Some of his bombs: Crescenda Wireless, a developer of software for handheld computers, which dissolved, and Encryptics, a Stamps.com ticket-printing spinoff that went nowhere.

FORBES: Companies & Strategies

Earlier this month, Cisco completed deals for Procket Networks , which sold high-end, high-bandwidth routers and had a solid customer base, and Parc Technologies , a developer of software to streamline network traffic.

FORBES: Cisco Reaches High And Low

For a more dramatic example, consider the following: An investment in Riverbed Technology (RVBD), a developer of software to accelerate application performance and data transmission speeds on WANs, would have generated a 6x return, versus an investment in Clearwire (CLWR), a provider of portable high-speed wireless broadband services, which would have generated a 0.3x return.

FORBES: Software Eating The World: Facts & Figures