Vodacom's questionable R2 billion valuation of IoT.nxt

[Luis]

Vodacom’s R2 billion blunder

Vodacom’s R2 billion valuation of IoT.nxt when it acquired a 51% stake in the company was questionable, with several experts calling it a blunder.

On 4 May 2019, Vodacom agreed to acquire a 51% stake in IoT.nxt for a maximum consideration of R1.028 billion, of which R469 million was settled in cash.

 

[The_MAC]

IoT.nxt essentially developed a custom system for each new client rather than just plugging their IoT services into a platform.

This, the executive said, should have been picked up during the due diligence phase. It is not clear why Vodacom did not discover the shortcoming.

I have experienced this a few times in my career.

You inherit a system/platform only to find out it cannot scale, is super-bespoke or even has the most ridiculous licensing structure - then you ask yourself, there was most likely a panel of high-paying executives involved in the procurement process and not one of them picked this up, or did and just decided to tow the line.

Then everyone is scratching their heads trying to figure out how to untangle the thing out of your ecosystem or pannel-beat it into submission..