- Sysdig, Fivetran, Nuxeo, Cloudian, Mendix, StreamSets, Zscaler, Zoho, SAP, OutSystems, Kony, and Netskope are the most likely to be recommended by their employees to friends looking for a cloud computing company to work for in 2019.
- Cloud platform and development companies dominate the highest rated cloud businesses when indexed by the percent of employees who would recommend their company to a friend.
- Taken together, the 12 CEOs leading the top-rated cloud computing companies are approved by 98% of employees as of March 3, 2019, on Glassdoor. CEOs in this group include Thomas Hogan of Kony, Paulo Rosado of OutSystems, Bill McDermott of SAP, and Sridhar Vembu of Zoho.
These and many other insights are from an analysis completed today comparing Computer Reseller News’ 100 Coolest Cloud Computing Vendors of 2019 by their respective Glassdoor scores. The Computer Reseller News annual list of the 100 coolest cloud computing vendors is an impartial, 3rd party benchmark of the fastest-growing and most likely to hire cloud businesses expanding today. By far the most common request from Forbes readers is which cloud computing companies are the best to work for. The goal of this analysis is to provide readers with insights into which cloud computing companies best fit their skills and at the same time have a strong reputation based on feedback from existing employees.
Indexing the most interesting and fastest growing cloud computing companies by their Glassdoor scores and reputations is a great way to begin defining a long-term career growth strategy. One factor not quantified is how well of a fit an applicant is to company culture. Take every opportunity for in-person interviews, read Glassdoor ratings often and observe as much as possible about daily life in companies of interest to see if they are a good fit for your skills and strengths.
Using the 2019 CRN list as a baseline to compare the Glassdoor scores of the (%) of employees who would recommend this company to a friend and (%) of employees who approve of the CEO, the table below is provided. You can find the original dataset here. There are 15 companies on the CRN list that don’t have that many or any entries on Glassdoor, and they are excluded from the rankings shown below. You can find their mention in the original dataset. If the image below is not visible in your browser, you can view the rankings here.
The highest rated CEOs on Glassdoor as of March 3, 2019, include the following. Please click on the graphic and dataset to expand for easier reading.
The original dataset is shown below:
- 50% of IT professionals believe artificial intelligence and machine learning are playing a role in cloud computing adoption today, growing to 67% by 2020.
These insights and findings are from LogicMonitor’s Cloud Vision 2020: The Future of the Cloud Study (PDF, free, opt-in, 9 pp.). The survey is based on interviews with approximately 300 influencers LogicMonitor interviewed in November 2017. Respondents include Amazon Web Services AWS re:Invent 2017 attendees, industry analysts, media, consultants and vendor strategists. The study’s primary goal is to explore the landscape for cloud services in 2020. While the study’s findings are not statistically significant, they do provide a fascinating glimpse into current and future enterprise cloud computing strategies.
Key takeaways include the following:
- 83% Of Enterprise Workloads Will Be In The Cloud By 2020. LogicMonitor’s survey is predicting that 41% of enterprise workloads will be run on public cloud platforms (Amazon AWS, Google Cloud Platform, IBM Cloud, Microsoft Azure and others) by 2020. An additional 20% are predicted to be private-cloud-based followed by another 22% running on hybrid cloud platforms by 2020. On-premise workloads are predicted to shrink from 37% today to 27% of all workloads by 2020.
- Digitally transforming enterprises (63%) is the leading factor driving greater public cloud engagement or adoption followed by the pursuit of IT agility (62%). LogicMonitor’s survey found that the many challenges enterprises face in digitally transforming their business models are the leading contributing factor to cloud computing adoption. Attaining IT agility (62%), excelling at DevOps (58%), mobility (55%), Artificial Intelligence (AI) and Machine Learning (50%) and the Internet of Things (IoT) adoption (45%) are the top six factors driving cloud adoption today. Artifical Intelligence (AI) and Machine Learning are predicted to be the leading factors driving greater cloud computing adoption by 2020.
- 66% of IT professionals say security is their greatest concern in adopting an enterprise cloud computing strategy. Cloud platform and service providers will go on a buying spree in 2018 to strengthen and harden their platforms in this area. Verizon (NYSE:VZ) acquiring Niddel this week is just the beginning. Niddel’s Magnet software is a machine learning-based threat-hunting system that will be integrated into Verizon’s enterprise-class cloud services and systems. Additional concerns include attaining governance and compliance goals on cloud-based platforms (60%), overcoming the challenges of having staff that lacks cloud experience (58%), Privacy (57%) and vendor lock-in (47%).
- Just 27% of respondents predict that by 2022, 95% of all workloads will run in the cloud. One in five respondents believes it will take ten years to reach that level of workload migration. 13% of respondents don’t see this level of workload shift ever occurring. Based on conversations with CIOs and CEOs in manufacturing and financial services industries there will be a mix of workloads between on-premise and cloud for the foreseeable future. C-level executives evaluate shifting workloads based on each systems’ contribution to new business models, cost, and revenue goals in addition to accelerating time-to-market.
- Microsoft Azure and Google Cloud Platform are predicted to gain market share versus Amazon AWS in the next three years, with AWS staying the clear market leader. The study found 42% of respondents are predicting Microsoft Azure will gain more market share by 2020. Google Cloud Platform is predicted to also gain ground according to 35% of the respondent base. AWS is predicted to extend its market dominance with 52% market share by 2020.
- 2016 worldwide SaaS revenue exceeded Gartner’s previous forecast by $48.2B.
Gartner’s latest worldwide public cloud services revenue forecast published earlier this month predicts Infrastructure-as-a-Service (IaaS), currently growing at a 23.31% Compound Annual Growth Rate (CAGR), will outpace the overall market growth of 13.38% through 2020. Software-as-a-Service (SaaS) revenue is predicted to grow from $58.6B in 2017 to $99.7B in 2020. Taking into account the entire forecast period of 2016 – 2020, SaaS is on pace to attain 15.65% compound annual growth throughout the forecast period, also outpacing the total cloud market. The following graphic compares revenue growth by cloud services category for the years 2016 through 2020. Please click on the graphic to expand it for easier reading.
Catalysts driving greater adoption and correspondingly higher CAGRs include a shift Gartner sees in infrastructure, middleware, application and business process services spending. In 2016, Gartner estimates approximately 17% of the total market revenue for these areas had shifted to the cloud. Gartner predicts by 2021, 28% of all IT spending will be for cloud-based infrastructure, middleware, application and business process services. Another factor is the adoption of Platform-as-a-Service (PaaS). Gartner notes that enterprises are confident that PaaS can be a secure, scalable application development platform in the future. The following graphic compares the compound annual growth rates (CAGRs) of each cloud service area including the total market. Please click on the graphic to expand it for easier reading.
Source: Gartner Forecasts Worldwide Public Cloud Services Revenue to Reach $260 Billion in 2017
Cloud platforms are enabling new, complex business models and orchestrating more globally-based integration networks in 2017 than many analyst and advisory firms predicted. Combined with Cloud Services adoption increasing in the mid-tier and small & medium businesses (SMB), leading researchers including Forrester are adjusting their forecasts upward. The best check of any forecast is revenue. Amazon’s latest quarterly results released two days ago show Amazon Web Services (AWS) attained 43% year-over-year growth, contributing 10% of consolidated revenue and 89% of consolidated operating income.
Additional key takeaways from the roundup include the following:
- Wikibon is predicting enterprise cloud spending is growing at a 16% compound annual growth (CAGR) run rate between 2016 and 2026. The research firm also predicts that by 2022, Amazon Web Services (AWS) will reach $43B in revenue, and be 8.2% of all cloud spending. Source: Wikibon report preview: How big can Amazon Web Services get?
Wikibon Worldwide Enterprise IT Projection By Vendor Revenue
Rapid Growth of Cloud Computing, 2015–2020
Worldwide Public Cloud Services Forecast (Millions of Dollars)
- By the end of 2018, spending on IT-as-a-Service for data centers, software and services will be $547B. Deloitte Global predicts that procurement of IT technologies will accelerate in the next 2.5 years from $361B to $547B. At this pace, IT-as-a-Service will represent more than half of IT spending by the 2021/2022 timeframe. Source: Deloitte Technology, Media and Telecommunications Predictions, 2017 (PDF, 80 pp., no opt-in).
Deloitte IT-as-a-Service Forecast
- Total spending on IT infrastructure products (server, enterprise storage, and Ethernet switches) for deployment in cloud environments will increase 15.3% year over year in 2017 to $41.7B. IDC predicts that public cloud data centers will account for the majority of this spending ( 60.5%) while off-premises private cloud environments will represent 14.9% of spending. On-premises private clouds will account for 62.3% of spending on private cloud IT infrastructure and will grow 13.1% year over year in 2017. Source: Spending on IT Infrastructure for Public Cloud Deployments Will Return to Double-Digit Growth in 2017, According to IDC.
Worldwide Cloud IT Infrastructure Market Forecast
- Platform-as-a-Service (PaaS) adoption is predicted to be the fastest-growing sector of cloud platforms according to KPMG, growing from 32% in 2017 to 56% adoption in 2020. Results from the 2016 Harvey Nash / KPMG CIO Survey indicate that cloud adoption is now mainstream and accelerating as enterprises shift data-intensive operations to the cloud. Source: Journey to the Cloud, The Creative CIO Agenda, KPMG (PDF, no opt-in, 14 pp.)
Cloud investment by type today and in three years
AWS Segment Financial Comparison
- In Q1, 2017 AWS generated 10% of consolidated revenue and 89% of consolidated operating income. Net sales increased 23% to $35.7 billion in the first quarter, compared with $29.1 billion in first quarter 2016. Source: Cloud Business Drives Amazon’s Profits.
Comparing AWS’ Revenue and Income Contributions
- RightScale’s 2017 survey found that Microsoft Azure adoption surged from 26% to 43% with AWS adoption increasing from 56% to 59%. Overall Azure adoption grew from 20% to 34% percent of respondents to reduce the AWS lead, with Azure now reaching 60% of the market penetration of AWS. Google also increased adoption from 10% to 15%. AWS continues to lead in public cloud adoption (57% of respondents currently run applications in AWS), this number has stayed flat since both 2016 and 2015. Source: RightScale 2017 State of the Cloud Report (PDF, 38 pp., no opt-in)
Public Cloud Adoption, 2017 versus 2016
- Global Cloud IT market revenue is predicted to increase from $180B in 2015 to $390B in 2020, attaining a Compound Annual Growth Rate (CAGR) of 17%. In the same period, SaaS-based apps are predicted to grow at an 18% CAGR, and IaaS/PaaS is predicted to increase at a 27% CAGR. Source: Bain & Company research brief The Changing Faces of the Cloud (PDF, no opt-in).
60% of IT Market Growth Is Being Driven By The Cloud
- 74% of Tech Chief Financial Officers (CFOs) say cloud computing will have the most measurable impact on their business in 2017. Additional technologies that will have a significant financial impact in 2017 include the Internet of Things, Artificial Intelligence (AI) (16%) and 3D printing and virtual reality (14% each). Source: 2017 BDO Technology Outlook Survey (PDF), no opt-in).
CFOs say cloud investments deliver the greatest measurable impact
Cloud investments are fueling new job throughout Canada
- APIs are enabling persona-based user experiences in a diverse base of cloud enterprise As of today there are 17,422 APIs listed on the Programmable Web, with many enterprise cloud apps concentrating on subscription, distributed order management, and pricing workflows. Sources: Bessemer Venture Partners State of the Cloud 2017 and 2017 Is Quickly Becoming The Year Of The API Economy. The following graphic from the latest Bessemer Venture Partners report illustrates how APIs are now the background of enterprise software.
APIs are fueling a revolution in cloud enterprise apps
- By 2018, at least half of IT spending will be Cloud-based, reaching 60% of all IT infrastructure, and 60–70% of all Software, Services, and Technology Spending by 2020. IDC also predicts that by 2018, Cloud will also be the preferred delivery mechanism for analytics. Source: IDC FutureScape: Worldwide Cloud 2016 Predictions; Mastering the Raw Material of Digital Transformation (PDF, no opt-in).
- Public cloud platforms, business services, and applications (software-as-a-service [SaaS]) will grow at a 22% CAGR between 2015 and 2020, reaching $236B. Cloud platform revenues, whose 2020 total of $64B will be 45% higher than Forrester projected two years ago. The much larger cloud application market will also grow faster, with the 2020 total of $155B being 17% higher than their 2014 projection. Source: The Public Cloud Services Market Will Grow Rapidly To $236 Billion In 2020.
- Worldwide Cloud IT Infrastructure Spend Grew 9.2% to $32.6B in 2016. Cloud IT infrastructure sales as a share of overall worldwide IT spending climbed to 37.2% in 4Q16, up from 33.4% a year ago. Cloud IT infrastructure sales grew fastest in Japan at 42.3% year over year in 4Q16. Source: Worldwide Cloud IT Infrastructure Spend Grew 9.2% to $32.6 Billion in 2016, According to IDC.
- 451 Research: China and India emerging as cloud computing powerhouses in Asia-Pacific (PDF, no opt-in)
- An Overview of the AWS Cloud Adoption Framework, Version 2, Feb. 2017 (PDF)
- Bessemer Venture Partners State of the Cloud 2017.
- Gartner Says Worldwide Public Cloud Services Market to Grow 17 Percent in 2016
- Health IT and the Cloud, 2017 (infographic, PDF)
- How the Microsoft Ecosystem and Cloud Computing Will Create 110,000 New Jobs in Canada from 2015 to 2020 (PDF, no opt-in)
- Hybrid Cloud: The New Standard for Delivery of Digital Transformation
- IDC’s Latest CloudView Multiclient Study Reveals Attitudes and Strategies of the 58% of Organizations Embracing Cloud
- Journey to the Cloud, The Creative CIO Agenda, KPMG (PDF, no opt-in, 14 pp.)
- RightScale 2017 State of the Cloud Report (PDF, 38 pp., no opt-in)
- Spending on IT Infrastructure for Public Cloud Deployments Will Return to Double-Digit Growth in 2017, According to IDC.
- Survey: 93% of Organizations Use Cloud-based IT Services
- The Forrester Wave™: Global Public Cloud Platforms For Enterprise Developers, Q3 2016 (PDF, 17 pp., no opt-in, courtesy of Microsoft)
- The Salesforce Economy: Enabling 1.9 Million New Jobs and $389 Billion in New Revenue Over the Next Five Years, IDC. (PDF, no opt-in)
- Why Custom Apps Grew $100B In The Last 5 Years
- Worldwide Cloud IT Infrastructure Spend Grows 23.0% to $7.6 Billion in the Third Quarter, According to IDC
- Worldwide Competitive Public Cloud PaaS Forecast, 2015–2019.
- Organizations are using multiple cloud models to meet their business’s needs, including private (62%), public (60%), and hybrid (26%).
- By 2018 the typical IT department will have the minority of their apps and platforms (40%) residing in on-premise systems.
These and many other insights are from IDG’s Enterprise Cloud Computing Survey, 2016. You can find the 2016 Cloud Computing Executive Summary here and a presentation of the results here. The study’s methodology is based on interviews with respondents who are reporting they are involved with cloud planning and management across their organizations. The sampling frame includes audiences across six IDG Enterprise brands (CIO, Computerworld, CSO, InfoWorld, ITworld and Network World) representing IT and security decision-makers across eight industries. The survey was fielded online with the objective of understanding organizational adoption, use-cases, and solution needs for cloud computing. A total of 925 respondents were interviewed to complete the study.
Key takeaways include the following:
- The cloud is the new normal for enterprise apps, with 70% of all organizations having at least one app in the cloud today. 75% of enterprises with greater than 1,000 employees have at least one app or platform running in the cloud today, leading all categories of adoption measured in the survey. 90% of all organizations today either have apps running in the cloud are planning to use cloud apps in the next 12 months, or within 1 to 3 years. The cloud has won the enterprise and will continue to see the variety and breadth of apps adopted accelerating in 2017 and beyond.
- Business/data analytics and data storage/data management (both 43%) are projected to lead cloud adoption in 2017 and beyond. 22% of organizations surveyed are predicting that business/data analytics will be the leading cloud application area they will migrate to in the next twelve months. 21% are predicting data storage/data management apps are a high priority area for their organizations’ cloud migration plans in 2017. Three of the market leaders in analytics are Tableau, QlikView and Microsoft Power BI. They are analyzed in this recent post from SelectHub, accessible here.
- 28% of organizations’ total IT budgets is dedicated to cloud computing next year. Of that, 45% is allocated to SaaS, 30% to IaaS and 19% to PaaS. The average investment organizations will make in cloud computing next year is $1.62M, with enterprises over 1,000 employees projected to spend $3.03M. The average investment in cloud computing remains constant in organizations with $1.62M invested in 2014, $1.56M in 2015 and $1.62M in 2016. 10% of enterprises with over 1,000 employees are projecting they will spend $10M or more on cloud computing apps and platforms throughout this year.
- CIOs, IT architects and IT networking/management control cloud spending in the enterprise. In contrast, CEOs, CIOs, and CFOs are driving small and medium business (SMB) cloud spending this year. The following graphic compares how influential the following groups and individuals are in the cloud computing purchase process.
- Just 46% of organizations are using Application Programmer Interfaces (APIs) to integrate with databases, messaging systems, portals or storage components. 40% are using them for creating connections to the application layer of their cloud and the underlying IT infrastructures. The following graphic provides insights into how APIs are being used and which teams see the most value in them.
- In 18 months the majority of organizations’ IT infrastructures will be entirely cloud-based. IDG found that in 18 months nearly one-third (28%) of all organizations interviewed will be relying on private clouds as part of their IT infrastructure. Just over a fifth (22%) will have public cloud as part of their IT infrastructure, and 10% will be using hybrid By 2018 the typical IT department will have the minority of their apps and platforms (40%) residing in on-premise systems.
- Concerns about where data is stored (43%), cloud security (41%) and vendor lock-in (21%) are the top three challenges organizations face when adopting public cloud technologies. Private and hybrid cloud adoption in organizations is also facing the challenges of cloud security and vendor lock-in. Private and hybrid cloud adoption are being slowed by a lack of the right skill sets to manage and gain the maximum value from cloud investments.
- During the 2Q16 call, Google called out Cloud as the primary driver of the re-accelerating growth for Licensing and Other revenue, the first time the business has been called out in pole position.
- Recent Orbitera and Apigee acquisitions underscore Google’s new focus and aggressiveness to grow GCP. Google has spent $1B+ on Cloud M&A over the past 12 months.
- Deutsche Bank predicts GCP is preparing a series of new product announcements in September to strengthen their customer-facing roadmap further.
These and other insights are from Deutsche Bank Markets Research study, Google Getting More Aggressive In The Cloud, (client access) published 8 September 2016 by Ross Sandler Karl Keirstead, Deepak Mathivanan, Aki Aggarwal and Taylor McGinnis. Deutsche Bank found that Google is investing heavier in the cloud, making a financial commitment with over $1B in acquisitions in the past year including the recent Apigee deal. The study is based on interviews Deutsche Bank contacted with channel partners, prospects, partners, and customers. Despite the renewed focus on growth, Deutsche Bank predicts that GCP would continue to trail AWS and Microsoft Azure for the foreseeable future.
Key takeaways of the Deutsche Bank Markets Research survey include the following:
- Deutsche Bank defines the Total Available Market (TAM) enterprise IT spend in nine categories that together account for over a $1T TAM. Deutsche Bank defines the Enterprise IT spending market by combining storage, network equipment, infrastructure software, IT outsourcing and support, data management software, BI/analytics, application software and consulting Deutsche Bank sees AWS make significant progress across a wide spectrum of their taxonomy categories.
- GCP new product launches are concentrating on machine learning, data analytics and security, including data encryption and identity and access management. Google’s aggressiveness regarding the cloud is most visible from their new service announcements shown in the table below. Recent announcements include SQL Server Images, where customers can now natively spin up Microsoft database instances on GCP, akin to AWS RDS for SQL Server. GCP also announced a second generation version of Cloud SQL, its cloud-hosted alternative to MySQL and AWS Aurora. While all of these announcements provide GCP with greater potential to compete against AWS and Microsoft Azure, Google’s two larger competitors have formidable momentum in enterprises.
- Aggressive build-out of global infrastructure locations continues. Google announced during their 4Q15 earnings call they would build 12 new regions in 2016 and 2017. Of the 12 new planned GCP regions, the US Western region in Oregon opened in July 2016, and Google has said that the new Tokyo region will be available later this year, leaving ten more regions to be added in 2017.
- Google continues to believe in the importance of machine learning and artificial intelligence. Deutsche Bank interviews with GCP customers confirmed interest in using machine learning and artificial intelligence on the Cloud. Customers also perceive GCP is well ahead of AWS and Azure in this regard.
- Google is quickly hiring enterprise sales reps in an attempt to close the sales gap between themselves and AWS & Microsoft Azure. Deutsche Bank found that Google has been “hiring very aggressively” to scale its enterprise sales rep capacity and also retrofitting existing sales reps from elsewhere in Google into GCP.
- GCP is gaining share rapidly within the startup community. Deutsche Bank spoke with customers who estimated that 25% startups are using GCP today (with 75% on AWS), while another estimated the ratio to be 20%/80%. While both agreed that a couple of years ago only 10% of startups were using GCP (with 90% using AWS). During the GCP NEXT Asia-Pacific keynote earlier this month Google disclosed that Snapchat “is one of our largest customers,” making up to 2 million queries per second and consuming more Google bandwidth than any other organization except for YouTube.
- Recent Orbitera and Apigee acquisitions underscore Google’s new focus and aggressiveness to grow GCP. Last month Google acquired Orbitera, a small cloud commerce platform. Orbitera simplifies the buying and selling of cloud-based software by providing vendors with packaging and provisioning, billing, and marketplace solutions on AWS and Azure. Earlier this month Google acquired Apigee for $625M, which is 5.2x Apigee’s FY17e revenues of $120M. Apigee is expected to grow by 30%-35% in The company focuses on larger enterprises (Walgreens, Nike, Target, AT&T) and despite an ongoing mix shift to the cloud or SaaS model, it still has a legacy on-premise license/maintenance business.
- Google is very focused on building relationships with all systems integration (SI) firms but that building out a GCP channel is proving to be challenging. Deutsche Bank believes that Microsoft is also finding it tough to build out it’s Azure channel, in part because many traditional partners and resellers struggle with how they can monetize Azure, given its different price points and the lower services attach rate
- 73% of midmarket companies say the complexity of their stored data requires big data analytics apps and tools to better gain insights from.
- 54% of midmarket companies’ security budgets are invested in security plans versus reacting to threats.
These and many other insights are from Dell’s second annual Global Technology Adoption Index (GTAI 2015) released last week in collaboration with TNS Research. The Global Technology Adoption Index surveyed IT and business decision makers of mid-market organizations across 11 countries, interviewing 2,900 IT and business decision makers representing businesses with 100 to 4,999 employees.
The purpose of the index is to understand how business users perceive, plan for and utilize four key technologies: cloud, mobility, security and big data. Dell released the first wave of its results this week and will be publishing several additional chapters throughout 2016. You can download Chapter 1 of the study here (PDF, no opt-in, 18 pp.).
Key take-aways from the study include the following:
- Orchestrating big data, cloud and mobility strategies leads to 53% greater growth than peers not adopting these technologies. Midmarket organizations adopting big data alone have the potential to grow 50% more than comparable organizations. Effective use of Bring Your Own Device (BYOD) mobility strategies has the potential to increase growth by 53% over laggards or late adopters..
- 73% of North American organizations believe the volume and complexity of their data requires big data analytics apps and tools. This is up from 54% in 2014, indicating midmarket organizations are concentrating on how to get more value from the massive data stores many have accumulated. This same group of organizations believe they are getting more value out of big data this year (69%) compared to last year (64%). Top outcomes of using big data include better targeting of marketing efforts (41%), optimization of ad spending (37%), and optimization of social media marketing (37%).
- 54% of an organization’s security budget is invested in security plans versus reacting to threats. Dell & TNS Research discovered that midmarket organizations both in North America and Western Europe are relying on security to enable new devices or drive competitive advantage. In North America, taking a more strategic approach to security has increased from 25% in 2014 to 35% today. In Western Europe, the percentage of companies taking a more strategic view of security has increased from 26% in 2014 to 30% this year.
- IT infrastructure costs to support big data initiatives (29%) and costs related to securing the data (28%) are the two greatest barriers to big data adoption. For cloud adoption, costs and security are the two biggest barriers in midmarket organizations as is shown in the graphic below.
- Cloud use by midmarket companies in France increased 12% in the last twelve months, leading all nations in the survey. Of the 11 countries surveyed, France had the greatest increase in cloud adoption within midmarket companies. French businesses increased their adoption of cloud applications and platforms from 70% in 2014 to 82% in 2015.
Sources: Dell Study Reveals Companies Investing in Cloud, Mobility, Security and Big Data Are Growing More Than 50 Percent Faster Than Laggards. October 13, 2015
- U.S. technology hubs (Silicon Valley/San Francisco, New York, Boston, Los Angeles & Chicago), Israel and Canada dominate while confidence continues to fall in Brazil and other emerging markets.
These and other insights are from Deloitte’s 2015 Global Venture Capital Confidence Survey. You can download a copy here (PDF, no opt-in, 70 pp.). Deloitte has also produced and made available infographics of the key findings here (PDF, no opt-in, 4 pp.). Deloitte & Touche LLP and the National Venture Capital Association (NVCA) collaborated on the eleventh annual survey, which was conducted in May & June of this year. The study assesses investor confidence in the global venture capital environment, market factors shaping industries and investments on specific geographies and industry sectors. Please see page 4 of the study for a description of the methodology.
Key take-aways include the following:
- Global venture capital investors are most confident in cloud computing (4.18). Investors were asked to rate their confidence level in each sector. Confidence levels were measured on a scale of 1 to 5, with 5 representing the most confidence. Basis points indicate year-over-year changes. Mobile (4.05), Internet of Things (3.95) and enterprise software (3.82) are the top four sectors venture capitalists are the most confident in today. Biopharmaceuticals are experiencing the greatest increase in venture capital confidence today. Please the the graphic below for additional details.
- The United States (4.17), Israel (3.90) and Canada (3.60) dominate venture capital investors’ confidence while emerging markets including Brazil continues to fall. U.S. technology hubs including Silicon Valley/San Francisco, New York, Boston, Los Angeles and Chicago continue to retain and reinforce global venture capital investor confidence. The following graphic illustrates global venture capital investor’s confidence by nation.
- Silicon Valley/San Francisco (4.28), New York (3.86) and Boston (3.77) are the top three U.S. metros global venture capital investors have the greatest confidence in. Los Angeles (3.43) and Chicago (3.22) are the fourth and fifth most trusted U.S. metros that venture capitalists have confidence in. $15.2B was invested by global venture capital investors in Silicon Valley/San Francisco according to the Deloitte study. The following graphic compares venture capitalist confidence levels and venture capital investment dollars received in 2015 through Q2.
- Immigration reform (61%) and patent demand reform (36%) are the top two initiatives U.S.-based venture capitalists want addressed by policy leaders. For non-U.S. venture capitalists, tax incentives/credits (50%), infrastructure and job creation (both 41%) are the top two initiatives they would like to see public policy leaders take on in their home country.
- Cloud computing continues across all sectors as the area global venture capital investors have the greatest confidence in. Confidence in biopharmaceuticals grew the fastest of any sector measured by the survey between 2014 and 2015, and this is the first year Deloitte is tracking investor confidence in the Internet of Things (IoT). A sector comparison is provided below.
Boston Consulting Group (BCG) recently released their fifth annual technology, media and telecommunications (TMT) value report. The 2013 TMT Value Creators Report: The Great Software Transformation, How to Win as Technology Changes the World (free, opt-in required, 41 pgs).
The five trends that serve as the foundation of this report include the increasing pervasiveness of software, affordable small devices, ubiquitous broadband connectivity, big-data analytics and cloud computing. BCG’s analysis illustrates how the majority of TMT companies that deliver the most value to shareholders are concentrating on the explosive growth of new markets, the rise of software-enabled digital metasystems, and for many, both.
The study is based on an analysis of 191 companies, 76 in the technology industry, 62 from media and 53 from telecom. To review the methodology of this study please see page 28 of the report.
Here are the key takeaways from this years’ BCG TMT Value Creators Report:
- BCG is predicting 1B smartphones will be sold in 2013, the first year their sales will have exceeded those of features phones. By 2018, there will be more than 5B “post-PC” products (tablets & smartphones) in circulation. There are nearly as many mobile connections in the world as people (6.8B) according to the United Nation’s International Telecommunication Union (ITU).
- 27 terabytes of data is generated every second through the creation of video, images social networks, transactional and enterprise-based systems and networks. 90% of the data that is stored today didn’t exist two years ago, and the annual data growth rate in future years is projected to be 40% to 60% over current levels according to BCG’s analysis.
- The ascent of communications speeds is surpassing Moore’s Law as a structural driver of growth. BCG completed the following analysis graphing the progression of microprocessor transition count (Moore’s Law) relative to Internet speed (bps) citing Butter’s Law of Photonics which states that the amount of data coming out of an optical fiber is doubling every nine months. BCG states that these dynamics are democratizing information technology and will lead to the cloud computing industry (software and services) reaching nearly $250B in 2017.
- BCG predicts that India will see a fivefold increase in digitally-influenced spending, ascending from $30B in 2012 to $150B in 2016, among the fastest of all nations globally according to their study. India will also see the value of online purchases increase from $8B in 2012 t5o $50B in 2016.
- 3D printing is forecast to become a $3.1B market by 2016, and will have an economic impact of $550B in 2025, fueling rapid price reductions in 3D printers through 2017. BCG sees 3D printing, connected travel, genomics and smart grid technologies are central to their digital metasystem. The following graphic illustrates the key trends in each of these areas along with research findings from BCG and other sources.
- Only 7% of customers are comfortable with their information being used outside of the purpose for which it was originally gathered.
- BCG reports that mobile infrastructure investments in Europe have fallen 67% from 2004 to 2014. Less than 1% of mobile connections in Europe were 4B as of the end of 2012, compared to 11% in the U.S. and 28% in South Korea. European operators have also been challenged to monetize mobile data as well, as the following figures illustrate.
- Big Data is attracting $19B in funding across five key areas according to BCG’s analysis. These include consumer data and marketing, enterprise data, analytical tools, vertical markets and data platforms. A graphical analysis of these investments is shown below.
Alan Kay’s saying that the best way to predict the future is to create it resonates through the best cloud computing and enterprise software predictions for 2014. Constraints that held start-ups back from delivering sophisticated new apps and services are disappearing fast. The dynamics of one of my favorite books, The Innovator’s Dilemma by Clayton Christensen, are in full force across the cloud and enterprise landscape.
There are many predictions being generated right now and instead of writing yet another set, I’m providing a listing of those that are the most interesting and thought-provoking. They are listed below:
- 10 Cloud Computing Predictions for 2014 – In-depth analysis of ten predictions including how more companies will realize they are really in the software business, private cloud computing having a moment of truth and continued adoption of cloud brokerages. This set of predictions is an interesting read and provides useful insight. I’d just add that as application developers go, so goes an industry, a point Bernard Golden refers to in this post.
- Analytics Eats the World in 2014 – George Mathew of Alteryx is one of the most driven people I’ve ever met about analytics programming and development. He’s very focused on breaking down constraints that hold analysts back from getting more value from their data. His predictions provide insight into how business analysts’ roles are changing based on rapid advances in analytics app development, model development and use.
- Changing Cloud Scapes in 2014 – Jeff Kaplan, Managing Director of THINKstrategies provides ten insightful predictions regarding the continued adoption of cloud computing platforms in the enterprise. His fourth prediction, “Although horizontal cloud solutions will continue to experience significant growth, vertical market solutions aimed at specific industries will grow even more rapidly” is starting to emerge today. The recent success of Veeva Systems supports his prediction and points to next year seeing more vertical market solutions being successfully launched.
- Cloud computing experts forecast the market climate in 2014 – Excellent summary of seven cloud computer experts’ predictions for 2014 including Mark Eisenberg, Roger Jennings, Paul Korzeniowski, David S. Linthicum, Tom Nolle, Dan Sullivan and Mark Szynaka. Highlights include IDC analysts predicting the “Over the 2013 to 2017 forecast period, public IT cloud services will have a compound annual growth rate [CAGR] of 23.5%, five times that of the IT industry as a whole,” and PaaS will lead IaaS and SaaS with a CAGR of 29.7%. What’s useful about these set of predictions is the breadth of expertise reflected in market statistics, market and technology projections and insights shared.
- My One Big Fat Cloud Computing Prediction for 2014 – I have been following the industry analysis, writing and research of Joe McKendrick for years based on the excellent insight he provides. Joe predicts that cloud computing is set to become mainstream computing, period. He cites Cisco’s research showing the majority of data center will be cloud-based and shares his perspective of the market. Joe has an innate sense of how enterprises adopt and use technology and this post reflects that expertise.
- SaaS predictions for 2014 – Chris Kanaracus is predicting that multitenancy will fade away as a major concern in SaaS, geographic depth of coverage will accelerate with cloud vendors announcing new data center openings around the world, and more vertical market adoption of SaaS. He also prefaces his predictions with the Gartner forecast for SaaS (software as a service) quoting their figures of the total market will toping $22 billion through 2015, up from more than $14 billion in 2012.
- Top Predictions about Software Companies in 2014 – In-depth analysis and predictions of which companies are going to be the most interesting to watch in 2014 and predictions regarding the enterprise software landscape. This post provides a great overview of how industry veterans see enterprise software changing as a result of cloud computing as well.
- Troubling, Challenging 2014 ERP Predictions – Brian Sommer’s predictions are the most thought-provoking and honest of any written so far this year. He writes “for an ERP vendor to sell CX (customer experience) software and then mistreat their own customers so badly is more than ironic (or moronic). It’s a death wish. Yet, it happens.” If there is only one set of predictions you read from this list, be sure to read this set.
- What Should CMOs Do In 2014? IDC’s Top Ten Predictions – Gil Press provides in-depth analysis of IDC’s predictions of how the role of CMO will change in 2014. He’s summarized the key points of the recent webinar including market forecasts from IDC, providing his insight and expertise in this post. IDC is predicting that digital marketing investment will exceed 50% of total program budget by 2016, up from 39% in 2013 and that by the end of 2014, 60% of CMOs will have a formal recruiting process for marketers with data skills.