The Google black hole: What happens to startups when they're bought by Google?
slate.com
slate.com
But so far my experience has been very positive. I still have near-absolute control over the development and creative direction of the site.
Why is it surprising that, at least some of the time, they aren't actually interested in the original web site?
I have heard that Google will pay $1m+ per engineer if they like the team and what they've pulled off, even if they are going to dump the technology (or want it rebuilt from the ground up).
I think once you get into eight figures, though-- you're probably right.
1 the technology
2 the product/userbase
3 the employees
4 kill competition
1 & 2 could be 'masterplan' motivations. 3 has a maximum dollar value. 4 is rarely admitted.
It's hard to judge if they messed up without knowing which one it is.
That's not actually true. The thing about giants that acquire startups, is that a) they had the resources to build this thing themselves; b) they didn't.
So ask yourself why didn't they build this thing. It wasn't lack of resources. It wasn't lack of intelligence; they keep tabs on everyone and they go to SXSW too. There were forces that stopped the giant from innovating in this direction. Some of them are technological, but the real issues are usually cultural and political.
Once acquired, the startup is now exposed to all these forces -- with double intensity, since it is an outsider and has few friends in the organization. Unless it's already profitable, has a large userbase, or has big fans among the top execs, it has very little power.
I think these recent articles about how giants "ruin" acquisitions do not take culture and politics into account. The technical issues are not the problem.
They sell for a reason, usually that their funding is running out, founders facing a down round, increasing pressure to become profitable. The fallacy is that the sweetness and light will continue indefinitely.
In the case of MeasureMap, for instance, they knew they wanted that technology integrated into Google Analytics. They may not have been able to answer the "how" part of "who, what, when, where, why, and how", but surely they knew the "who", "what", and "why".
I understand that the startup built the technology and the acquirer didn't. That's the beauty of how this system is set up - a company like Google with piles of cash and stock can has so much money it can buy anything it wants.
Well then how do they decide which startups to buy (MeasureMap, Feedburner, etc.) and which startups to pass on (Digg)? That's the "master plan"..
The same goes for Delicious too I think, they were doing fine, brought by Yahoo, and then went back to being a stealth app while they rewrote everything in C++/PHP. Would they have done that without Yahoo input? Nope, I dont think so...
http://siteanalytics.compete.com/blogger.com+livejournal.com...
I don't see the problem, if you start a startup to make a shitload of money and you do make a shitload of money, then, mission accomplished right? (or, as DHH would say: Profit!)
There will always be companies that get screwed up in the acquisition process, just like there will always be companies that don't. But, let's fuel the rumor that Google kills all that it consumes, why not?
If Google is interested in your application now, why wouldn't someone else snatch it up 6 months later when you have more users for a higher price?
Sometimes winning the buyout lottery is selling yourself short.
This is what managing risk is all about isn't it? You just plain don't know!
But it is a problem for acquirers & by extension a problem for future founders. If acquisitions fail to meet goals, they'll dry up.
What about the user-base? Don't we have a responsibility to them also? Without them we can't be successful, and we should own them some responsibility to ensure that the tools/product/web-site they've been using remains useful for them.
If you have any chance of making it on your own, I'd turn down Google money in an instant after reading this.
Personally, I would evaluate "Google" money based on the numbers.
Founders are supposed to take into consideration their product's role after acquisition when they're talking about getting bought out?
This isn't rocket science - once you sell your company to Google (or whomever), you don't own it anymore. That's why you get all those shiny coins.
Also, there are successes. Writely - > Google Docs seemed to be a pretty big success. I'm sure there are others.
The thing is that we tend to forget the successes a little bit because they got to merge so well with Google. Looking at the list of acquisitions on Wikipedia (http://en.wikipedia.org/wiki/List_of_Google_acquisitions), I can only think about Blogger but I have no experience on if it changed for the best. As far as I can tell, it looks like it's still working fine.
And just to show you that technical issues are not the primary problem, they were using Windows/C# but managed to port to Google's Linux/Java-based infrastructure and login system very quickly. (Granted, C# is way closer to Java than PHP).
I missed where exactly the article said this. I imagine if you're looking at a Google acquisition and you care about your service, nobody is stopping you from asking "how will this integrate into Google's MapReduce/BigTable? Where will I be in the Google corp. structure? Will I get engineers working with me on my product, or will I be farmed off to other products?" Weigh the answers to this as part of yoru consideration about whether this acquisition is good or not.
I think the founders are more to blame for not understanding what an acquisition by Google involved, not whoever@Google they were dealing with for not spoon-feeding them.
Closing your doors to new signups is practically like suicide. As a founder I would never agree to that if I was taking a smaller buyout in exchange for continuing to work on my application as an employee of Goog.
Now if they backed up the money dump truck and sent me on my way I wouldn't care so much (although I'd probably have thousands of users who'd hate me but probably also wouldn't blame me)
I have to ask though, given that most M&A's don't end up working out is google's failure rate really any worse than anyone else's?
Speaking of cool places to work, there is of course Google. But I notice something slightly frightening about Google: zero startups come out of there. In that respect it's a black hole. People seem to like working at Google too much to leave. So if you hope to start a startup one day, the evidence so far suggests you shouldn't work there.
Is Google just a giant Y Combinator?
There are plenty of epic technical achievements within Google. In fact, it's practically expected. The rest of the world just hears about these innovations, on average, three years after they happen. If they ever hear about them.
http://www.google.com/search?q=ex-googlers
I think two founders in our YC class were Googlers.
When things are Google products, there is a certain level of reliability, security, and performance that is expect. Google tries harder than anyone to avoid the Fail Whale.
It takes a long time for large software systems to be ported, security reviewed, integrated, and tested with Google's custom stuff.
From what I have seen, being acquired by Google means that you go dark for 18 months and then emerge as a Google product.
For any other company, habitual 9-10 figure losses would have heads rolling on the floor.