Daily Tech Snippet: Tuesday, June 16

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• Companies - Including IBM and Cloudera - Are Moving On From Big Data Technology Hadoop: There is increasing evidence that Hadoop — one of the most important technologies of the past several years for big data analysis —is not keeping up with the world that created it. On Monday, IBM, which has champion ed Hadoop and put it at the center of its big data strategy, announced it is working on a faster data-processing engine, called Spark. Additionally, a senior executive at Cloudera, probably the largest Hadoop company, said Cloudera is prepared to see key parts of Hadoop diminish in importance, and was increasingly distributing Spark. Hadoop is an open-source architecture that drew heavily on work published by Google in 2004, in particular two different papers on managing, processing and generating very large data sets. Google’s File System and MapReduce, the subjects of the two papers, were based on computing systems that were not organized around drawing a lot of computer memory in a short time; there just hadn’t been that much data before. It did a good job, but it had inherent limitations, since it was adapting one style of computing to another. Spark, by contrast, assumes a world where digital information comes in massive volumes from web browsers, sensors, phones and other things. Does that mean old Hadoop is dead, and with it companies like Cloudera and Hortonworks? Not so fast – they may have been planning for this day. “We’re already the largest distributor of Spark in the world, including Databricks,” said Mike Olson, chief strategy officer at Cloudera. “If MapReduce becomes less important in how people do big data, and it will, we will be there.” Cloudera, he said, has “reset in a smart way, ahead of the others,” by focusing on tools and services for other kinds of analysis besides Hadoop.

• Facebook’s new Moments app is meant to take the pain out of sharing pictures: Facebook on Monday announced a new mobile photo-sharing app that aims to solve a major modern headache: getting the pictures off of everyone's smartphone. The app uses Facebook's face-tagging technology to identify which friends are in your photos so you can sort through the collection by looking for particular people -- "Photos of Joe," for example. You can use Moments to post pictures to Facebook, Instagram and Facebook Messenger, but albums are set to stay between friends by default. Users also choose to sync certain photos to the app -- as can their friends -- so you won't necessarily have to share every photo you took at a particular event with everyone. The app will be available Monday, for iOS and Android devices. Google Photos, which the company announced earlier this month at its developers conference, goes even further than Facebook and lets you search through your pictures not only for faces but also for things such as "sunsets" or "beaches" to easily sift through your photo library. Apple revamped its iPhoto earlier this year to add pictures to the cloud. Flickr also updated its service this spring to make it easier to sort, sync and share your snapshots.

• Chinese Uber Rival Will Raise Funds at $15 Billion Valuation: Two recently merged taxi applications backed by Alibaba and Tencent are seeking to raise funds that value the company at $12 billion to $15 billion. The competing Didi and Kuaidi apps combined in February, and form China’s largest taxi and ride-sharing platforms after merging to limit the rising costs of competing with each other and Uber. Didi Kuaidi still runs separate apps that customers use to access their service, while combining their technology and data. Didi Kuaidi, accounts for 78 percent of ride bookings, while Uber has about 11 percent. Alibaba and Tencent own 10 percent and 13 percent, respectively, in the merged company and Tokyo-based SoftBank also has a stake. The new valuation would make Didi Kuaidi one of the most valuable startups in China after smartphone maker Xiaomi, valued at $45 billion. Meanwhile Uber has told investors it plans to invest $1 billion in China.

• The Growth Equity In Venture Capital: According to data by Dealogic, tech sector IPOs are off to their slowest start since 2009, totaling just $2.35 billion as compared to last year’s total of 62 IPOs valued at approximately $40.8 billion. Companies are now delaying their initial public offerings because they’re able to rely on private investors, such as those in the growth-equity sector, to help fund their next round of capital. Private funding is now filling their capital needs faster and making companies more profitable by raising the valuations. In fact, some companies that might have previously gone public in an effort to raise capital are now becoming acquired before ever hitting the public market. The technology industry is booming, and contrary to popular belief, it’s not just early-stage venture funding that’s steering the ship. Helping to propel this rapid expansion is actually another group of investors that specializes in growing established companies and taking them to the next level, aptly named “growth equity.” In the ecosystem of funding options, growth-equity investors tend to strategically focus on companies with proven technologies and established market adoption — many of which are already generating revenues between $5 million and $100 million. In recent years, growth equity has become its own asset class and is actively followed and monitored by investors. Growth equity enjoys the benefits of investing slightly later down the road in the growth of technology companies, thereby reducing the risk of future financing rounds, while at the same time avoiding the seniority of leverage utilized by private equity firms. The risk-adjusted results of this asset class indicate that better returns can be generated with lower associated risk. Additionally, growth-equity investors tend to be much more hands-on and often occupy seats on the boards of their portfolio companies. This helps to control and lessen the risk associated with investing at this stage. In some instances, growth-equity investors help provide liquidity to founding partners who might have been working for years with little to no return. They also offer the necessary guidance to structure growth-oriented deals that require more complex maneuvers, such as funding mergers and acquisitions.