Enterprise technology giants may buy out cash-poor startups

Despite the seemingly impenetrable nature of many of the enterprise technology sector's highest-grossing organizations, such as Hewlett Packard, IBM and Cisco Systems, each has seen significant value drops in the past year. Much of this market loss is due to newer startups rising up and chipping away at valuable business.
These startups have seen success due to their foundation of cloud computing principles, unlike their industry giant competitors, many of which are still making the switch from on-premise solutions. Even with this increased competition, many of these new companies are cash-poor and taking even harder market hits than IBM or Cisco Systems.
This is why buying out these cash-poor start ups would be an excellent business move in a uncertain market. Not only does acquisition eliminate growing competition, but it can help businesses gain new technologies and methods for their approach to enterprise software. These companies will then be able to meet a broadened range of customer needs and be more firmly established for future growth.
"Even before this correction, we've already been seeing the large-cap incumbent technology companies buy small fast-growing cloud companies because they need that kind of DNA, they need that kind of growth," said Aaron Levie, the chief executive of Box, a seller of internet-based data storage, explained in an interview. "If it gets a little bit more pronounced because of that climate, I would totally not be surprised."
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