Investment Thesis Map
We mined VMware's acquisitions, investments, and partnerships to discern the company's strategic priorities.
Enterprise technology veteran VMware was founded in 1998 and quickly gained traction with its virtualization solutions, which have enabled companies to improve IT efficiency. In 2021, the company notched $11.8B in revenue, marking 9% YoY growth.
But VMware’s core business — virtualization, or software that simulates computer hardware functionality — faces notable headwinds. Specifically, the adoption of cloud computing, the proliferation of open-source software solutions, and the encroachment of big tech companies (e.g., IBM, Amazon, Microsoft, and Oracle).
In response to these threats, VMware is reinventing itself to compete in high-growth areas like cybersecurity, cloud computing, networking, and modern application development. Since 2018, it has acquired 23 businesses, including cybersecurity company Carbon Black for $2.1B and application development company Pivotal Software for $2.7B.
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Using CB Insights data, we uncovered the 4 most important strategic priorities highlighted by VMware’s recent acquisitions, investments, and partnerships. We then categorized companies by their business relationships with VMware across these priorities.
- Application development
- Cloud computing
- Cybersecurity
- Software-defined networking
