Five stories that will shake the company in 2021 – Gadgets Price - Gadgets Price
Five stories that will shake the company in 2021 – Gadgets Price

There is often a misconception that hedging the business is rather boring compared to the consumer side of the house, but after following the space for a few decades, I can tell you that nothing could be further from the truth.

For starters, there’s a lot of money in the business, like Oracle buying Cerner last week for $28 billion and shaking up healthcare while they were at it, or UiPath going from an obscure startup to $35 billion RPA juggernaut earlier this year, before relapsing a bit after it went public.

There’s intrigue, like when activist investors try to force companies to make moves they wouldn’t normally want to make, and battles for control over governance like we saw at Box this year.

There’s drama, like the three-year battle between the world’s largest enterprise cloud infrastructure companies for the Defense Department’s $10 billion JEDI cloud contract, a procurement process that has encompassed everything from lawsuits to repeated internal reviews to presidential interference.

So you can say a lot about the company… but boring? Absolutely not – and this year was no different. So I decided to close 2021 with a look at five stories that shook the company. It’s hard to narrow down 12 months of news to the five biggest stories, but here are my picks.

The Bezos-Jassy-Selipsky musical chairs at Amazon

Perhaps the biggest news this year was that Jeff Bezos decided to step back as CEO and take on the role of chairman. Now that in itself didn’t have a huge business impact because Amazon is an e-commerce company, which isn’t necessarily under my purview, but then what happened happened.

That day in February, when Bezos made his announcement, he also indicated that he had chosen his replacement, Andy Jassy, ​​CEO of Amazon Web Services. He had helped build Amazon’s cloud infrastructure business into a massive business, with a run rate of $64 billion in the most recent quarter.

It wouldn’t be easy to replace him, but they turned to an old friend when they hired Adam Selipsky, CEO of Tableau, to take over Jassy. Selipsky previously worked at AWS from its inception until 2016, when he left to acquire Tableau. Now his job is to keep the train moving. He has momentum in his favor, but competition is intensifying and it remains to be seen what happens next year under Selipsky’s leadership.

Bret Taylor’s Absolutely Outstanding Week?

One of the other top stories was that Bret Taylor, Salesforce CEO Bret Taylor, got some big jobs in the same week at the end of November, which meant a great week for him. For starters, he was named CEO of Twitter. As if that weren’t enough, he was also named co-CEO at Salesforce, where he’s risen rapidly since his company Quip was acquired in 2016 for $750 million.

While Twitter had its own turmoil with longtime CEO Jack Dorsey stepping down and taking over from Parag Agrawal, the move to co-CEO at the CRM giant was clearly the bigger news from a business perspective. Although The Information reported that Taylor still reports to the company’s co-founder, chairman and co-CEO Marc Benioff, the promotion put Taylor in line to become Benioff’s heir apparent, should Benioff decide to return the same way. act as chairman. Bezos did that earlier this year. Another storyline to consider in 2022 is whether Salesforce is rethinking its desire to buy Twitter, a move it thought it was making in 2016 before walking away.

Box-Starboard Value Proxy Battle

Box repulsed an attempt by activist investor Starboard Value to take over the board, a move that likely would have resulted in the removal of co-founder and CEO Aaron Levie, the sale of the company, or both. It was the culmination of months of drama and it made it a major business storyline for 2021.

Starboard Value, an activist investor, bought a 7.5% stake in the cloud content management company in 2019, which would grow to 8.8%, giving it significant leverage over the business. It was quiet for a while, but last year they decided to make a move and let Box know that they wanted to take over the board, which resulted in a proxy battle.

Along the way, Box responded with a $500 million investment from KKR, further angering Starboard, filing a document with the SEC defending Starboard’s list of board candidates and releasing their earnings report early to give voters a chance to vote on their last. to see results. Coincidentally, the company scored two decent quarters after Starboard’s move and easily won the proxy battle, leaving the status quo for now. What will happen in 2022? As I wrote, it may be time for Box to take some bold steps and use some of KKR’s money to buy some adjacent functionality.

DoD Kills JEDI and Announces New Cloud Initiative

The $10 billion in-progress JEDI cloud contract has been a disaster from the day it was announced in 2018. In those years, I’ve written over 30 articles about it, so when the Pentagon decided to finally end it this year, it was big news.

From the beginning, conventional wisdom said it was Amazon’s contract to win. There were complaints that the RFP was written with Amazon in mind, but in the end it was Microsoft who won the deal. However, Amazon went to court and stated that the previous president had directly interfered with the procurement process because of his personal distaste for Amazon CEO Jeff Bezos, who also owns The Washington Post newspaper. Amazon also argued that it should have won on merit.

Regardless, it managed to convince a judge to put the project on hold in February 2020. It would never reboot, and the DoD decided to go ahead with a new project in July, stating that the technology had changed since 2018 (which is true) and wisely decided to go for a multi-vendor approach with its new initiative, rather than the winner-take-all approach it had pursued with JEDI.

Dell Releases VMware

When Dell bought EMC in 2015 for $67 billion (later changed to $58 billion), it was the largest deal in tech history, and another deadpan story to follow and write over the years. VMware was always the crown jewel of the deal, so corporate reporters like me kept a close eye on what Dell was going to do with it. It was full for a long time, but it was a huge story early in the year when it announced it would divest the company in a $9 billion deal.

It may have seemed a little light given the amount still on the books for the EMC deal. What will happen next year? Can anyone try to acquire VMware now that it is free from Dell? Dell remains a major shareholder and has a lot of debt left over from that EMC deal, so it’s definitely something to watch in 2022.

It’s hard to pick just five, as I inevitably left out some worthy storylines. What would you have included? Leave a comment and let me know.

Leave a Reply

Your email address will not be published.