Lessons learned from Dell-VMware

In 2015, Dell acquired EMC and VMware for a record-setting $67B. In 2021, Dell spun out VMware as an independent company. What lessons were learned? 

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 SHOW NOTES:

• Dell offers $67B for EMC - 2015
• Dell finalizes acquisition of EMC (and VMware) - 2016
• 3 Years Later, Was it Worth the Debt? (TechCrunch)
• Dell’s Public Journey from Private Equity to VMware Share Swap (2018)
• Dell spins out VMware - Dell (2021)
• A New Day for VMware - VMware (2021)
• EMC Revenues (2015-16)
• Dell Revenues (2015-2021)
• VMware Revenues (2015-2021)

 

WHAT WERE THE GOALS OF THE DELL ACQUISITION OF EMC?

Dell was trying to recover from having to go private in 2013. Wanted to consolidate the Enterprise infrastructure market. Wanted to have a one-stop-shop from desktop to enterprise infrastructure to security to applications to hybrid cloud. 

WHAT VALUE DID DELL BRING TO VMWARE?

1. VMware - 26 acquisitions (2016-2021)
2. VMware grew revenues 66% (2016-2021), 11% annually
3. VMW shares grew from $70 to $118 (+68%)
4. Dell grew revenues from $50B to $94B (EMC revenues $25B)
5. VMware on AWS launched in 2016 - grown to around $3B business (26% revenues)
6. Michael Dell gets an A+ for financial engineering
7. Dell/EMC/VMware missed an opportunity to create an alternative to the Big3 cloud providers. 

 

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