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Do you want to be a billionaire?

Would you like billion-dollar-billa billion dollars? Software companies, both startups and established firms, are selling like hotcakes. Some are selling for millions of U.S. dollars. Some are selling for billions. While the bulk of the sales price often goes back to venture financiers, a sale can be sweet for equity-holding employees, and even for non-equity employees who get a bonus. Hurray for stock options!

A million U.S. dollars is a lot of money. A billion dollars is a mind-blowing quantity of money, at least for me. A billion dollars is how much money Sun Microsystems paid to buy MySQL in 2008. Nineteen billion dollars is how much money Facebook is spending to buy the WhatsApp messaging platform in 2014 (see “With social media, it’s about making and spending lots of money”).

I’m going to share some analysis from Berkery Noyes, an investment bank that tracks mergers and acquisitions in the software industry. Here’s info excerpted from their Q1 2014 Software Industry Trends Report:

Software transaction volume declined four percent over the past three months, from 435 to 419. However, this represented a 14 percent increase compared to Q1 2013. Deal value gained 72 percent, from $22.6 billion in Q4 2013 to $38.8 billion in Q1 2014. This rise in aggregate value was attributable in large part to Facebook’s acquisition of Whatsapp [sic], a cross-platform mobile messaging application, for $16 billion. The top ten largest transactions accounted for 61 percent of the industry’s total value in Q1 2014, compared to 55 percent in Q4 2013 and 38 percent Q1 2013.

The Niche Software segment, which consists of software that is targeted to specific vertical markets, underwent a ten percent volume increase in Q1 2014. In terms of growth areas within the segment, deal volume pertaining to the Healthcare IT market increased 31 percent. Meanwhile, the largest Niche Software transaction during Q1 2014 was Thoma Bravo’s acquisition of Travelclick [sic], which provides cloud-based hotel management software, for $930 million.

According to Berkery Noyes, the niche software market was the largest of four segments defined by the bank’s analysts. You can read about the transactions in the business, consumer and infrastructure software segments in their report.

Why would someone acquire a software company? Sometimes it’s because of the customer base or the strength of a brand name. Sometimes it’s to eliminate a competitor. Sometimes it’s to grab intellectual property (like source code or patents). And sometimes it’s to lock up some specific talent. That’s particularly true of very small software companies that are doing innovative work and have rock-star developers.

Those “acqui-hires” are often lucrative for the handful of employees. They get great jobs, hiring bonuses and, if they have equity, a share of the purchase price. But not always. I was distressed to read about an acquisition where, according to one employee, “Amy”:

Under the terms of Google’s offer, Amy’s startup received enough money to pay back its original investors, plus about $10,000 in cash for each employee. Amy’s CEO was hired as a mid-level manager, and her engineering colleagues were given offers from Google that came with $250,000 salaries and significant signing bonuses. She was left jobless, with only $10,000 and a bunch of worthless stock.

The implication in the story, “The Secret Shame of an Unacquired Tech Worker,” is that this is sexist: The four male employees were hired by Google, and the one female employee was not.

We don’t know the real story here, and frankly, we probably never will. Still, stories like this ring true because of the brogrammer culture in Silicon Valley, and in the tech industry.

Let’s end with a bit of good news in that regard. According to market research firm Evans Data Corp.:

The number of females in software development has increased by 87% since first being measured in 2001, according to Evans Data’s recently released Developer Marketing 2014 survey.  In 2014, 19.3% of software developers are women, or approximately three and a half million female software developers worldwide.  While today’s number is strong compared to 2001, it is even stronger compared to the years of 2003 to 2009 when the percent of female developers dipped into the single digit range.

We are making progress.

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Holocaust scrolls and congregational listening

This is one of a series of articles I wrote for the monthly Bulletin of Peninsula Temple Sholom in Burlingame, Calif.

Did you know that we are safeguarding a Holocaust Torah at Peninsula Temple Sholom? You can see the scroll in the Raiskin Torah Center building. It’s in the display case with the yellow Torah cover dedicated in loving memory of Cantor Israel Reich z”l and Helen Raiskin z”l.

The Holocaust scroll is not a “kosher” scroll, fit to be used for a Torah service or reading. That’s because the scroll’s parchment was heavily damaged during the Holocaust era. Rabbi Gerald Raiskin z”l agreed to take the scroll in as a memorial, as a silent witness to that horrific era. (The Hebrew description for a non-kosher Torah scroll is pasul, which roughly means invalid or unfit.)

I was reminded of the Holocaust scroll in January when PTS Executive Director Sandy Silverstein shared with me a letter from the Memorial Scrolls Trust, an organization in London. The letter was dated December 8, 2003 (13 Kislev 5764) and was addressed to Rabbi Raiskin, Rabbi David Wirtschafter, then the associate rabbi, and Gary Pollard, who was synagogue president at the time. Much of the letter was focused on fundraising for the Memorial Scrolls Trust, but it also said:

Since 1973 your congregation has been guardian of Scroll Number 890 from Rakovnik. This is one of the 1564 Czech Torah Scrolls collected by the Nazis from Bohemia and Moravia, which were eventually rescued by Westminster Synagogue and brought from Prague to London in 1964. Each Scroll is a symbol of a people and its indestructible faith, which must surely have been a continuing source of inspiration to your community.

The Czech Torah Scroll arrived at PTS in 1973 — and 2014 is the 50th anniversary of the rescue and distribution of the scrolls. As the Trust explains on its website:

On a wet and windy day in February 1964, the first of two consignments of scrolls arrived at Kent House in London, the home of Westminster Synagogue. They were met by Rabbi Reinhart and a group of his congregants. They were unloaded from the trucks which had crossed Europe from Prague and laid out in the marble entrance hall of the Synagogue, like so many lifeless bodies in the polythene shrouds that had protected them in the Michle Synagogue.

On the second floor of the old Victorian building (the original house had been the home of Queen Victoria’s father), wooden shelves had been erected to receive the scrolls. They were carefully laid out, side by side, with their labels showing. As the labels did not always tally with the original lists, one of the helpers’ first tasks was to re-label them with a new series of numbers which could be entered on to index cards, with any information that could be gleaned about the scroll, its condition, place of origin and any other information available.

The task of examining every one of the 1,564 scrolls could then begin, for each one had to be carefully unrolled, scrutinised and recorded. Some were in appalling condition, burnt, damaged by water or otherwise torn and soiled. Many were too bad to be used again, but many were good enough to merit careful cleaning and restoration. The new life of the Scrolls was about to begin.

The 50th Anniversary was commemorated at a special worship service on February 9 in London. You can watch a seven-minute video from that service at: http://youtu.be/QeXX3Bubr6o

Next Generation of Leadership

April Glatt — a member of the Board of Trustees since 2008 — has been elected as the next president of the congregation. The election took place in the February Board meeting, and her term will begin on July 1, 2014.

Our Board elects incoming presidents each February for a one-year term, and it is usual and customary for a president to serve two back-to-back terms. (There is a two-term limit for the president, and an eight-year term limit for trustees.) Thus, while technically April’s elected term lasts through June 2015, we should expect her to serve as the Board president through June 2016.

April’s work on the Board has been exemplary as chair of a wonderful congregational fundraiser, as membership chair, and for the past two years, as chair of the Board’s Personnel Committee. April is a close advisor, as well as a dear friend. I am incredibly excited about April’s vision for the congregation. Under her leadership, Peninsula Temple Sholom will go from strength to strength. As we say five times each year when we conclude reading one book of the Torah and transition to the next, chazak, chazak v’nitchazek!

Hearing You at the Annual Meeting

Each May, Peninsula Temple Sholom hosts an Annual Meeting, which is your opportunity to hear reports from the Board President and the clergy, as well as see the budget and elect new Trustees to the Board. If you have attended a recent Annual Meeting, you’ll know them to be fairly dry. Lots of reports, lots more reports, and then, well, more reports. PowerPoint! At the Annual Meeting, congregants hear from the leadership, but the leadership does not necessarily hear from the congregation.

This year, we are transforming the Annual Meeting into an Annual Meeting & Conversation. The program will still have reports — but the reports will be fewer and shorter. In the spirit of Kolot, we will add opportunities for everyone to get to know one another better, and to provide meaningful input to the clergy, staff, and lay leadership of the congregation.

The Annual Meeting & Conversation will take place on Wednesday evening, May 21. Please mark your calendar — and please add your voice to the conversation.