1 / 14

Private Equity & the Information Industry & The Google Effect

Private Equity & the Information Industry & The Google Effect. Business & Finance Division SLA Conference 2008 June 18 th 2008. PE, Info Industry, Google Effect. PE Articles for Business Information Alert Explore the relationships of the PE sector and business information

whistler
Download Presentation

Private Equity & the Information Industry & The Google Effect

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Private Equity & the Information Industry & The Google Effect Business & Finance Division SLA Conference 2008 June 18th 2008

  2. PE, Info Industry, Google Effect PE Articles for Business Information Alert • Explore the relationships of the PE sector and business information • As a concept; with the importance/growth of PE investment • Our business as a part of the Media sector • The Google effect • This presentation for B&F at SLA Conference 2008

  3. PE, Info Industry, Google Effect PE Articles for Business Information Alert • 4 articles 2007-2008 • Part 1 – Explains PE • Part 2 – PE investments in BI in Europe • Part 3 - PE investments in BI in North America • Part 4 – PE and the Google Effect • Will be published together later in 2008 as a BIA “Guide to International Business Information” Volume 3 with an extensive bibliography of PE sources & services • Business Information Alert website: http://www.alertpub.com

  4. PE, Info Industry, Google Effect  PE in our own industry 2007 • Cross border deals US/Europe • Deals with library automation companies, eg. Sirsi Dynix purchased by Vista Equity Partners • Bureau van Dijk 2004 & Summer 2007 • Gale purchased as part of Thomson Learning by Apax & OMERS and many more…………

  5. PE, Info Industry, Google Effect Private equity-definitions • PE investment is % stake in the business • PE investment is longer term (than VC) (4 to 7 years) and will often take the company through more than one business cycle • Unlike debt (i.e. bank loans), the equity position in the company usually does not require regular payment • Debt is the traditional way to finance business • PE investors will look for a capital gain and an increase in the value of their shares • This means the company needs to have cash flow available for growth

  6. PE, Info Industry, Google Effect The Google Effect • Since 2004; Google’s IPO • multiplier “effect” of Google • every $1 of spending on the web creates $2-3 of economic activity

  7. PE, Info Industry, Google Effect The Google Effect Other definitions: • Google’s IPO leads to other web based companies generating similar high offering prices and acquisitions • Microsoft & Yahoo • Catalyst for the online economy by creating new business models

  8. PE, Info Industry, Google Effect The Google Effect Other definitions: • Google makes searching the web easier; everyone has greater technical aptitude; more comfortable searching on their own • Expectation and demand that search should be easy • Demands easy access to information • Those that can provide the information needed in the right format will win business

  9. PE, Info Industry, Google Effect The Google Effect Which all leads to • Decline in use of information professionals’ expertise ? • Will quality research techniques still be valued? • Just make do with searches on Google?

  10. PE, Info Industry, Google Effect Media Sector/Publishing Definition = The media industry consists of the advertising, broadcast & cable TV, publishing [which includes print and online databases] and movies & entertainment*. * Media in the United States: Industry Profile, December 2006, Datamonitor, Reference Code: 0072-2104, p. 7-8. 10

  11. PE, Info Industry, Google Effect Media Sector/Publishing • Business information company deals • high barriers to entry, • steady revenue growth, • strong cash flow, • significant mergers and acquisitions activity

  12. PE, Info Industry, Google Effect The Google Effect and Private Equity What consumers expect • Relevant quality content • Easy access to that content because of the “Google Effect” So • Private equity buyers will continue to see value in the media and information sectors • In ways that will probably not be grasped by the open market

  13. PE, Info Industry, Google Effect “Consumers are demanding greater flexibility and control over their content, requesting a greater degree of personalized media and the ability to connect with it at a time and location of their choosing. This personalization of media has led to an increased diversity of content.*” *“You’ve Been Googled”, by Mike Cunningham, Nick Bertolotti, Neil Shelton, Giasone Salati, Simon Baker and Heath P. Terry, Credit Suisse Brokerage report, March 19, 2007, p. 3 Thus the appeal from PE firms in owning the disaggregated content customers might be interested in. 13

  14. PE, Info Industry, Google Effect ANN CULLEN e-mail: acullen@hbs.edu SYLVIA JAMES e mail:da-james@11daymer.freeserve.co.uk

More Related