The Evolution of Cloud Tech

The Evolution of Cloud Tech
19.12.2017 08:29 am

The Evolution of Cloud Tech

Cloud

Cloud has revolutionised the technology sector over the last decade with key proponents acting as major disruptors in a wide range of end markets. Eager to recognise innovative cloud companies for their pioneering work, Clearwater International’s Partner and International Head of TMT Carl Houghton and Director of TMT Emma Rodgers reflect on current trends and what’s driving changes in the cloud market. 

What are the key themes you’ve witnessed this year?

Emma Rodgers: “One of the themes that really stood out to us is the pervasiveness of cloud technology in the UK today. Far from being the new kid on the block, we see cloud software and services really starting to dominate, even in parts of the market which have traditionally been very slow to adopt new technologies.

“In this year’s Cloudex* programme we have seen a much broader spread of technologies and end markets in the applicants which I think really emphasises the shift that we are seeing in the UK market.”

What changes are you seeing within the sector?

Emma Rodgers: “Businesses are looking to differentiate themselves in what can be a highly competitive marketplace. There are a number of companies that we’ve been tracking through our Cloudex index*, that are narrowing their scope as they scale, rather than broadening it in pursuit of that market leading status.

“Rather than simply being software or infrastructure providers which support day-to-day business operations, we are also seeing cloud technology companies inherently changing the nature of the markets they support - unlike many of their predecessors.” 

What is the state of the technology market today?

Carl Houghton: “The press often focus on the negative effects of current politics and the state of the economy - not least the impact of social media on elections, and tax that some of the most profitable global tech companies avoid – but what we see day-to-day in the companies we work with is job creation, export opportunities and business growth, with tech being the fastest growing part of the UK economy as stated in   the latest government reports.

How will Brexit affect the industry?

Carl Houghton: “We’ve been spending time recently with some political due diligence advisers and we’ve been quite encouraged by their views of the limited pitfalls and opportunities they see for tech businesses post Brexit.

“Although there is a tendency to focus on the potential negative impacts of the UK’s exit, there are also a number of market segments which will see opportunities in the change. One great example is supply chain management technology providers, who will be able to provide applications which simplify the new trading regimes we have to contend with.”

What do you look out for in an interesting cloud business?

Emma Rodgers: “I think it’s important to look at how a business impacts the market in which it operates – is it affecting the wider sector?

“It’s also interesting to see how a business utilises its cloud technologies to serve its customer base and importantly how that technology makes for a better experience for that customer base.“

What does the M&A market look like for tech businesses going forward?

Carl Houghton: “Despite the political turmoil, the M&A market remains robust. We’ve advising on more tech deals now than ever and pricing is staying strong.

“Undoubtedly we will hit a point where market sentiment isn’t quite as positive, but for now if you’ve got a great business in tech and are looking to realise or raise capital the market, then we’re finding both strategic and private equity bidders in abundance.”

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