Don't start a startup with the goal of getting acquired | Hacker News Reader

Don't start a startup with the goal of getting acquired

raymondyxu.com

26 pointsgreenfish616 comments

I imagine most people that get into entrepreneurship do so precisely because they don't want to go work for someone else.

Or they want to get bought out with enough money that they don't have to work for someone else.

one of the things that early founders don't understand about acquisition though is that getting bought out in an acquihire usually precisely involves working for somebody else

For a few months to a year, doing f* all, and then simply leaving.

True, my last startup got acquired and it still has the same CEO and CTO.

I worked for a startup in the late 90's founded by 4 college friends that just wanted to build cool stuff. None of them wanted to actually be CEO so they sorta rotated the job between them every few months while they built. Eventually they needed a dedicated person at the helm to handle CEO things so they hired a guy that was a VP at Microsoft at some point. The company was sold off within 6 months and everyone was gone.

Sometimes entrepreneurs have good intentions and just get fucked over.

It sounds like that was a good outcome, they sold out and got rich? There's definitely a stage that comes where a startup no longer needs founders.

If you want to make money, work in big tech. If you have an insatiable itch to build something (product, business), start a company or startup.

That is certainly true. There is a subtle difference between building a company that becomes attractive to acquirers and building one with the primary goal of being acquired. If the latter drives your decisions, you may optimize for acquisition criteria rather than customer value, which can take you away from PMF.

The middle ground is compelling too. Join someone else's startup, but only if it looks promising.

Small and medium sized businesses can represent an optimal solution once you factor in the influence you can have at this scale.

If you are truly gifted at what you do with technology, the SMB route is the best bet. The extremes of solo and mega corp will wear you down in their own special ways - doing too much and doing too little.

In my experience, I would say don't register your startup until you have MVP. Before that getting acquired is a Fata Morgana. Nobody buys a company that is not proving successful or owning a valuable technology. And even if you set out wanting to be acquired you may end up not wanting to sell if you product is doing well. The better advice is to keep investors to a minimum as long as possible, because they will drain your share value and you may end up with far less money that you worked for.

Thought there would be something interesting here about building for key gaps in a specific market vs innovating and finding long term product market fit.

But all I see are simple made up stats and high school guidance counselor level advice.

You'd be surprised at how many startup founders don't calculate the probabilities of different outcomes and are not at all aware of said high school guidance counselor advice

Hmmm, that's currently the 46th best post on HN right now?

Short sweet and to the point.

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