Dell: Privatisation Gives Us Freedom To Innovate And Support Startups

Dell says private ownership allows it to innovate and support other businesses and entrepreneurs in a way public companies, subject to reporting periods and the demands of shareholders, are unable to.

Michael Dell re-privatised his eponymous company in 2013, an ownership structure which EMEA President Angous Hegarty says gives the firm freedom to innovate internally, and offer financial assistance where it’s needed.

Saving private Dell

“Innovation often works with longer horizons than public companies like to work with,” he told TechWeekEurope at the company’s innovation day in Copenhagen. “With us, those shackles are gone with the freedom to invest in the medium to longer term. That allows us to accelerate innovation.

“Michael [Dell] is an entrepreneur with Dell, starting the company from a dorm room at the University of Texas. We’ve always fostered and developed that. Over the past three or four years we’ve a renewed focus on creating an entrepreneurial spirit.

“Since we became a private company 18 months ago, we’ve fostered development and enhanced that even more.

“Our owner is our CEO and founder. We make quick decisions and move much faster.”

Support for entrepreneurs

Dell’s own innovation strategy focuses around a number of key areas, including health, security, big data, mobility and IoT, and supports a number of entrepreneurial initiatives around the world. It even has two companies working at its office in Bracknell, where Dell provides space and resources.

Hegarty says Dell is investing billions in new IP, so why support innovation externally?

“We want to be known as a company that is entrepreneurial itself, but a huge proponent of entrepreneurs,” he explained. “Ultimately if tens of thousands of new companies start up over the next 18 months and start to grow, that’s going to create more demand for technologies and solutions.

“That’s good for expansion, jobs and the economy, good for society, but it’s also very, very good for us as a company. Personally, I think it’s just a passion for Michael. He’s been an entrepreneur all his life and continues to be entrepreneurial and wants to support that wider community.”

Financial support

In Eighteen European countries, Dell even offers financial assistance to help companies fund major IT purchases through ‘Dell Financial Services’, a fully regulated venture with a banking licence.

“We’re in a very different time horizon with affordability and return on investment than most other companies,” said Hegarty. “Most technology companies are public companies and look at things with a 90 day horizon. We don’t.

“Dell Financial Services address a business financial challenge: lack of working capital and availability in many European markets.”

Hegarty said it made Dell more flexible in that could invest more in certain regions or sectors and take more risk when it wanted. The facility is also available through Dell’s channel partners.

“At the end of the day, we have set up a number of financial models for an effective business. It’s a business we had done through partnership for some time so we were very familiar with but we decided we needed it to be a core part of our business.”

Windows 10 impact

While IBM sold its PC business to Lenovo a decade ago and HP is spinning its own, along with its printing division, off into ‘HP Inc’, Dell promotes its PC unit as an integral part of the ‘end to end’ solutions it claims are a key differentiator. But despite so much emphasis on services and software within the industry, Hegarty is convinced Dell can still innovate with PCs, especially with Windows 10 around the corner.

“If you look at the form factors, there’s a lot of innovation that’s going to occur,” he said noting the trend of all-in-one PCs and convertible devices. “[Adoption of] Windows 10 later this year will start in the consumer and small business space. A very limited number of commercial companies have moved to Windows 8, so there’s an opportunity [to migrate] from Windows 7 to Windows 10 next year.

“I’ve used Windows 10, it’s a much better experience. We want innovation, we want technology that’s bringing more features, more benefit. Microsoft is a very significant partner and we will have products such as PC’s available from day one. At the launch of Windows 10, you’ll be able to buy Dell technology.

“Competition, whether its Android or Windows is a good thing and that’s why we make our consumer tablets available with either. But Windows is still the significant operating system within the commercial space. As a company, 85 percent of our business is commercial, so a new operating system, new innovations and new features are always beneficial.”

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