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Re:

Ford and Microsoft Led Pivotal’s Expected $253 Million Round in 2016

The 2016 report’s headline and body gave different Pivotal round figures: $235 million versus an expected $253 million. Ford separately announced $182.2 million invested.
From TheFinanceBase Team2 min to read
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The May 2016 report’s headline said $235 million, but its article body described an expected $253 million Series C round led by Ford Motor Company and Microsoft. Ford separately said it invested $182.2 million; that was Ford’s contribution, not the total round. The report said the financing was expected to close that month, subject to regulatory approval, and did not establish that it had closed.

Was the Pivotal round $235 million or $253 million?

The May 10, 2016 Talkin’ Cloud/Data Center Knowledge report contains a mismatch: its headline says $235 million, while its article body says Pivotal expected to close a $253 million Series C round. The body identifies Ford and Microsoft as the lead investors, with existing investors GE, EMC, and VMware also participating. The reported amount to use for the expected round is therefore $253 million, while noting that the headline conflicts with the body.

The report described the financing as expected to close in May and subject to regulatory approval. It does not, by itself, confirm a completed transaction. Pivotal CEO Rob Mee described Ford and Microsoft as strategic partners, saying they would help introduce Pivotal’s cloud and analytics software to more customers.

How much did Ford invest?

Ford announced a separate $182.2 million investment in Pivotal on May 5, 2016, five days before the report about the expected round. That figure comes from Ford’s announcement; it is Ford’s stated investment, not the total Series C amount reported later.

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Ford said the investment was intended to strengthen its software-development capabilities as it moved toward becoming an auto and mobility company. It planned to use Pivotal’s software-development methods, cloud platform, and analytics across IT, product development, and research and advanced engineering. Ford CEO Mark Fields connected the investment to delivering customer experiences and continuing to expand FordPass.

What did Pivotal do, and who owned it?

EMC and VMware formed Pivotal in April 2013. According to Pivotal’s SEC-filed proxy, EMC held a majority of Pivotal’s stock through October 15, 2019. The “EMC’s cloud spinoff” phrasing in the 2016 headline describes the company’s origins and corporate relationship at the time; it should not be read to mean Pivotal remained an independent company.

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Dell completed its acquisition of EMC on September 7, 2016, months after the funding announcement. Dell’s completion announcement included Pivotal among the businesses in Dell Technologies. VMware then completed its acquisition of Pivotal on December 30, 2019. A VMware SEC filing states that Pivotal became a wholly owned VMware subsidiary.

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What else did the 2016 report say?

The report also said Pivotal had recently announced first-quarter 2016 revenue of $83 million, up 56 percent year over year. That revenue figure is attributable here to the report, which is the cited source for it; it should not be treated as independently verified from a primary earnings release.

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Key dates

Date Event
April 2013 EMC and VMware formed Pivotal.
May 5, 2016 Ford announced its $182.2 million investment.
May 10, 2016 A report described an expected $253 million Series C round; its headline said $235 million.
September 7, 2016 Dell completed its acquisition of EMC.
December 30, 2019 VMware completed its acquisition of Pivotal, making it a wholly owned subsidiary.

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