Venture Capital (VC) investment in the U.S. continued performing at a high level during Q1 ’19 with $32.6 billion invested as the U.S. economy remained strong, and increased IPO activity set the stage for further investment at all points of the deal spectrum — from early stage to late stage, according to KPMG’s Venture Pulse Q1′ 2019 report.
The largest deals in Q1’19 included a $5 billion raise by shared-space provider The We Company (formerly WeWork), and a $1 billion raise by freight logistics company Flexport – earning that company coveted unicorn status.
“In the past five years, the number of U.S. unicorns has more than doubled to over 160 as private capital is readily available allowing companies to stay private longer,” said Brian Hughes, National Co-leader, KPMG Venture Capital practice in the U.S. “We finally saw some unicorns choosing to go public in late 2018, and this unicorn IPO trend is expected to continue well into this year, spurred by recent high profile offerings and the ongoing strength of the public markets.”
Lyft hosted a successful IPO on Nasdaq in late March, raising $2.3 billion to value the company at $24 billion. It is the first in a line of large IPO unicorns expected in 2019, with ride-hailing company Uber also expected to file publicly, amongst others. The good performance of these unicorn companies in the early part of 2019 will trigger more investor interest in mature unicorns later in the year, in addition to providing additional capital for early stage deals.
U.S. investors continued to invest in established verticals in Q1’19, including food-delivery, healthcare and transportation, while mega-funds gained a significant amount of attention, coupled with strong activity in smaller-size funds.
Growth and Innovation Occurring Beyond Silicon Valley
The report found a growing boom of VC investment outside of Silicon Valley and the West Coast. In 2018, while 39 percent of VC deals occurred on the West Coast, 20 percent occurred in the Mid-Atlantic region, 9 percent in New England, and 9 percent in the Great Lakes region. These numbers reflect the growing number of innovation hubs appearing in cities such as New York, Boston and others –a trend continuing this year.
In Q1’19, New York and New Jersey both attracted big deals, such as The We Company’s $5 billion raise, and Knock’s $400 million raise.
Among companies headquartered in Silicon Valley, there has been a shift toward scaling outside of the Valley in order to access or attract talent and better manage labor and space costs. Late in 2018, for example, Slack announced a new Denver Office, while other companies set up offices in Arizona, Salt Lake City and beyond. This trend is only expected to continue as companies look to balance a presence in the Valley with the need to scale and grow efficiently.
Digital Banking Heats Up
The digital banking space in the US continued to gain traction in Q1’19. Chime’s Q1’19 $200 million raise earned it unicorn status, with a number of non-U.S.-based banks voicing plans to raise capital to fund a U.S. expansion.
The U.S. is well positioned for growth
The maturing fintech sector is also expected to see more M&A activity as companies are looking for scale and consolidate market share. In Q1’19, FIS announced plans to acquire Worldplay in a $34 billion deal.
“The story in the U.S. continues to be very positive. The 2018 IPOs generally performed very well and the pre-public companies that have completed financings recently have been at high valuations,” said Conor Moore, National Co-Lead Partner, KPMG Venture Capital practice in the U.S. “This should encourage greater investment at all points on the investment spectrum from seed to late stage.”
SOURCE KPMG LLP
Nintex Expands Cloud Options for Enterprises in Europe
Nintex, the global standard for process management and automation, today announced that its flagship process automation solution, Nintex Workflow Cloud, is available to customers in the European Union through a Microsoft Azure data centre in Ireland.
The availability of Nintex Workflow Cloud via an EU data centre means that customers throughout the European Union can adopt Nintex’s market-leading process automation capabilities with confidence that Nintex is addressing their data privacy and residency concerns and requirements. Nintex Workflow Cloud availability joins Nintex for Office 365, which is already hosted and being used by enterprise organisations in the EU.
“Organisations in every industry are embracing the Nintex Process Platform to drive rapid digital transformation,” said Florian Haarhaus, Nintex Vice President for Sales for Europe, Middle East, and Africa. “With the new EU data centre for Nintex Workflow Cloud, we provide European customers with another onramp to the cloud with full support for their data residency requirements.”
“Many companies have approached us about moving to the cloud but have had concerns about privacy, regulatory compliance and approval from their Workers’ Councils and data protection commissioners,” said Henning Eiben, a Nintex virtual technical evangelist with busitec in Münster, Germany. “They have to be really careful about how customer data flows through their systems. A Nintex Workflow Cloud data centre in the EU offers companies increased security in moving to the cloud. It opens up new possibilities.”
More than 8,000 organisations worldwide leverage the Nintex Process Platform to quickly and easily map, manage, automate, and optimise enterprise-wide business processes with clicks, not code. Enterprises are rapidly adopting Nintex cloud solutions for their leading-edge automation capabilities as well as the rapid provisioning, low capital expenditure, and easy scalability of cloud solutions.
“Companies are using more and more services, scattered across multiple clouds,” Eiben said. “The power of Nintex Workflow Cloud is that it lets you stitch those services and systems together. We use Nintex Workflow Cloud that way ourselves and recommend that approach to our customers.”
The Nintex platform provides the most complete and powerful set of automation capabilities on the market, including process mapping, automatic creation of workflows, RPA, responsive forms, mobile apps, document automation, and process intelligence.
A new capability, Nintex Workflow Generator, uses natural language processing to instantly create sophisticated workflows, bridging the gap between process knowledge and automation expertise. Process experts can use cloud-based Nintex Promapp® to quickly document a process, then click “Request Automation” to create a draft workflow in Nintex Workflow Cloud and alert the IT department.
Nintex’s cloud services leverage top-tier infrastructure providers to ensure compliance with EU data residency and privacy rules, as well as the availability, resiliency, latency, and security our customers require.
Nintex recently received an exception-free SOC 2 audit report from an independent auditing firm that validates the effectiveness of the security controls in Nintex Workflow Cloud. The favourable audit result reflects Nintex’s ongoing commitment to ensuring the protection of customer, partner, and end-user data.
ServiceTitan to Present at ProductCon, World’s Largest Product Management Conference Series
ServiceTitan, the world’s leading all-in-one software and operating system for residential and commercial service and replacement contractors, announced today that Edward Yip, the company’s vice president of products, and Julia Baker, director of technical project management, will be featured as guest speakers at the Los Angeles ProductCon conference for a discussion on maturing a product organization from startup to mid-growth.
ProductCon is a product management conference series focused on the best practices behind the most successful products and new trends in artificial intelligence, virtual reality, the internet of things and blockchain. The talk will spotlight Yip and Baker’s experience developing product organization for ServiceTitan as the company has matured.
“Most startups begin with loose processes, role definitions and metrics,” Yip said. “As a product management team grows bigger, there is a transition period, and you can’t operate as loosely anymore. That’s when there is a need for Product Operations.”
The duo heads the product management department for ServiceTitan, and both have extensive experience in the industry. Yip joined ServiceTitan earlier this year as vice president of products. He previously led product management at major technology firms Google and ServiceMax. Baker joined the company in 2017. She has managed other tech product teams and has worked at Amazon and Yellow Pages prior to joining ServiceTitan.
“Transitioning from startup to mid-growth requires more distinct roles for a product manager,” Baker said. “A product manager for a startup is a Jack-of-all-trades. You learn to be very comfortable with ambiguity and swift changes as the company grows to scale. As a product manager of a midsize company, your role is more fine-tuned and requires a completely different set of skills.”
Major Professional Security Services Providers Transitioning Offerings to a Customer Engagement Model By 2023
Cyberattacks are increasing, and as organizations expand into new platforms such as cloud, IoT, connected devices, and mobility, so does their potential vulnerability, making it increasingly difficult to fend off cyber adversaries. Growth and diversity are, therefore, a priority in the global managed and professional security services market, which is expected to grow from $21 billion in 2018 to $35.6 billion in 2023, at a compound annual growth rate (CAGR) of 11.1%.
Frost & Sullivan’s latest research, Global Managed & Professional Security Services Market, Forecast to 2023, finds that the top five providers, which account for 42% of the global market, grew 27.6% year-over-year in 2018 due to their massive size, global reach, consultative strength, industry expertise, and established relationships with large enterprises and government agencies. In terms of broad service categories, professional security services represented 61% of the global market in 2018. Within professional security services, assessment and advisory offerings continue their upswing. In managed security services, detection & response is growing at the fastest pace and in strategic importance down market.
For further information on this analysis, please visit: http://frost.ly/3ul.
“Despite robust market demand, providers must evolve in this competitive market. Similar to their clients’ digital innovation, their platform of services and how they offer them will be required to change in order to remain competitively vibrant in this market,” said Jarad Carleton, Global Program Leader of Cybersecurity at Frost & Sullivan. “Managed security services are increasingly being repackaged as customer self-service offerings, and providers that have historically concentrated on professional security services are strategically investigating managed security services.”
Providers are improving the productivity of their security talent and presenting better curated and prioritized risk management perspectives to their clients through automation, the most extensive technology trend, which includes artificial intelligence and machine learning. Including intellectual property in processes and procedures is contributing to the growing availability and array of customer self-service and as-a-service offerings from security service providers.
“Automation can be a double-edged sword as it improves provider means to serve their clients but also facilitate clients to serve themselves,” noted Carleton.
With a heightened potential for cyber risks, companies operating in this sector should explore the following growth opportunities:
- Measurable outcomes rather than completed tasks are the yardstick for security services and what customers will buy.
- The customer engagement model will become increasingly varied, encompassing outsourcing and tiers of co-managed and self-managed.
- Security expertise will be insufficient. Successful providers must be staffed with software developers, data scientists, and machine-learning model builders.
- In Europe, proactive customer engagement, helping GDPR compliance through better security, and offering “right-sized” managed security solutions will create growth opportunities across the region.
- Market opportunities in APAC and LATAM and globally down-market are growing but will require new strategies to maximize market potential.
Global Managed & Professional Security Services Market, Forecast to 2023 is a part of Frost & Sullivan’s Information and Communications Technology Growth Partnership Service program, which helps organizations identify a continuous flow of growth opportunities to succeed in an unpredictable future.
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