What a difference a year makes. After trailing the major indices in 2013, our lower risk PEG-based model portfolio is off to a great start this year. The Rayno Report portfolio of stocks is up 9.1%, or 4.5% if you kept 50% of your portfolio in cash as we modeled at the beginning of the year.

In contrast, the S&P 500 Index is up 1.87% year-to-date (YTD) and the Dow Jones Industrial Average is about flat.

As a reminder, our portflio is based on the premise of finding value, mostly in the form of Growth at a Reasonable Price (GARP), or in valuation terms, a low PEG valuation (price/earnings/growth). Studies show that low-PEG stocks have higher than average returns with lower than average risk.

This entry was posted on Tuesday, April 22, 2014 at 14:44 pm and is filed under Investing.
Keywords: Model Porfolio, Stocks, Qualcomm, Finisar, Skyworks Solutions

Cumulus Networks is emerging as one of hottest Software Defined Networking (SDN) startups with a valuation recently estimated in the $300 million range, according to research by the Rayno Report that will be released next month in our exclusive SDN Startup report. 

The high-profile deal with Dell announced in January was the key driver for Cumulus, with that partnership already producing revenue in some key data-center accounts. That helped catapult Cumulus to the next level and probably gives it the most momentum of any SDN startup.  Cumulus has raised $51 million total and is backed by Andreessen Horowitz, Battery Ventures, Sequoia Capital, and Wing Ventures. 

It's clear that Cumulus, with its model of de-coupling the networking operating system from the hardware, is now perceived as one of the leaders in the SDN startup market, according to a number of sources in the industry, including venture capitalists and executives. I'll be ranking Cumulus among a group of at least 12 companies when when I release my SDN Startup report next month. It will have a price, which has yet to be determined. The free analytics report is still available here

This entry was posted on Thursday, April 17, 2014 at 15:52 pm and is filed under Infrastructure & SDN, Investing.
Keywords: SDN, Cumulus, Dell, Linux, Data Centers, Big Switch

I have been digging into Paul Kapustka's excellent Stadium Tech Report, which gives you the lowdown on how U.S sports stadiums are getting connected via wireless technologies such as DAS and WiFi. Many pro teams are adding hi-tech wireless, social, and analytics platforms. But what struck me as most interesting is that some pro sports teams don't have their own fan-facing WiFi networks at all!

I won't call out the losers. You can learn more about it by downloading the report, which is produced by Kapustka's Mobile Sports Report. But if I were a pro franchise, I'd be kind of embarrassed if I didn't already have a WiFi system in place -- though nearly all of them have a DAS system for improving cellular connectivity. As I've covered here before, pro sports teams are starting to do some interesting things with technologies they can leverage off of WiFi, such as data analytics

This entry was posted on Wednesday, April 16, 2014 at 17:48 pm and is filed under Mobile, Infrastructure & SDN.
Keywords: WiFi, Sports, Oracle, DAS, Analytics, Social Media, NBA

Today AT&T announced it is in "advanced discussions" with the North Carolina Next Generation Network (NCNGN) to bring gigabit-speed fiber connections to communities in that state, potentially accelerating the race to deliver gigabit fiber broadband services to residential communities. 

AT&T said the proposal would bring fiber deployments in the areas of Carrboro, Cary, Chapel Hill, Durham, Raleigh and Winston-Salem in North Carolina, delivering speeds of up to 1 gigabit per second, packaged with AT&T's U-verse integrated voice, video, and data service. 

The move shows that incumbent telecoms aren't going to shy away from competing with Google, which has rolled out gigabit fiber in several communities including Kansas City, Provo, Utah, and Austin, Texas. Silicon Valley. In February, Google announced plans to invite nine more U.S. cities to work with Google on expansion

This entry was posted on Thursday, April 10, 2014 at 21:52 pm and is filed under Infrastructure & SDN, Investing.
Keywords: Gigabit Fiber, AT&T, Google, Adtran, Calix

You can put Barry Eggers, a partner at venture capital (VC) firm Lightspeed Venture Partners, in the bull camp on Software Defined Networking (SDN). He believes it's big. It will shake up the networking and telecom world and will deliver some players along the lines of how VMWare rose to power, following the template for disruption of server virtualization in the data center world.

LSVP, was an investor in Nicira, a startup that was sold to VMware for that nice round number of $1 billion in 2012, setting off the rush in SDN startup craze. [Disclosure: LSVP invested in Light Reading, the company where I was Editorial Director for nearly 10 years.]

Eggers says that LSVP isn't done investing in SDN. They've built one of the widest portfolio of any VC in the space: Avi Networks, Embrane, Nicira (already acquired), and Plexxi. Their latest investment in the space is Avi, which I'm told is focused on Network Function Virtualization (NFV), though Eggers is mum, saying that it's still in stealth mode.

Below is a condensed version of our recent chat, when I asked Eggers questions about SDN and his startup investments.

This entry was posted on Thursday, April 10, 2014 at 13:07 pm and is filed under Infrastructure & SDN, Investing, Interviews.
Keywords: SDN, Venture Capital, Barry Eggers, Lightspeed, Embrane, Nicira, Cisco

Bernard Daines, a pioneering networking enterpreneur who helped expand the Ethernet maket in the 1990s, died today at age 69. 

Daines died at the Kotenai Health and Medical Center in Coeur D'Alene, Idaho, according to the Spokesman-Review (Spokane, Wash.). His brother Dan Daines told the paper he would have been 70 on April 12. 

Daines founded a number of networking companies, including Grand Junction, Packet Engines, and World Wide Packets. Grand Junction was an important acquisition by Cisco Systems when it rolled up a number of Ethernet switching companies in the 1990s to become the networking giant it is today. 

This entry was posted on Thursday, April 03, 2014 at 21:34 pm and is filed under .
Keywords: Bernard Daines, Ethernet, Packet Engines, Grand Junction, Cisco, Alcatel, World Wide Packets, Ciena

In a broad counter-move to the growing momentum behind open networking protocols and a raft of Software Defined Networking (SDN) startups, Cisco today announced its own open protocol, called Opflex, for provisioning and controlling applications on network.

Call this Cisco's Application Centric Infrastructure (ACI) Part II. Late last year, Cisco unveiled ACI, its plan for making its networking gear more software-aware. Today's announcement furthers the vision of how it will plug the new wave of SDN technology into the data center, adding its own new standard was well as interoperability with a range of startups. 

"Cisco is making steps to embrace the idea of software control in the network," says Barry Eggers, a partner at Lightspeed Venture Partners, which has backed a number of networking and SDN-focused companies including Nicira, Embrane, and more recently, Avi Networks. "They are reaching out to an ecosystem that will help them do that. A lot of people say Cisco doesn't get it, but they get the trend. For them it's about how to offer their customers and evolutionary path. There are a bunch of startups that will help them do that."

This entry was posted on Wednesday, April 02, 2014 at 21:28 pm and is filed under .
Keywords: SDN, Cisco, IBM, Microsoft, Nicira, Virtualization

[Editor's Note: This is an abbreviated excerpt of a longer analysis of the subscription music industry which can be found at jonmaples.com]

Subscription music is finally a billion-dollar industry. The IFPI, the trade organization for the worldwide recorded music industry, last week reported that subscription streaming music revenues finally broke the billion dollar mark in 2013. Let’s mark this moment. It’s a huge number for the industry and at long last a confirmation of what many of us who have worked on the streaming side have believed in ever since Rhapsody launched as the first legal service in 2003.

Yet with all the congratulatory backslapping and shaking of hands, dark clouds still threaten to limit what subscription music could become. Why? The secrets are revealed in the data, my friends. You see, subscription streaming might be the same product around the world, but the business results have varied. While perhaps not by design, markets are delivering vastly different revenues and subscribers.

The US market is creating a great deal of revenue, but it hasn’t caught on as a mainstream product. Outside of the US the goal seems much less about revenue -- it’s about bundling the service with other providers. Additionally rightsholders seem to be much more willing to experiment with other models in the rest of the world rather than the good ol’ US of A.

This entry was posted on Wednesday, April 02, 2014 at 15:33 pm and is filed under Digital Media, Investing.
Keywords: Subscription Music, Digital Media, Record Labels, Spotify, Pandora

A stealthy Chinese app developer -- funded entirely by a former American commercial real estate developer -- is expected to file for an $1B IPO in the next few months, seeking to cash into the mobile app craze without selling to Facebook.

The company, TWOconAPP, specializes in "ethereal high-performance secret mobile applications," according to corporate documents. A stealthy investor in the operation, who asked not to be named, says it plans to file through Hong Kong but also file as an ADR on U.S exchanges. Its growth rate may exceed big successes such as WhatsApp, Snapchat, and Instagram, said the source. 

The secret? TWOconAPP is "the most ethereal and secret app ever built," says the investor, a former commercial real-estate developer from Chicago who holes up in Shanghai with new industrial and technology business interests in Malaysia, China and India. He also owns a casino in Macau. The investor, who I knew from the optical networking days when he made big investments in optical high flying IPOs such as Corvis, gave me a call early this morning during Asia business hours to bring me up to date.

This entry was posted on Tuesday, April 01, 2014 at 13:38 pm and is filed under Mobile, Investing.
Keywords: TWOconAPP, Snapchat, China

There is a growing debate of whether or not there is a new tech bubble. Generally that indicates there is a new tech bubble forming.

Of course, sometimes these things take years to play out. The brilliant investor Julian Robertson of Tiger Management famously called the tech bubble of the 1990s -- in 1998. There were still two years to go. Robertson actually shut down his fund because he said he couldn't understand the markets.

The market today is a bit different. There are pockets of extreme froth at the same time there is some value. There are areas we've written about, such as optical technology, which have growth but not super-high prices. The broader market is not approaching the frenzy of 1999. But yet, in some areas, such as cloud computing, data analytics, social media, and biotech, things have gotten very speculative. Connected people behind the scenes -- including CFOs of big tech companies and the people doing M&A -- tell me that the valuations in some of these hot new enterprise technology companies, especially recent IPOs, have gotten too high.

This entry was posted on Friday, March 28, 2014 at 16:10 pm and is filed under Infrastructure & SDN, Digital Media, Investing.
Keywords: cloud services, social media, tech investing, Twitter, Splunk

Mozido Lands $63,472,242 New Funding
  • Company: Mozido
  • Description: Across mobile phones, through point-of-sale terminals, over the Internet – Mozido offers the services your customers need, where they need them.
  • Website: www.mozido.com
  • Type: Venture Equity
  • Amount: $63,472,242
  • Round: Undisclosed
  • Purpose: Proceeds purposes were not disclosed. SEC regulatory filing. The total aggregate amount sold includes Warrants to purchase Series A Preferred Stock granted in the total amount of $13,472,242. Contact technology company for investment details, if applicable. Not an offer or solicitation for sale of securities.
  • Investors:

Sotera Wireless Secures $20,704,787 New Financing
  • Company: Sotera Wireless
  • Description: Our vision is to revolutionize patient safety by enabling the early detection of deterioration in patients who are mobile and free to move about in the hospital or the home. With adequate warning of adverse events, clinicians can intervene more quickly and confidently and patient outcomes can be dramatically improved.
  • Website: www.soterawireless.com
  • Type: Venture Equity
  • Amount: $20,704,787
  • Round: Undisclosed
  • Purpose: Proceeds purposes were not disclosed. SEC regulatory filing. Total Offering amount includes $2,326,180 of securities issued upon conversion of indebtedness and $3,688,179 receivable upon the exercise of warrants to purchase preferred stock that have not been exercised. Contact technology company for investment details, if applicable. Not an offer or solicitation for sale of securities.
  • Investors:

Seva Search Obtains $2,217,205 Series A Round
  • Company: Seva Search
  • Description: Seva Search wants to connect electricians and other services providers with potential customers.
  • Website: www.sevasearch.com
  • Type: Venture Equity
  • Amount: $2,217,205
  • Round: Series A
  • Purpose: Proceeds purposes were not disclosed. SEC regulatory filing. Contact technology company for investment details, if applicable. Not an offer or solicitation for sale of securities.
  • Investors: