What is the way out? Riverbed has no relevant product line that will bring them back to profitability. They don’t have any strategic product line that would make them an acquisition target. What is the exit plan?
9 replies (most recent on top)
Simply not true. Aternity hit their revised 2020 plan and exceeded their profit targets. ARR was growing >30%, the company was cash-flow positive and profitable. Re-integrating it was the only way to craft a go-forward story for the debt holders, now the owners.
There is a slight difference - one filed for Chapter 11 while the other is still publicly traded.
I remember years ago I thought of Netscout being somewhat of a NPM dinasaur compared to Riverbed. Their whole focus was on trying to milk current customers who had deep enough pockets and the willingness to keep buying from them even though there were more innovative products/technologies out there. No focus on new customers since they didn't have much to offer new customers. Well - Riverbed is now operating the same way. So sad.
The only thing I could think up is to scrap everything and just start over. But the new question would be is what to build? I’ll admit, I haven’t a clue, tech evolved so quickly over the past 5 years and I barely kept up.
RVBD is firmly in the Decline phase of the product life cycle.
- continue to sell to the dinosaurs that rely on our products
- continue down sizing to throw off profitable dollars to creditors and
- throw a hail mary on a pivot to security- which requires expertise and credibility that is not present. Security is a big enough business that there is a non zero, but close to zero, chance something happens.
DS had to have a signature move to keep everyone drinking the kool-aid and Aternity is it. Please convince me otherwise.
How much money did riverbed pi-s away buying Aternity, integrating it, and then spinning it off only to integrate again? That was even more wasteful than the cirrus acquisition. Meanwhile they rewarded the sales teams that played it “safe” and stuck to selling wan op.
Aternity doesn’t help. That co failed. Only a chump would want it back.
Riverbed hasn’t been able to come up with their own marketable product and by reintegrating Aternity it would be selling the same snake oil, but rebranded.
Yup, the US Trustee (the DOJ arm overseeing bankruptcy) has the similar concerns. See Section B.23 of the following doc:
https://cases.stretto.com/public/x164/11683/PLEADINGS/1168311182180000000037.pdf
Aternity wasn’t generating enough revenue on its own and yet it’s being reintegrated. So how does that help?