Hacker News Reader

That is a failed acquihire. The whole point of an acquihire from the acquirer's point of view is that while business-unit-specific OPEX budget is used for salaries, bonuses and other overhead, retention packages and equity arrangements are generally covered by the central budget. Otherwise you would just hire people directly, possibly using special packages.

What an acquihire gets you, as an executive, is that people you otherwise wouldn't be able to hire, because you can pay above market without wrecking your budget. These people are either vesting out equity or they are on explicit retention packages, but from a budget standpoint _they aren't on you_.

Another way to think about it is that this buys you the time necessary to, using the normal levers available to you, get employees to the point where a set of overlapping RSU grants are vesting quarterly, thereby both avoiding a steep compensation cliff and getting the total compensation to where it needs to be in a way you could not do on day one.

Aren't acquihires really about the IP?

No, they’re soft landings for talented people in failing businesses.

There are very few soft landings in the Kerbal Space Program.

No, then it would be an acquisition.

IP, if it can be re-used, is considered a bonus at best. In practice, the IP you want is in the experience of the people you're getting, not their random patent portfolio or source code.

It’s only failed from the perspective of the acquirer and the employees. The founders made off. Sometimes it can still be considered a gain by the acquirer if it prevents a competitor from acquiring said talent.

> That is a failed acquihire. The whole point of an acquihire from the acquirer's point of view is that while business-unit-specific OPEX budget is used for salaries, bonuses and other overhead, retention packages and equity arrangements are generally covered by the central budget. Otherwise you would just hire people directly, possibly using special packages.

Are you saying the whole point of acquihires is essentially an accounting trick?

> As someone who went through an acqui-hire only to see our founders walk away with millions while the employees' salaries remained unchanged

I have always understood acqui-hire as "Big company sees a team of talented devs with good cost structure (aka: manageable salaries) so they pay a one time flat fee to get that team working on their problems"

At no point have I ever expected developers salaries to change during an aqui-hire. They might get a boost after the aqui-hire if they have trouble retaining the devs for whatever reason. But usually the whole point of an aqui hire is the relative low salaries of the employees compared to their performance.

> compared to their performance

That one part is key. Acqui-hires are justified because the teams display high performance, not low cost. If the truth is that they happen for the second reason, expect a lot of fighting back against it once the word gets out.

> the teams display high performance, not low cost

Performance is relative to cost; you can't have one without the other. Trying to spin it as being only about performance is an attempt to deceive the labor.

If it helps, add "abnormally" before "low" and "high".

As of now, I don't have any certainty that there is any mass deceiving going on. Creating a team with very high performance is not easy, and it makes sense to reward it. But if there is deceiving, it is of one of the worst possible kinds.

And teams is the important bit - not individuals. The whole is greater than the sum of the parts etc.

They might all be top tier workers but there's a benefit to getting a fully functional team with institutional knowledge and processes rather than starting from the ground up.

Frequently acquihires are about opportunity, not cost. I’ve seen acquihires at salaries above what the company would offer to organically recruited employees, because the company is just desperate to recruit. Paying higher salaries can be less costly (once you factor in recruiter salaries, cost of interviews, and opportunity cost of all the time those open positions sit unfilled) than hiring through normal channels.

I guess it’s still fundamentally about cost, but not necessarily first-order costs as you describe.

This would imply that the very event of being in a team that is acqui-hired should communicate that you are more effective than the norm compared to your cost and that you can therefore either negotiate higher pay at the acquiring company or you could bring to status to the table in salary negotiations for a new job.

FWIW, I don't think acqui-hiring is only about getting a team that is relatively cheap for their output. Regular hiring processes are also not cheap and by buying an entire company you can "hire" several devs in one shot (and at a lower risk) where it might otherwise take much more time to find that much extra capacity.

You also get the benefit of hiring several devs that already trust one another and have experience working together without stepping on each other's toes. That's where you can look at the product they have already developed and for what effort, and with some diligence, hire the teams that aren't dysfunctional. Or at least that's the idea.

Exactly. You're not just hiring the individuals, you're hiring the established working relationships they have with each other.

it's also not necessarily low salaries, but also possibly performance density. You can get a team of developers that have had the chaff whittled out under more of a boilerroom condition that the administrative structure of a larger company can't do (harder to get rid of unproductive programmers, e.g.)

One of the most important points (from the acquirer's point of view) is retention.

Most aquihires I know lead to an increase in salary and a retention bonus (a pool was set as part of the aquihire negotiations).

Since payout is tied to % employees who stay on for X years, both sides care deeply to keep them on board

> The game had been set to come out this year [me: March 2020], but the company said last month it was delaying the release until the fall of 2021.

Is delaying the release by over a year and a half a win? I wonder how much in royalties/costs they're really saving.

What infuriates me is that how can you not see that you need another YEAR right up until a few months remain wtf. Why not announce it sooner.

I suspect once you realize the release date is gonna be missed no matter what, you might as well go for a year and uncut all those extra things that were sacrificed in an attempt to make the original reelase date.

One example: you might miss the fact that your company will be torn apart by your dominant business partner.

Also, for a lot of those devs a successful launch of KSP2 is going to be a career booster; they don’t want to walk away from it.

But if they worked for Star Theory they would likely benefit a lot more than if they worked for Take Two directly (I believe the article touches on that).

For sure, but the former is off the table. So they’ve got to decide which is more valuable to them: finishing KSP2, or the extra comp they could get somewhere else.

Guess that depends on your definition of "benefit". As one developer (from the article) puts it:

> he didn’t want to work for a big company where he wouldn’t have the same degree of influence or financial benefits if the game were a hit. “I was at a small studio, where the work I did had a massive impact on our success,”

As a developer, he would never have had a stake in the financial outcome of KSP2's sales.

Didn't he bother to look into the history of the first KSP? The owners made bank (and are still making bank) and many of the developers didn't even make the equivalent of the US minimum wage for their work.

The way I read what he said he seems more interested by having his work matter and influence the final game than immediate monetary reward.

Given what I keep hearing about the working conditions in the videogame industry it seems like most videogame devs are in it because they like making games and want the reward of telling people "see this cool game everybody plays? Well I made (some) of that!". Otherwise with their skillset they'd probably have no trouble finding work in an other branch of the software industry that'd have better compensation and working conditions, if a lot less cool to explain during parties.

I would think that this engineer's ideas of how things were going to change were mistaken. I don't know the insides of this case, but generally, the impact you have on the game you work on depends on three things:

- the trust and empowerment that project leads give non-lead staff

- the amount of non-lead stuff with a voice

- the ability of said leads to have a say in how the project is run

In this case, the leads remained, the project owner (the publisher) remained, and doesn't sound like the staff increased much if at all; so I really doubt things would change much in that sense. Given what happened, someone thought that something in the studio/project had to change, but I just doubt it would be the presence of staff's voice.

shrug It made me completely lose interest in KSP2 almost instantly.

The core fan base of KSP is super passionate and if the game is good they'll play it regardless of the studio name.

Passion can cut more than one way. It’s quite possible that the poster you replied to is, as you said, super passionate and is turned off by Take Two’s hardball tactics to the point that they don’t purchase the game when it’s released.

I enjoy KSP1 and have a bunch of hours in it. But if they Take2 it I'll just skip 2 and keep playing 1.

The last couple years I've gotten real good at passing on games. ex: I thoroughly enjoyed doom 2016 single player, was ambivalent to snap map, and was extremely turned off on the MP. In immortal my understanding is they took all the parts I didn't like from 2016, and built those up (with a healthy dose of being a jerk to the guy who made the bang'n music for 2016 on the side).

I've played doom since doom 1 shareware (pre v1.666) but I'm skipping immortal entirely. There's just way too much content out there for me to bother with people who make me feel bad for doing business with them.

Passion is goodwill.

Goodwill is profits on the table.

With this new studio they are not beholden to prior promises of not having microtransactions.