Innovation, Transformation and Impact Through Investments and M&A – 2016 and Beyond
One year ago, I became the new leader for Cisco’s Corporate Development team, leading Cisco’s acquisitions and investment strategy. The corporate development team was already firing on all cylinders, and this last year proved just how impactful we could be. The past 12 months became one of the most active years in Cisco’s history, with 11 acquisitions and over 40 investments.
The single biggest measure of our team’s success is our ability to help Cisco identify market disruptions and capture opportunities that were not possible through other avenues. With investments and M&A, we hold some of the most powerful tools for innovation, but we must continue to transform ourselves, creating new ways of having impact that Cisco will be able to leverage in the years to come.
With this in mind, I set three primary mandates for this team 12 months ago:
- Accelerate impact through M&A,
- Expand the Cisco Investments platform, and
- Attract the best talent to help us continue to be innovative
Accelerate impact through M&A
Acquisitions have always played a significant role in driving Cisco innovation. This year was one of the most acquisitive years in Cisco’s history. We completed 11 acquisitions in the past 12 months, including three acquisitions in three days in October 2015. Some highlights include:
- CloudLock extended our leadership position in cloud security, building on past acquisitions such as OpenDNS
- Acano accelerated the interoperability and scalability of our collaboration infrastructure across cloud and hybrid environments
- Jasper, our most transformational acquisition this past year, catapulted Cisco into a market and thought leadership position in IoT.
Looking ahead, M&A will continue to play a transformational role in accelerating Cisco’s position in our key priority areas.
Expand the Cisco Investments platform
Cisco Investments, Cisco’s corporate venture capital arm, has been funding startups for over two decades, but often is overshadowed by the headlines and impact of our M&A activity. However, it is Cisco Investments that has gone through the most significant transformation recently. We have significantly expanded our investment strategy, we are more agile and entrepreneur focused, we are building out a unique value proposition built around Cisco’s go to market and IT organization, and we are doing all of this on a worldwide basis with exciting opportunities in Europe, Israel, China, India and the rest of Asia Pacific.
This year we chose over 25 portfolio companies to be featured in the Cisco Investments Pavilion at Cisco Live, Cisco’s annual event for over 25,000 of our customers and partners. We also enabled our entrepreneurs to tap into Cisco’s larger start-up ecosystem and venture community relationships, hosting over a dozen engagements and events with entrepreneurs, Cisco IT, Cisco executives including our Chairman, and VC partners.
Over the past 12 months:
- We invested in more than 40 opportunities, including 10 LP positions in funds
- Over 40% of our investments were outside the US
- We’ve grown our theme-based investments; now, approximately 50% of the investments we make are theme-based, focused on next horizon opportunities and future market disruptions, and driven by the corporate development team instead of a Cisco business unit. The remaining 50% of our investments continue to be sponsored by Cisco businesses.
Attract the best talent
This year I added several key senior positions, including a senior leader from our sales organization to build out the development platform for our portfolio companies, a new leader for Asia Pacific with financial expertise from Cisco Capital, and a new leader for IoT, Collab and Apps and Enterprise Networking who was most recently at Comcast Ventures.
Even with all these milestones across M&A, Cisco Investments and talent, we must continue to find new ways to have impact. This year saw a number of new efforts launched including Cisco’s first joint venture in China with our partner Inspur, the public launch of our first wave of Alpha startups including Tetration Analytics and Cloud Defense Orchestrator, and our first EIR cohort in Europe. In addition, we completed our second major divestiture with the sale of our connected devices business to Technicolor. I will be dedicating a future blog to some of these activities.
It is an exciting time at Cisco, with many opportunities in front of us. I don’t believe there is a team in the market that can match our capabilities – the number of deals, the diversity of deals, the complexity of deals – across investments, M&A, joint ventures and divestitures in a strategic advisory + execution role, on a worldwide basis, for over 20 years. Corporate Development and Cisco Investments continues to help chart what this path forward will look like. My team and I are ready for the journey.