Not long ago, Harvard Business Review heralded data scientists as the sexiest job of the 21st century – talk about revenge of the nerds! But is this still the case?
The linked report focuses on our sense of m&a values and activities in the Enterprise Data & Analytics sector. It’s our third report focused on this arena. We hope you find it useful. It’s an intriguing world.
With the proliferation of connected devices, widespread adoption of social media, and the ability to accurately interpret unstructured data, businesses are increasingly turning to these data scientists and their advanced analytics to help them understand what happened, why it happened, and – most importantly – what will happen next. These advanced analytics have become a competitive differentiator and drive improved financial results.
Often firms hire internal data scientists who are experts in analyzing big data, but good scientists are not easy to find and are expensive. So, for several years now, many firms have turned to outsourced service providers who have teams of data scientists for hire on a project basis (e.g. Accenture, MuSigma, and Opera Solutions). Market research firm Gartner estimates that the advanced analytics services market amounts to over $16 billion in 2015. It’s a big market, it’s growing, and it’s here to stay. At the same time, there is a new market developing – advanced analytics software.
Much of the activity on the pages that follow is centered on m&a activity in this analytics software market. Gartner estimates that enterprises will spend $1.2 billion on advanced analytics software in 2015. While only a fraction of analytics services spending, this market is forecast to grow much faster than the services market, at an 11% CAGR through 2018. In response, several of the outsourced analytics providers have developed and acquired IP, typically vertically focused. Traditional data scientists are still in high demand, but their programming counterparts may claim the sexiest job award in the coming years as advanced analytics software gains share.
In the past few weeks, advanced analytics firms such as Alteryx, Datamyx, Lucid, and MarketShare Partners (to name just a few) have attracted investments and acquisitions from leaders in data and business intelligence. We still think this space is in the early days of massive growth and expect to see many further investments and acquisitions to come. We follow and sometimes lead m&a in this sector.
If you have questions please feel to contact me or Jeff Trongone – our lead in this area.
–Ken Marlin