Hacker News Reader

Comment by magicalhippo | Hacker News Reader

Our largest competitor, who had 10x our revenue, got bought about 6 years ago by some huge international behemoth, which of course ran it into the ground over the course of a few years.

Great for us, as we got almost all of their customers.

I recently heard the story of how that happened. The original founders had no intention of selling out, and had signed a deal with the others that unless they were offered a well-defined but ridiculously high price, that the original founders could buy back the shares to take back control.

Well, the multinational company offered the ridiculously high price, and the original founders had no chance to make a higher offer. So they lost "their baby", which is now just a pale shadow of what it once was.

The founders got a lot of money of course, so not a sob story.

View on HN

Had the same story, I joined a startup as the first sales employee. A week later Twitter acquires our competitor, few months later the team dissolves and we are the only other company doing remotely something similar.

It seems like there is a pattern of companies buying other companies and that essentially helps the competitors.

>The founders got a lot of money of course, so not a sob story.

It must be disheartening though, to see something you created get run into the ground.

Am I the only one that would love that situation to be able to start a new thing on easy mode? You know a lot of the failures, you now have a massive network, you have a big wad of cash.

Bust out the idea bin and make something else!

Having a lot of cash is not a good position to start a new product (your pivots will most likely be delayed due to that)

I would not mind facing the arduous challenges of having a lot of cash.

Ok fair enough I'd also definitely have to pass on dealing with that to an accountant but I more mean being able to work on it full time with no financial concern than chucking a milly after each idea

Also to clarify on the seeming heartless I sort of see things as being diluted when others work on them -- in a good way! -- for each person that adds to your thing it goes from mine to our. Long enough and big enough and it's more other people's creativity than yours. Your baby is all grown up and ready to do it's own thing

As a founder who has made a lot of money, I can tell you that founders nearly never put in the same effort that they did into starting their company into something new. Elon Musk is the exception that proves the rule.

Our finance-based culture is very destructive to good companies. Whenever a founder sells a company and leaves, the company almost always goes steeply downhill.

In the same vein as "you can't go home again" (you can go back to the physical location, but you have changed, anybody living there has changed, the buildings have changed etc, to the extent that it's no longer the same thing as your internal conception of "home").. "you can't start from scratch again".

Yeah, they got well compensated as mentioned but if it's something you've put a lot of love and hard work into and you're still burning for, I don't think money can truly compensate.

Obviously it can compensate since they signed something that stipulated it would compensate:

> and had signed a deal with the others that unless they were offered a well-defined but ridiculously high price, that the original founders could buy back the shares to take back control.

Regret is a thing

During the deal, self-rationalization starts to kick-in. The founders probably start believing some of the big-company synergy stories: complementary customer base, already scaled resources, complementary product in the portfolio. "Cross-sale alone will pay for the deal in X months/years." Sometimes they do work out! But all too often, the inertia of the larger business prevents realizing that dream. Yet if the founders weren't good at producing a reality distortion bubble, they quite likely wouldn't have made it to the M&A table in the first place. So such illusions shouldn't be surprising, especially if the price is high.

It's a hell of a lot better than seeing something you created get destroyed and not having the extra zeros in your life. That's the result for most people.

You're talking of course about Bronto and the evil Oracle (well, Netsuite, then Oracle). Everything Oracle touches dies. I lived in Durham, and personally know a lot of the originally employees. They keep pretending like nothing's changed. They absolutely suck now, and we left them.

If I've guessed correctly as to who you are reffering to, that product will go EOL next year.

Is there value in not specifying the company? Unless you have a relationship with the company or the acquiring company, I don't see the reason for the secrecy.

These are small companies in terms of employees, so for me it's a privacy thing.

Yeah some might figure it out, but for me NH isn't Facebook and I'd like to keep it that way.

It's Bronto.

Reply on news.ycombinator.com