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Comment by FirmwareBurner | Hacker News Reader

That' not the complete story. Apple basically screwed Massimo in getting Massimo to spill their guts on their sensor tech promising them an licesing/partnership and instead of following through, they decided to cease any licensing deal and instead poach the team to build that tech inhouse instead of licensing it.

It's known in SV as "brain fucking". A lot of big companies do this to small companies where they promise a acquisition/licensing/funding deal in order to get presentations with confidential info on the core tech, and then just use their massive war chest to build that core tech themselves without compensating the smaller player for having reveal the keys to the kingdom.

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This seems like a huge problem for startups.

Like, the whole point of a startup is (often) to get bought by a big player.

But what if the big players learn all they can from due diligence presentations, then poach your tech and talent, and when you complain, it turns into a drawn-out court battle they win because they can afford $billions in legal fees but you can only afford $10's or $100's of millions?

Is there a counter? If there is no counter, why does VC exist at all? If the counter is "don't spill the beans to big companies looking to buy you out," how does any startup ever get acquired?

I believe the closest counter is a breakup fee. Not a perfect solve, though.

Apple learned the game from Microsoft, who probably learned from someone else. MS was famous for just stealing any technology they wanted.

Where are you getting your information? Doesn’t pass the smell test. Apple does tons of licensing deals—how could you run a vertically integrated company like theirs otherwise? A quick Google search suggests the working environment at Masimo is quite poor, so it makes sense employees might leave.

Read it, don't smell it.

Since most SV startups don't like to patent things (and very few do anything actually patentable), it works. When you run into a case like this, it makes it very hard to say that you didn't infringe their patents.

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