So I needed some quick kills, just to get the number of potential investments down to a minimum. I started from the bottom. With Level 3 already out, Gen Probe was next, but after looking arround a bit on Yahoo! Finance I cancelled that idea too. For one, Insider Transactions for Gen Probe were mostly sales and especially the CEO seems to be selling. Institutions hold 90% of the float, meaning that an investment can’t get an upkick from institutions suddenly finding the stock. Without a dividend, which they don’t pay, stock price movements would be the only thing to bank on and based on Analyst estimates the growth won’t be too amazing. Adding to that, that I don’t really know their business, I move on.
Infosys Technologies, the IT outsourcing people, have declining revenue and on top of that, their money is on allowing others to pay less for more. They do better if they can pay people less. Just not something I want to be in.
Monsanto seems to have little growth in them from the analyst estimates, already high institutional investors and negative cash flow. And I don’t fully understand their business. So that one is out too.
That leaves: Genentech, eBay, Vodafone, Flextronics and Interactivecorp. Interactivecorp likely is too puzzeling. I held off with Flextronics for a long time but might have to stop doing that. They just have amazing lock in once they build all this stuff for you. I already do have Vodafone shares and I still do believe in the wireless future. eBay might have a too high P/E for my liking and Genentech looks very promising. We will see.
Monthly Archives: June 2004
Gen Probe and others out
Happy Birthday Jeremy
Today’s birthday greetings go to Jeremy C. Wright from Ensight. Have a great day and a wonderful and successful future! While I am at it, a small plug for
Walking out on Apple
Apple had a lot of announcements today and there is some wonderful stuff coming out of the company as usual. I also still love my iBook. But I have to agree with Russell’s post. This one is about the fact that Apple has seemingly copied Konfabulator. They already did it with Watson (called Sherlock in Apple) too. And the thing is that the Konfabulator copy isn’t really something you’d need in OS X, but it will still push the Konfabulator people out of business. This is not good. They could have bought them if they wanted to. Russell suggests that the developers walk out at tomorrow’s WWDC, which might be a good idea.
I am torn here. I do love that there is so much stuff readily available in OS X, but if I imagine that MS would boundle all this stuff with Windows, they would be right back in court.
Update: Thijs pointed me to this post shedding a little different light on the issue. It’s very well written and gives a good idea on the history of things like widgets, differences in coding between them and a few other interesting insights on other “rip-offs” by Apple.
I do get the point, and I should probably not get as pissed as I did when I started this post. The problem really runs a lot deeper. With development of applications getting easier, development environments improving, the move from idea to finished product gets easier, and it gets easier to rip-off if you want. The question is if you should, especially in the case where it’s a wise decision, for which ever reason. Is it more important to add something like they did now, or is it more important to provide technology to allow others to do that. Then again, that’s really what they did. They made available a system that allows you to build little applications. It’s a good idea really.
Creativity and Perception in Management: Roles
Our personality characteristics also influence the team roles which we are most comfortable iwth. Belbin argued that best working groups are those that have a range of people that can and will fulfil a variety of roles. His inventory, while not formally developed, has proved to useful especially due to validity and understandability of the roles Belbin put forward. But even Belbin recognized that this inventory was never designed as a full test, but more as a guideline
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Creativity and Perception in Management: Values
Here we start at culture, in which national values do have a large effect. These are underpinned by four dimensions (Hofstede): Power-distance, Uncertainty-avoidance, Individualism/collection, Masculinity/feminity. This needs to be kept in mind when going to work in different countries, as these differences can break apart an executive when they want to work like they did in their local country.
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Book Review: Digital Fortress by Dan Brown
Ok, I think I have enough of Dan Brown now. This is the third book I read from him and it has been going downhill. Ok, I started with the newest and most acclaimed one, which explains this a little bit but still, it’s sad. This one is a good book, really nice to read, and I couldn’t put it down, but it is a little bit hard to believe from time to time. He wrote it in 1998 and I think he wasn’t all there yet back then. There is a lot of stuff in there about the NSA and there are some interesting twists in the plot, but it’s just not believable in some situations. Not a must read, but a good one at that.
Level 3 is out
The first item on my calendar of companies to look at was Level 3. Why? Mainly because a friend commented on my Wired Investing post with some info on Level 3:
I’m not convinced of Level 3 at all. Having visited their (totally empty) hosting centers and seeing them disappear as fast as they appeared in the first place doesn’t sit well with me. Their business model might have changed, but I wouldn’t be surprised if their yearly reports still states that the largest amount of the incoming comes from coal mining (not kidding, that’s what they used to do).
They did change their business model and have grown nicely in their new business, with coal mining only coming in at about 80 million USD in revenue, while the total company is now at 3 billion (2003). The problem is, that their discontinuing business (coal mining) is the only one producing a real profit. On top of that, they still have almost 6 billion USD in debt and a market cap of 2.5 billion USD with shareholder equity coming in at 181 Million USD in 2003 and having shrunk (!!!) in the first quarter of 2004.
No matter how I twist the numbers, I do not know how to get this baby profitable. With almost no expenditure on PP&E, amazingly better cash management and out of this world growth, I do not see an amazing value for shareholders, no matter where we stand today. I probably made a mistake somewhere, but one small mistake shouldn’t make the entire idea fall apart. So I am out.
eBay sold on Web services
Everyone knows I truely believe in web services, or rather the idea behind it. Now I just read that eBay [is] sold on Web services and they are expanding their web services offering so more people can dig into their backend and build cool stuff. I love it. This actually is one of the reasons I might be interested in investing in eBay after all. Truely wonderful things can come out of this. Order will build at the edge of chaos and eBay will come out stronger because of it. Wonderful. Now we can build cool stuff interlinking Amazon, eBay, Google, Paypal, … who else? 
Check out the eBay Dev Program for more info.
How to pitch to a VC
So what does a VC want answered, and answered quickly? Check out: Feld Thoughts: The Torturous World of Powerpoint, which includes a wonderful list of questions that a VC wants answered in a simple and easy way. This is actually inspired by the idea that Powerpoint is bad, but I like it that Brad Feld gives you a good idea of what should be in a powerpoint, leaving the reader to adapt this on how best to present the answers. good read and interesting to see what’s on a VC’s mind.
The iPod Slider
The The iPod Slider is a very nicht mockup of a potential new iPod. This thing looks just lovely and watching videos on it would be a blast, even if it’s small.
