Tuesday, November 18, 2008

Two Strategies You Don't Want in Your Business Plan

  1. We going to take on Intel head-on
  2. Our technology is based on emulation

Novafora to buy once-highflying Transmeta for $256 Million

Transmeta, R.I.P.

Update: The Transmeta Deal: Why? summarizes the head-scratching financial aspect of this deal. Although $256 Million may sound like a lot, it turns out that Transmeta had almost that much cash in the bank! Therefore,

Excluding cash, the company is receiving just over $11 million for its entire portfolio of valuable technology that has been developed over ten years at a cost in excess of $400 million ...

4 comments:

Sean Murphy said...

Damon Runyon observed "the race is not always to the swift nor the fight to the strong, but that's the way to bet."

Some of us are here just to serve as a warning to others.

At some point a new firm will take Intel head on and win. It may not be next year or in the next decade. But it's probably worth it for a VC to place a bet once a decade.

Sandeep said...

Ur wrong - those two are viable ideas in your business plan. Only the company is VmWare (or Redhat).

Transmeta could have used its technology to do a lot of wonders - http://www.itnews.com.au/News/88463,redhat-and-amd-migrate-vms-across-cpus.aspx

Sean Murphy said...

Sandeep: I would be cautious about confusing a cool feature with a profitable business model.

sandeep said...

Sean - my reply is a little more detailed (http://sandeep.wordpress.com/2008/11/21/transmeta-and-the-ipod/)
:)