PRIVATE AND CONFIDENTIAL TECHNOLOGY FOCUS. BROAD REACH. OPTIMAL RESULTS.
Business Intelligence: Analytics Platforms
Peter Falvey
Managing Director
P. 1.617.598.0437
Jason Myler
Managing Director
P. 1.617.598.0438
Jeffrey Cook
Vice President
P. 1.617.598.0439
2
Overview
Market evolving: Enterprises are moving away from legacy solutions and towards a growing
crop of disruptive vendors (e.g. Tableau, GoodData) addressing a new set of BI needs like
mobile, BigData, cloud and social
BI remains a top priority for IT: Having neglected BI spending over the past few years,
enterprises are refocusing on growth initiatives and upgrading to more robust BI solutions will
remain a key priority for IT spending
- New cloud-based solutions touting ease-of-use will also extend the appeal of BI solutions to
the mid-market, who will play a major role in overall market growth
• Next-gen solutions are being funded: Disruptive vendors that are gaining traction are receiving
significant funding from VCs to take advantage of the opportunity
Legacy players need to catch up: Larger legacy players (SAP, Oracle, IBM, etc.) will look to
acquire more nimble independent vendors in an effort to keep pace with the rapid evolution of the
BI analytics market
The BI analytics market is quickly moving to the “2.0” phase of its lifecycle which we
believe will usher in a wave of investment and consolidation activity
3
Market Evolution
The shift to next-generation BI platforms is underway, displacing many legacy
solutions vendors who are scrambling to catch up to vendors like Tableau
MARKET EVOLUTION
2000 - 2006 2011+
BI 1.0 BI 2.0
2007 - 2011
Rise of BI 1.0 Tools Consolidation Shift to BI 2.0 Tools
BI becomes mainstream and
widely adopted at enterprise level
Industry fragmented, with many
independent vendors of scale
Systems are on-premise and
complex; core functionality
revolves around reporting and
OLAP, some predictive analytics
Widespread consolidation in 2007
- BusinessObjects (SAP)
- Hyperion (Oracle)
- Cognos (IBM)
Many BI 2.0 companies founded
By 2012, many of the legacy
vendors miss targets,
acknowledging a widespread shift
to next-generation solutions
Major demand for next-generation
solutions targeting the business user,
offer predictive analytics, embrace
BigData, cloud and mobile
Numerous anecdotes of enterprises
upgrading legacy systems like SAP
and IBM
Tableau goes public, others receive
funding
Legacy vendors enter rapid
development to play “catch up”
4
Market Size
The BI analytics market is anticipated to grow at 10% annually as BI continues to be a
top spending priority for IT and as legacy solutions are upgraded
MARKET SHARE, TOP 10 VENDORS MARKET SIZE
Source: IDC, Gartner
9.3% CAGR
10.7% CAGR
5
Trends Shaping BI 2.0: Front-End
The end-user of analytics in the enterprise has changed drastically, with businesses
demanding more robust functionality for more users E
RP
CR
M
Un
str
uc
ture
d
SC
M
…
Data Warehouse / Marts
Users
STACK
Rise of Business User: Analytics increasingly used
by business users demanding robust visualization and
presentation tools; increasing use at departmental
level
Self-service: Users are demanding the ability to run
analysis without intervention from IT
Cloud: Organizations, particularly at SMB level, are
looking to cloud-based tools
Mobile: Expectation that analytics can be accessed
via desktop and mobile /tablet
Social: Ability to collaborate now a necessity
Analytics Packages
FRONT-END TRENDS
6
Trends Shaping BI 2.0: Back-End
The explosion of data and advent of the real-time nature of analytics is also forcing
analytics vendors to adapt to a more complex data environment E
RP
CR
M
Un
str
uc
ture
d
SC
M
…
Data Warehouse / Marts
Users
STACK
BigData: Growing adoption of technologies like
Hadoop are driving the ability to use vast amounts of
unstructured data (e.g. website clicks) as a key input
in analysis
Real-time analytics: Technological advancements
such as in-memory databases are enabling real-time,
next-generation capabilities such as predictive
analytics and event processing
Proliferation of data sources: The growing number
of enterprise applications is providing a wealth of data
that complements analysis of legacy data sets
Analytics Packages
BACK-END TRENDS
7
Market Map
Scale based on company funding and revenue, where available
Scale
L
arg
er
Sm
alle
r
Functionality BI 1.0 BI 2.0
<$25M
$25M - $100M
$100M - $500M
$500M+
8
How We See the Market Playing Out
The BI market will undergo a paradigm shift over the next few years as BI 2.0 solutions
gain hold and larger players look to play catch-up
Continued
Acceleration of BI 2.0
Players
Legacy Vendors Will
Maintain a Foothold
Solutions More
Widely Adopted at the
SMB Level
Next Wave of
Consolidation Starts
Legacy players (SAP, Oracle, IBM, etc.) acquire established platforms
and smaller vendors to upgrade platforms
Growing next-generation vendors (TIBCO, Qlik, etc.) acquire rising
technologies to extend their lead
Well-funded, disruptive independent vendors (Tableau, GoodData)
continue to take share from legacy solutions and move up-market
Vendors see use at the departmental level as a complement to
enterprises ‘standard BI infrastructure
Established vendors with existing footprints continue to control the
“plumbing” and basic reporting function of BI
Vendors will look to maintain foothold by upgrading product offering
through both in-house innovation and acquisition
SaaS-based, easy-to-use solutions extend the appeal and value to the
mid-market, who will increasingly drive growth of the overall market
BI 2.0 vendors will control the majority of the share in these markets
given their value proposition
9
M&A Interest Comes from Several Angles
DATA & INFRASTRUCTURE APPLICATION VENDORS
• Vendors controlling the data and infrastructure layer
• Focused on platform acquisitions to move up the technology
stack towards the application layer
• Enterprise application vendors
• Will look to acquire front-end solutions to broaden product
offering; pursue select vertical acquisitions
DIVERSIFIED TECHNOLOGY / FULL-STACK BI PURE-PLAY BI VENDORS
• Diversified technology vendors offering solutions across the BI
stack, from hardware to applications
• Will look to do technology tuck-ins as well as acquire platforms
• Independent BI vendors of scale looking to build BI product
offering across the technology stack
• More focused on tuck-in technology / functionality acquisitions
10
Recent Acquisition Activity
Target Acquirer Date Solution
June 2013 Visual analytics and BI
June 2013 Custom analytics
June 2013 Streaming analytics software
May 2013 Advanced visualization for data
March 2013 BI and analytics software
February 2013 Process automation for BI software
October2012 Big data search and analytics
September 2012 Personalized SaaS BI
August 2012 Big data analytics
June 2012 Metadata management
May 2012 Real-time network data analytics
April 2012 Big data predictive analytics
April 2012 Data management and BI for security
October 2011 Unstructured data and BI for web commerce
September 2011 Data analytics for financial organizations
August 2011 Intelligence analysis for investigations
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Recent Investment Activity
Target Date Amt. / Total Raised Investors
Jul 2013 $4.1M / $5.2M Columbus Nova Technology Ventures, Razor’s Edge, CIT
Jun 2013 $22M / $74M TOTSV Ventures, Adreessen Horowitz, General Catalyst
Jun 2013 $8M / $13.5M Draper Fisher Jurvetson, Atlas Venture
May 2013 $45M / $96.3M Bessemer, Norwest Ventures Partners, ONSET Ventures
May 2013 $12M / $18M Toba Capital, SAP Ventures
May 2013 $6.5M / $7.7M Trinity Ventures, SoftTech VC
May 2013 $254M (IPO) New Enterprise Associates was the seller
Apr 2013 $39M / $86.5M Investor Growth Capital, QuestMark Partners, Intel Capital
Apr 2013 $10M / $23.5M Battery Ventures, Opus Capital, Genesis Partners
Mar 2013 $2.5M / $10.6M Undisclosed
Feb 2013 $1M / $1M (Debt) Intel Capital, JMI Equity, Others
Dec 2012 $9.2M / $12.4M Sequoia Capital, IDG Ventures India
Nov 2012 $20M / $27.2M Battery Ventures, Sutter Hill Ventures, Andreessen Horowitz
Oct 2012 $23M / $60M New Enterprise Associates, Benchmark Capital, Others
Oct 2012 $4.4M / $5.6M TCV Capital, Analytics Ventures
May 2012 $26M / %53.3M Sequoia Capital, Hummer Winblad, DAG Ventures
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Falvey Partners Overview
FOCUS SELECT TRANSACTION EXPERIENCE
December 2011
Has acquired
July 2012
Has been
acquired by
September 2011
Series D
Convertible
Preferred Stock
Led by
September 2012
Has been
acquired by
A portfolio company of
July 2011
Has been acquired
by a portfolio
company of
April 2011
Has been
acquired by
July 2011
Has been
acquired by
February 2011
Growth equity
investment from
July 2011
Has been
acquired by
March 2011
Has divested
its diagnostic
solutions unit
November 2010
Has received an
investment from
A portfolio company of
October 2010
PGI Notify and Send
platforms acquired by
August 2010
Two divisions have been
acquired by a portfolio
company of
April 2010
Has been
acquired by
August 2010
Series C
Convertible
Preferred Stock
Led by
SERVICES
Sell-side or buy-side M&A
Growth capital raising
Board and corporate advisory
SECTOR
Software / SaaS
Tech-enabled business services
IT services
Internet / digital media
COMPANY TYPE
$50M - $250M in enterprise value
Growing, with established scale
Profitable or near-term path to profitability
Falvey Partners is a leading advisory firm serving
mid-market clients across technology sectors
Founded in 2012 by Peter Falvey and key members of the Morgan Keegan / Revolution Partners team
Falvey Partners professionals have closed dozens of software transactions representing billions of
dollars in transaction value