Fascinating article about outsourced developer and software buyout billionaire Joe Liemandthttps://twitter.com/caseyames/status/1218937099413532672 …
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Replying to @Molson_Hart
They stopped buying software companies after Q2 of 2019. Not much info on why.
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Replying to @mgirdley
Hmm. Crazy that they and the other big buyer of software, Robert Smith's firm, are both based in Austin.
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Replying to @Molson_Hart
Very different models between ESW (cigar butt puffs with sweatshop style labor) and Vista (classic pe).
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Replying to @mgirdley
Interesting, didn't know that. This model has definitely become in vogue recently. There's something off to me about Robert Smith though.
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Replying to @Molson_Hart
Definitely (on the model) though building by acquisition seems to always be in vogue. It does seem like folks are finding niches, however.
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Replying to @mgirdley
Molson Hart Retweeted Travis Wiedower
I know of Constellation, but not of any others. Haven't read these yet, but they look good and I've bookmarked them for later reading:https://twitter.com/TravisWiedower/status/1158736781203976192 …
Molson Hart added,
Travis Wiedower @TravisWiedowerI finished reading all the Constellation Software letters – some of the best in the business. Mark Leonard might be the most intellectually honest CEO I’ve come across. I took 11 pages worth of notes! If you’ve ever wanted the SparkNotes version of these letters, here are mine.Show this thread1 reply 0 retweets 1 like -
Replying to @Molson_Hart
Some out there w perpetual hold models: Computer Associates (the granddaddy) Ultimate Software Dura Software (our variation) Tiny Capital ESW and their sub-brands (think3 etc) Others with PE-like strats: Xenon Ventures Scaleworks .. to name a few
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Replying to @mgirdley
I had never heard of Computer Associates before I read the article that spawned this conversation. That's pretty cool. A bunch of companies tried to roll up my space (Amazon e-commerce) and they've been eviscerated by weak returns to scale, Amazon squeeze, and Chinese.
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Replying to @Molson_Hart
Wow. I wish they would have called me first before trying that. When the platform is owned by someone else and they control your margin, it ain't going to end well!
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It's worse than that. You have China to tango with as well. Also, there's an epidemic of Fortune 500 former execs buying these businesses from younger guys with SBA Loans and then within 2-3 years being forced to declare bankruptcy because they're getting eaten alive.
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