FWD: Outlook — November 9, 2015 — FWD: Outlook

FWD: Outlook — November 9, 2015

The top two stories in tech from around the web

“Mobile, Ecosystems and the Death of PCs”
– Benedict Evans of Andreessen Horowitz

As I said in October 22nd’s edition of FWD: Outlook, the PC as we know it is dead. The OS, the platform, the landline equivalent of access — all of it is history. My children will get a kick out of the idea that ol’ Dad once burned his legs on a laptop the size of an encyclopedia (also, what’s an encyclopedia in hard copy?), and that there was once a “family computer” in the living room that weighed ~45 lbs.

This, however, misses the point. “Mobile,” as Benedict defines it, is as much about portability as “PC” is about personal. The tectonic shift that threatens to eclipse the importance of mobility in technology today is the shift towards the adoption of a mobile operating system.

“The ecosystem of ARM, iOS and Android, with 10x the scale of Wintel, will become the new centre of gravity throughout computing. It will take over things like IoT and wearables in one direction and, in due course, the data centre in the other, and it will push onto the desktop.”

As Benedict notes, “No-one is going to found a new company to make Win32 applications (though enterprise Windows apps will be worked on for a long time, just as mainframe apps were).” They’re not gone for good in the same way that prop planes aren’t gone for good. They’re just not how we get around anymore.

“The Mobile Downturn (continued)” by Fred Wilson of Union Square Ventures

“2015 Software Startup IPOs and M&A — What Does the Data Imply for 2016?”
– Tom Tunguz of Redpoint

M&A is down like the AWOLNATION cat. Market activity this year is at 40% of what it was this time last year. The wheels have also come off the IPO bus as well. Startup funding is so high that private markets (and their secondaries) are more lucrative than public markets. When every IPO is a down round from the private market, founders ask themselves, why go public?

So what does this mean for 2016? As private valuations fall in line with the public markets, Tom forecasts a frothy base of M&A activity in what I’ve previously called The Great Consolidation.

Take it from Tom:

[Diminishing valuations] will catalyze a wave of acquisition because for the last 18 months or so, the opposing forces of increasing private valuations and decreasing public valuations have made start up acquisitions substantially more expensive. In the next 18 months, the converse will be true and cash-rich acquirers who have been looking to bolster their product lines and develop new areas for growth will perceive startups as far more attractive acquisitions at more reasonable prices.

It’s about to be a great season to be in corp dev.

People Are Talking About: Purpose, Intent, and Authenticity

“The Power of Purpose at Work” by Reid Hoffman of Greylock Partners

“Quality of Life: What Does it Mean for a Start-Up?” by Jason M. Lemkin of Storm Ventures

“Authenticity in Business” by Kanyi Maqubela of Collaborative Fund

“Board Effectiveness Tip #4: Make Sure Your Board Talks to Your Team” by Albert Wenger of Union Square Ventures

“How Surfing Made Me a Better Investor” by John Greathouse of Rincon Venture Partners

“Startups-Getting Off The Ground” by Jeffrey Carter of West Loop Ventures