Michael Dell: No longer constrained by
short-term minded investors
News |
Christine Horton
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Oct 23, 2013
Michael Dell says as a
private company Dell can be as aggressive as we want to be
Dell founder and CEO Michael Dell this
morning outlined his vision for the future of the company now it is
once again a family-owned company.
Speaking at the Dell Tech Camp in Paris, Dell described how taking the
company back into private hands and no longer answering to
shareholders enabled it to pursue its aspirations as a serious
player in the enterprise.
The capital structure we have now is much more favourable than the
one we had as a public company, he said. Theres greater flexibility
and I feel fortunate to operate this as a private company with much
longer term time horizon and the ability to be as aggressive as we
want to be. We have all the capacity we need. We have two equity
investors who will contribute additional capital as needed; we have
plenty of capital to expand and make acquisitions.
He added: The last four or five years our business has shifted in a
dramatic way. Weve built an entirely new business in the enterprise,
the datacentre, software, services weve more than doubled the size
of that business from $10bn $21bn. Now we want to double it again.
Dell explained how, crucially, the buyout will allow for increased
investment in R&D. In the US theres an affliction of short term
thinkingPublic companies are subjected to what can be characterised
as a 89-day planning cycle where they constantly have to adjust their
plans based on market expectations, he said. We care about three,
five, 10 years from now.
[Were] accelerating the strategy we have around end-to-end
solutions. Our R&D grew by 25 percent last quarter. We filed more
patents this year than last year, which was a record. Were continuing
to build our solutions in software, server, enterprise, the datacentre,
vertical expertise were absolutely building for the long term.
The exec also couldnt resist taking a swipe at rivals HP and IBMs
recent results: Our enterprise business grew nine percent last
quarter. One of our two-letter competitors had a growth of negative
nine percent; one of our three-letter competitors x86 business is
down 18 percent so we believe were gaining share across the
enterprise and the datacentre.
He adds: All of these things are things that as a public company are
harder to dobecause of the demands of these short-term minded
investors.
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