors are pressuring SaaS and other software vendors to seek out strategic sales.

What is driving this frenzy in investments of enterprise software tech and what are the emerging risks?

  • What examples have been set by noteworthy deals in this space? (e.g. Carlyle Group's acquisition of Veritas Technologies Corp, Vista Equity Partners purchase of Solera Holdings, etc.)
  • Examine private equity and activist investors' role in influencing software M&A
  • What areas of enterprise software are most ripe for investment, from Fintech and Internet of Things to Advertising and Marketing?
  • What challenges are present in the market place? (e.g. valuations, pressure to sell, etc)

Exit Opportunities Poised For Strong 2017

After a disappointing IPO market in 2016 when a dozen tech IPOs posted double-digit price declines since going public, many industry observers are expecting a noticeable bounce back in 2017. Proving this point, strong performances from Twilio and Nutanix have prompted discussions between many private companies and bankers for possible 2017 listings. On the strategic sales front, Jasper's USD 1.4bn sale to Cisco and Ping Identity's sale to Vista Equity Partners sent positive signals. That said, the few bright spots in 2016 are setting the stage for VCs and others to broaden their exit opportunities.

What will become of the IPO market in 2017?

  • Examine the rise of "non-tech" companies becoming aggressive buyers of tech firms
  • What risks stem from a pullback in valuations and how will this impact exit multiples?
  • Will Snap’s IPO serve as a bellwether for listings over next 12 months?
  • Address top concerns from management who are bracing for new ownership
  • Cocktail Reception

    *Agenda is subject to change

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    Venue


    Hyatt Regency

    5 Embarcadero Center
    San Francisco, CA, 94111