Living Life on the Edge

Old Ideas Redesigned for Edge and Hybrid Computing


It’s a data grab out there! It feels like everyone in every industry is trying to generate, store and process more data.  Despite the excess of privacy breaches and data mis-handlings this past year, consumers are still more than happy to exchange their interaction data for social media and other services.

Industry after industry is redefining itself using data. Two example sectors make the case. Up to 30% of the world’s data is generated in the healthcare industry alone, and the amount of data generated in healthcare continues to grow at a rapid pace. Healthcare is relying on everything from wearable health monitoring devices to drug management sensors to AI-based local medical image analysis platforms to drive new data and, with it, to bring new revenue-generating insights.  In the traditionally conservative automotive sector, the connected car has really become one giant “edge” computing device.  According to the former CEO of Intel, Brian Krzanich, one autonomous car will use 4,000 GB of data/day.

The explosion of data generation is being driven by the growth of smarter computing devices “at the edge” – or near the customer rather than in the cloud. Edge computing is expected to grow by 30% from 2018 to 2022. With these new local compute devices come two things: an opportunity to collect more data; and an opportunity to develop tools to manage that data locally instead of in the cloud.

The question that prompted me to write this post is – who are the new entrants that are taking the ideas we use to manage data and compute in the cloud and bringing them to the edge.

Peter Levine, of Andreessen Horowitz, is quoted as saying “There’s going to be a symbiotic relationship between the edge and the cloud.” That’s true.  We’re not abandoning cloud computing – although we might be relegating it to our more resource-intensive, but less latency-dependent processing needs.  But now there are opportunities to provide new services for both the edge and this hybrid compute environment.

Here are a few companies I think are tapping into those opportunities.

Edge Computing.png

Machine Learning at the Edge

FogHorn Systems is one company that has built a machine learning solution with a tiny software footprint that can run on smaller compute power, which is more typical of edge computing. This enables advanced data analysis to happen locally instead of having to send everything up to the cloud, a particularly useful feature when you need analysis in real-time.

It wasn’t really that long ago that Google, Amazon and others popularized offering machine learning capabilities in their cloud environments.  How quickly things become passé!  While there are a lot of companies talking about machine learning at the edge, there are still very few that can actually do it well.

Data Silos at the Edge

AtScale actually looks like the opposite of an edge computing company. AtScale’s platform makes it easier to move data from local sources to the cloud, creating a virtual “data lake” that allows the customer to run analysis.

But as I said above, we’re not abandoning the cloud altogether but creating a hybrid of cloud + edge.  Hybrid cloud environments have a data problem. Local compute devices and “micro clouds” create new silos of data. Data silos prevent businesses from drawing full insights from their data.

The question is whether companies like AtScale can expand their solutions to federate data silos from edge computing devices into a unified data lake.

AWS at the Edge

We’ve had “edge devices” for a long time – we used to call them embedded systems and now we call them IoT devices. But in the past, these devices were very limited in what they did. Companies could deploy the devices and then leave them for years to operate without worrying much about updates.

Today’s devices are being asked to do much more, including generating and even processing all this data. As a result, updates are becoming a more frequent requirement – one which the existing infrastructure wasn’t designed to support.

The cloud offered agility to the enterprise.  Companies like Zededa are bringing that agility to edge computing. Zedada’s technology creates an abstraction layer between the hardware and software on the edge, allowing the Zedada platform to deploy services to the edge device in a similar way to services that run in an Amazon Web Server environment in the cloud.  WindRiver’s StarlingX project is also tackling the need for common requirements for virtualizing edge computing servers


These three examples only scratch the surface of the list of learnings from the rise of the cloud that become opportunities in the new world of intelligent, data-generating edge devices.

For example, we also need new customer analytics solutions similar to how Mixpanel, Gainsight, and others currently support cloud solutions.  However, in addition to “customer” analytics, we need “machine” analytics since many of these edge devices serve other machines rather than human users.

And obviously, we need new brands of security software that can handle the distributed nature of these devices and the large number of attack vectors that exist in edge computing compared with cloud computing.  Happily, there is no shortage of companies and conversations thinking about that problem.

Will Smith is quoted as saying “Life is lived on the edge”.  It used to be that data lived in the cloud.  But today, like the rest of life, it too can live at the edge. What other cloud-like solution needs to be redefined for us to fully take advantage of life on the edge?

More Robots, Innovation Conferences, and some IoT startups

Monthly Tech Focus: Robot Apocalypse, Part 2

Last month we talked about how robots were taking over jobs in the Factory of the Future.  But robotics are going well beyond our factories - and with mixed results.

While governments won’t call it that, we’ve had autonomous killer robots for a while - in the form of unmanned combat aerial vehicles. The United Nations continues to discuss and debate the ethics of using UAVs as governments continue to use them.

Back on the ground and in the commercial world, in October, Rethink Robotics, the Boston, Mass.-based maker of collaborative robots, shut down. Rethink, founded in 2008, raised nearly $150 million in funding.  According to The Robot Report and others, Rethink was trying to negotiate an acquisition, which fell through as Rethink ran out of cash - a sober lesson for companies as they “rethink” their own growth and exit strategies.  German automation specialist, The HAHN Group, then swooshed in to buy up Rethink’s patents and IP - likely at pennies on the dollar.

In a similar vein, you may recall that, last year, Google sold Boston Robotics, which it acquired in 2013, to Softbank. News outlets like The Next Web suggested the sale was due to the fact that, despite the stunning feats of the Boston Robotics robots, the company had a hard time building something that people needed to buy.  

But despite these setbacks and broader ethical issues, I’m still betting on robots as being significantly and positively disruptive.

If you haven’t seen the latest on what Boston Robotics is doing under the ownership of Softbank, take a moment to watch the video on this page.

News from Our Friends

Congratulations to Frida Polli, and her team at Pymetrics, an enterprise SaaS company using neuroscience and AI to build a better recruitment platform.  Last month, Pymetrics raised $40 million in Series B funding. Companies using Pymetrics have seen an increase in diversity of hires as well as retention rates.  

Congratulations to VEERUM on their recent funding round as they work to offset overspending of capital project delivery. The VEERUM platform creates an accurate digital layout of projects so problems and plans can be identified before work begins.

Congratulations to Helen Kontozopoulos and her co-founding team for launching ODAIA, a machine learning and analytics company offering solutions to help you predict customer and employee satisfaction and churn.

Do you have news to share with our community? Contact us and let us know.

Learnings from Our Travels this Fall

At this year’s ChIPs Global Summit, I was fortunate to hear pitches from Joylux Founder Colette Courtion, Obsess AR Founder Neha Singh, and GoTogether Founder Kimberly Moore.  We also heard lively discussions from government and industry representatives about how prepared our government is to effectively be able to regulate today’s social media technology behemoths.

This was my first year attending the annual conference for the Association of University and Research Parks.  I talked to university and research park innovators about alternative guidance and assistance they could provide to their startups and alternative paths to startup success.  Just like any portfolio, startups shouldn’t all be treated the same way, and portfolio diversity isn’t just about technology diversity but also about diversity in size, growth rates, and funding strategies.  

Team Tribal friend Ilana Golan, CEO of Golan Ventures, gave an entertaining talk November 15 called About the time I fucked up!  Wishing there was a video I could show you - you’ll have to reach out to Ilana directly to hear more!

Ilana Talk Image.JPG

Segment News - IoT

We are focusing on IoT this week, starting with Sensorup, the team behind one of the key standards to enable interconnectivity among IoT devices. From real-time traffic tracking to water usage, they stitch together local IoT devices and their data.

ShoofTech's veteran leadership team says they will connect data from IoT devices to the cloud using advanced wireless technology. See their Plug and Play pitch here and judge for yourself.

Putting IoT on Ice!  Scorched Ice is creating intelligence skates with its embedded IoT sensors that help athletes and coaches learn to become champions on ice!

Do you have news you want shared?  Let us know.

Factory 4.0, Less Pain with Blockchain, The Driver’s Seat, and more...


Tech News of the Month: The Robot Apocalypse?

The current trend of industrial automation and data analytics is advancing faster than most large industrial corporations are ready for. Called the fourth industrial revolution or "Factory 4.0", it brings everything from AI, to robotics, IOT, and AR/VR, to the industrial floor (whether general managers are ready for it or not).

One company leading the way is China-based phone part maker Changying Precision Technology Company. In a great summary, CB Insights talks about Changying's unmanned factory and describes the areas of the manufacturing process ripe for disruption.

Changying used to require 650 workers to keep the factory running. Now robot arms have cut Changying's human workforce down to just 60 workers.  Read more in this post.

Not to be outdone, Zume Pizza has put into production what it calls the first pizza making robot.



Our Friends’ Funding Successes

 It makes sense.  Congratulations to Melissa KargiannakisSkritswap's CEO, and her team for raising their first round of US $500,000. Skritswap uses machine learning to make complicated content more readable so anyone can truly understand anything, no matter how complex.

Back to the factory floor.  Speaking of Factory 4.0, Canvass Analytics, an AI-based analytics platform helping manufacturers anticipate process inefficiencies, predict equipment failures, and foresee energy usage in real-time, raised $5M this summer.


Tribal Investment News

We're excited to announce that Tribal Investments has made an investment in AIKON.  AIKON is a blockchain platform removing barriers that make it difficult for companies to offer their SAAS service to other businesses and consumers.  SAAS companies can offload identity management and rights management to the AIKON platform and sell across geographies without the challenge of managing different fiat currencies.

Segment News - The Driver’s Seat

Whether you are in the autonomous vehicle market segment or not, it's a segment worth paying attention to because it's going to change the world...unless it doesn't.  Will one of these newly funded companies be part of the change?

Three million is a magic number.  WaveSense, Fleetonomy and Perceptive Automata, each raised $3 million for their self-driving vehicle solutions.

  • WaveSense is a Massachusetts-based company offering ground penetrating radar to map subsurface landscapes to help autonomous vehicles to navigate.

  • Fleetonomy hails from Israel and offers AI-based fleet management solutions.

  • Perceptive Automata, another Massachusetts startup, builds software that teaches autonomous vehicles to watch humans as other humans would.

Lifting off beyond the magic number. SkyX, builds vertical take off and landing unmanned vehicles for monitoring and inspecting over long distances.  They raised $9.5 million in a Series B funding. 


Featured Events

 Webinar: Scale or Sale: Optimizing Your Exit Opportunities
Date & Time: Thursday, October 11, 2018 11:00 am PT
Hosting by: Boast AI and Connections Silicon Valley


Jory Des Jardins will be at
NPR's How I Built This Summit
on Tuesday, October 16
offering her expertise to attendees as one of the Summit's select Mentors



An M&A Love Story in Three Parts – The Final Part!

M&A Love Story Part III.PNG

In our previous posts, we’ve talked about

Today we cover Tying the Knot! - the final part of our 3-part series called "An M&A Love Story".

Part III - Tying the knot!

You have a signed term sheet from an acquiring company in your hands.  The hard part is over!

Well, not exactly. This last stage of closing an acquisition requires some heavy lifting, and you want to complete it quickly.  As the saying goes, time kills all deals.

Target to close within 4 – 6 weeks of signing your term sheet.  The longer it takes, the more likely something will come up to kill your deal.  Here are some things we’ve seen come up:

  • your “sponsor” leaves or is reassigned and corporate decides not to move forward
  • the buyer’s business takes a dip and all acquisitions are put on hold
  • you lose a key client and the buyer walks
  • a competitor swoops in and agrees to be acquired on better terms
  • the broader economic environment takes a nose dive and everyone gets jittery
  • your sponsor just changes her mind!

You can’t control everything.  But there are some things you can do to keep the deal moving.

Get your data room ready

The data room is a document repository that the acquiring company will review as it conducts its diligence of your company and operations.

If you’ve followed our three-part M& process, then your buyer will already know a lot about you. But due diligence of a private company goes way beyond what is normally disclosed before a term sheet.  Your buyer will go through a deep discovery process to understand your business from multiple perspectives: commercial, technical, financial, IP related, legal, people and more. This helps the buyer validate its strategy, justify the valuation and start to build an integration plan.

Many sellers wait for the buyer to ask for documents.  Don’t be that seller.  Collect and organize your diligence documents while you are negotiating your term sheet so that you don’t waste any time once that term sheet is signed.

Don’t know what documents you need to collect?  Ask your M&A lawyer and advisor.

Get your financials in order

Buyers want to see standard financial statements by quarter going back at least 3 years.  This seems obvious to most.  And yet, we’ve seen many startups that do not have adequate financial statements for their businesses.

In addition to historical statements, a buyer will also want to construct a financial projection of your business.  Don’t let them do this alone!

Guide the buyer’s thinking by preparing your own 3-5 year projections on a stand-alone and pro-forma basis covering the top-line revenue, bookings, expenses and cash flow.  Expect experienced buyers to go deep into these projections and challenge your assumptions. Make your projections reasonable - you will surely see them after the deal closes!

Beginning to clean up your financials after you sign a term sheet is not only going to delay closing and give an acquirer some serious doubts about your financial acumen, but it can also blow up your acquisition costs with emergency accounting fees.

And while we’re talking about acquisition costs…

You might be tempted to choose the cheapest lawyer to run your deal.  Legal fees for private company acquisitions can run as high as a few hundred thousand dollars. But the value of getting a lawyer with M&A experience on deals in your industry and geography will far outweigh the problems that arise from using inexperienced counsel.

Having said that, once you pick the right lawyer, you can do a number of things to manage those legal costs.

  • Run point on as much of the due diligence process as you can.
  • If the lawyers get stuck on an issue, work with your counterpart to make a business call.
  • Keep the bigger picture in mind.  When you’re neck deep in legal details, it’s hard to remember the forest for all the pine needles being thrown back and forth.

As your company’s chief executive, you still have a business to run. It’s hard to keep up with each and every detail of the acquisition negotiations.  If you don’t do it yourself, and you don’t have a trusted representative doing that for you, you’ll find that it’s even harder to jump back in if you’re needed to solve a dispute before it blows up your deal.

Don’t underestimate the volume of legal docs!

We’ve emphasized that this stage of the M&A process involves more work than most acquisition newbies can imagine.  For a sense of just some of documents that need to be generated, take a look at this post from the M&A Lawyer Blog.

© Can Stock Photo / fotodesign_jegg

© Can Stock Photo / fotodesign_jegg

What you can do now (that will help you later)

 You can immediately start doing a few things that will help you have a faster and less painful experience during the actual acquisition process.

  • Keep your corporate documents updated and in a single place - include incorporation and organization documents, cap tables, investor agreements, option agreements.
  • Watch out for change of control clauses in your agreements with vendors and customers. They will play a large role when you sell your company since that is a change of control!
  • Keep your IP related documents, patent filings, licensing agreements, open source agreements organized and up to date.
  • Get a sample due diligence list and set up an document repository that you keep updated as your business grows.

While closing an acquisition isn’t exactly like planning a wedding, it has some of the same characteristics.  You learn a lot about your “new family” during the engagement process – some of the things you learn may surprise you.  There are a ton of details to navigate – and the longer the engagement goes on, the higher likelihood the wedding won’t happen. 

Perhaps M&A Advisors are a bit like wedding planners.  We’re know where things could go wrong and negotiate around those pitfalls, we attend to the details that you don’t have time to deal with and recommend the best course of action for the decisions you need to make yourself.  And when emotions run high, we’ve learned how to bring them down and focus on the value that brought you both together in the first place. Our goal is to help you tie that knot and live happily ever after…

Mona Sabet and Sandeep Mehndiratta




M&A Love Story Part I.PNG

Last week, we covered Part II of our three-part series “An M&A Love Story”. Today we go back to the beginning to talk about how to start the M&A story. 

If you’re a private company thinking an acquisition might be in your future, our experience is that you jump directly into Part II of the process - what we call “Getting Engaged”. 

But the most important step you can take towards a successful acquisition is strategically “Playing the Field”.  This is what we are covering today.


Part I - Playing the Field

Building a long-lasting & rewarding relationship is equal parts: knowing your prospects; putting yourself out there positively; perseverance in finding the right partner; and timing.

If you are a larger business with substantial revenues and a strong growth trajectory that is meaningful for potential buyers, then you’ll probably engage a traditional investment banker to help you sell.  The banker will follow a standard process:

  • building a new financial model to position you for a sale
  • developing a list of prospective buyers
  • preparing a teaser and a full confidential information memorandum (CIM)
  • blasting the teaser out to the prospect list
  • following up with potential buyers to move the conversation to the next step.

This process has its place.  But it’s not for everyone all the time.  To maximize your exit, you should be working with prospective buyers long before you are ready to sell your company.  This is especially true if you’re a smaller company and your revenues aren’t going to be driving the buying decision.

First, develop your own prospect buyer list

Think about the different industry segments that your business could be a strategic fit for.  Normally, you should target at least 3 different industry segments with a range of players in each segment. 

Going through this exercise – what we call landscaping – early enough in your acquisition planning might open your eyes to new opportunities and help refine your business strategy.  Perhaps you don’t exactly fit with a particular segment today but by adding just a few features to your product or pursuing a few different customers, you can become a better strategic fit.  This is how an acquisition strategy can combine with a business strategy to create additional value for the company.

Second, develop a strategic rationale for your value to a buyer in each segment

This is comparable to creating a teaser, but you’re creating a customized version for each segment.

Don’t make the mistake of getting ahead of yourself here.  If you spend too much time customizing a pitch for each prospect, you’ll likely find all that effort wasted.

The biggest mistake we see companies make in this step is succumbing to the “Sims Effect” – creating an entire world filled with strategies they have created in their mind for their prospective buyers without any real world input.

A buyer isn’t going to adopt your strategy for how they should operate.  They are going to assess whether you fit into their strategy.  So, at this early stage, use your best intel to define how you fit into their strategy – and then test it, just as you would test a beta product with potential customers.

Finally, reach out and start talking to your prospects.

You might be thinking that it’s too early to talk to prospective buyers.  But at this stage you’re not asking them to acquire you (and hopefully you never will!).  Approach these discussions as business development discussions.

In these discussions, you want to introduce your company and impress the prospect with what you’ve been able to achieve.  Focus on positioning what you’ve achieved to fit the strategic rationale you’ve developed for the industry segment your prospect is in.  Test to see if the rationale sits well with your prospect.  If it doesn’t, ask questions so you understand where your theory departs from their actual strategy.

Use the information you learn to reassess the likelihood that this prospect would acquire your company at some point in the future.  It’s better to live in the real world than spend months or more imagining a relationship that isn’t going to happen.  Uncovering this information might also get you thinking about how to modify your business strategy in a way that not only helps your business but also positions you better for a possible acquisition by this prospect.

If successful, these discussions might lead to some partnership opportunities.  Partnerships are great ways for companies to “date” and develop an appreciation of what they bring to the table.  That lays a strong foundation for future acquisition discussions.

If incredibly successful, you might even find that one of your discussions leads to an acquisition conversation.  If so, this could drive a higher valuation and a better fit than any you’d get from a “spray and pray” approach of sending teasers and CIMs.

Of course, these steps take time and resources, both of which every business is in short supply.  This requires you as a leader to make some priority decisions.  Strategically preparing for an acquisition is an activity often put in the important-but-not-urgent category – until it become a fire drill.


Laying the groundwork for a possible future acquisition by “playing the field” is going to help you get a much better valuation down the road.

In next week’s concluding post on the M&A Love Story we will discuss how to close the deal by “Tying the Knot”.


By Mona Sabet and Sandeep Mehndiratta


An M&A Love Story In Three Parts


We get a lot of questions from private companies asking what to expect if they were to get acquired.

The process of getting acquired is a lot like the process of finding a partner and getting married.  While the details are different for each person, the overall process is usually very similar, and often not the fairy tale hook-up we dream about.

If you’re a private company thinking an acquisition might be in your future, this story is for you.

An M&A Love Story in Three Parts

  • Part I – Playing the Field
  • Part II – Getting Engaged
  • Part III – Tying the Knot

Today, we’ll cover Part II – Getting Engaged, even though Playing the Field is the most important step towards a successful acquisition.  Like Star Wars, we’re not afraid of starting in the middle of our story.


Part II – Getting Engaged

This part of the M&A process starts with an Expression of Interest(a là dating) and ends with a signed Term Sheet (a là when your partner says YES). It should feel exhilarating.  But sometimes, it feels more like negotiating a prenup. Let’s find out why.

The “Expression of Interest”

In this phase, your goal is to move the conversation from product demos and partnership discussions to a verbal commitment that the buyer is interested in acquiring your company within a certain price range.

This phase can often be awkward – like trying to find out whether your love interest wants to get engaged before actually popping the question out loud.  It takes strong negotiation skills to guide a discussion towards an actual offer.  If you don’t do it right, you could find yourself in a continuous loop of show and tell with the buyer.

As you work on securing an expression of interest, watch out for these three things:

1.  Come to the discussion with convincing proof points of how you will help their business, rather than how they will help yours.

Companies often spend time showing potential buyers how much more they can sell through the buyer’s channel.  That might be persuasive IF the buyer was already looking for a product like yours to sell to sell through its channel.

If your products are interesting but not something the buyer’s sales team has been clamoring for, then selling more of your product is less interesting to your buyer than selling more of theirproduct.  Can you show them how your business can help them sell more of their product?  Now that’s a killer proof point.

2.  If you have less than 9 months of runway before you run out of cash, don’t pretend everything is going great.

You should balance marketing your company with maintaining your credibility.  In due diligence (discussed in Part III), the buyer will learn nearly everything about your company.  If you overdo your marketing efforts in your “dating phase”, the buyer will eventually figure it out.  It could be enough to break their heart – and your deal.  Since everything will come out in due diligence, you are better off controlling the narrative up front.

3.  If the potential buyer is a competitor, be careful about providing customer or financial data.

You’ll have to tell them your revenue numbers (otherwise they won’t be able to get to an offer) but instead of giving them detailed financials, consider giving them unit business metrics (gross margin ratios, conversion ratios, etc..). Instead of providing customer names (that you haven’t otherwise published), provide data about the % of revenue your top 5 (or 10 or …) customers contribute to total revenue.

Can you get to an expression of interest on your own?  We believe that CEOs shouldn’t try to negotiate their way to an expression of interest themselves.  If you have strong negotiators on your executive team, use them to negotiate with a buyer.  Otherwise, consider hiring an M&A Advisor.  To understand why, see our answer to this Quora post.


The Term Sheet

Once you have an Expression of Interest, you’ll begin negotiating a term sheet. A term sheet is like an outline of your prenup.

A term sheet with minimal terms normally takes a couple of weeks to negotiate.  This kind of term sheet sets out the basic framework of the acquisition including how much the buyer will pay, what they are buying, and how they will pay for it. It will normally also include an exclusivity clause but it will stay away from outlining the more controversial terms of a deal.

However, there are situations where it is in your interest as a seller to have your term sheet cover more controversial terms.  These terms are going to be negotiated eventually and might reduce the actual dollar amount you receive on the closing date.  It’s better to know up front the real numbers you get on closing your deal.  It also puts you in a better position to give your investors a realistic understanding of what they are getting on closing.

If you decide to take on these more controversial terms up front, we’ve seen term sheet negotiations continue for a month or more, so factor this timing into your overall timeline.

Here are the typical set of controversial terms we’re referring to.

  • whether the Buyer will be deducting debt or liabilities of your company from its purchase price;
  • if the purchase price includes shares, and the vesting terms for these shares;
  • if the Buyer expects you to sign a non-compete agreement (normally yes) and if so, for how long;
  • will the Buyer require a minimum number of your employees to sign offer letters before close;
  • will the Buyer require some of the purchase price to be held back (normally yes) in case it determines after closing that some of your representations where inaccurate, and if so, how much of that purchase price do they want to hold back and when will they release it;
  • what else could the Buyer sue you for after closing?

A great explanation of these issues is set out in this post by our legal friends.


This period of negotiating an engagement – from the time you have broached an acquisition discussion with a potential buyer to the time your term sheet is signed – can take two or more months.  Be prepared to put a good amount of effort during that phase, and seriously consider lining up experienced external advisors and legal counsel to make sure you aren’t leaving money on the table.

In next week’s post, we will go back to the beginning of the M&A Love Story and discuss how to find the right partner by “Playing the Field”.


Mona Sabet and Sandeep Mehndiratta


Combining Agile, Design-Thinking and Lean to unlock greater business impact

written by Marion Groh Marquardt and posted on LinkedIn

 CEO Web Croissants | Builder of Cross-Discipline Innovations

Digital transformations, including digitizing business processes, results in increased profits, and an ability to remain competitive and innovative in the face of disruptors. In addition, collaborationinnovation, and customer-empathy are all recognized as fundamental building blocks of effective organizational cultures and effective business.

To see the whole post, click on the button below.