Spin-in startups from Cisco
businessinsider.com
businessinsider.com
There's a downside. A skilled PM or engineer in Cisco who gets a product MRD has a choice to make. They can keep their heads down and implement internally, or they can jump ship and start a company knowing that Cisco wants it in the future. To make matters worse: it's not exactly unlikely that Cisco will buy a company to get that product even if you do a good job implementing it internally.
It's not just MPLS that Cisco "spins in". I know people without the MPLS cachet that have done the same thing at Cisco several times.
I keep trying to tell people: If corporate "startup" founders don't have massive upside potential (spelled out in contracts), then it's probably not a "startup." It's just another way for the company to extract more productivity out of salaried employees. Over the long term, equity-starved founders will have to endure insane stress, massive efforts, and other startup "glass chewing".... This will be challenging if founders don't have the potential for a big payoff upon success. For example, this is why VCs are so concerned about ensuring founders have enough skin in the game.
The best engineers figure out pretty quickly that they'll get more interesting work and more money by riding the Cisco-Juniper-Startup-Cisco merry-go-round a couple of times.
At some point "Getting along with others" trumps "Bringing in money" and "Building great things" (or combined, "Building great things that people will pay for") at big companies. The result of this is a bunch of "Well rounded B+ employees". Well rounded B+ employees don't change the world.
For every company that's 20+ years old with 10,000+ employees who does a great job managing top engineering talent, I can point 5 that do it awful. (ok, let's not go through that exercise, but it's the point...)
The best career options for engineers in Cisco are: * sales engineer (not really engineering) * become a manager * jump ship to juniper * go to a startup, maybe even get bought back by Cisco with a career boost * shoot for the moon, stay and maybe become a Cisco Distinguished Engineer, which are like unicorns
Ergo, rank and file engineers are not valued by management, like they are at Facebook/Google/etc.
I think the CEO does set the tone of which types of employees a company values. I recall a quote (I thought was Joel Spolsky or Bill Gates) around why the CEO of a tech company needs to be an engineer. It's basically that only they can understand the important technical details to make big changes in corporate strategies. There's also a component of knowing who to value.
Also, reading between the lines, it means you're a sucker if you don't ride the merry-go-round.
One, Cisco has 101 billion in assets, 48 billion in revenue, 70,000 employees, and acquired over 160 companies. They could pay an engineer whatever the hell the engineer wanted if they wanted to keep 'em.
Two, Cisco's products often include cutting edge or industry leading technology and innovations, partly due to the sheer size and scope of the products and markets serviced under its umbrella. If you want interesting work, it's somewhere in the org, or will be on the next acquisition.
Three, they already do have top talent. See previously mentioned number of employees and companies.
Four, they don't even need talented engineers to create products that will sell. Even college kids with no industry experience can create a successful product if they're determined enough. Their well-oiled machine can deal with not having 'rock stars'.
Five, great engineers work at all sorts of places for all sorts of reasons. You might find amazing work or you might find boring work. But if you want to become rich quick, everyone knows becoming a founder is the quickest way there. If you're not a founder, you're not going to get rich quick. So the math on that one is easy, for people who care about money over all.
Six, as for 'why they do this', my personal theory is they only do this when there isn't a product they already own in a given market and they can't find one to buy.
Seven, a lot of people seem to think that creating a successful product requires home-grown innovation. It doesn't. You don't need to personally have the best engineers, you just need to be able to license their tech. Many companies (even startups) do this.
No, I'm sure the company is very efficiently and rationally operated, but they can do that and still suck at innovation and retaining top engineers.
They could pay an engineer whatever the hell the engineer wanted
They could, but they'd also have to figure out how to let that engineer be productive and overall figure out how to balance research and innovation, and maintaining existing product lines (which is a huge drain in Cisco)
If you want interesting work, it's somewhere in the org, or will be on the next acquisition.
Yes, I worked with an acquisition at Cisco, it was cool, until they vested and almost all left. I got a raise and a better job by leaving too.
Four, they don't even need talented engineers to create products that will sell. Even college kids with no industry experience can create a successful product if they're determined enough.
In my whole time at Cisco, my group was not able to recruit a young "college kids with no industry experience", and not for lack of trying. Cisco was just not offering an attractive environment for junior engineers either.
Their well-oiled machine can deal with not having 'rock stars'.
Then why do they need aquisitions?
Five, great engineers work at all sorts of places for all sorts of reasons.
Some may stay regardless, but Cisco is not giving them the environment to innovate outside of incremental improvements to existing product.
You don't need to personally have the best engineers, you just need to be able to license their tech.
Sure, Cisco could give up market leadership, and just rebrand other peoples stuff, but then they wouldn't be a leading tech company. They would just be a marketing shell.
Even assuming Cisco doesn't want to screw anyone, what's MPLS's best alternative offer if Cisco's offer is too low?
You get to leave all the friction of creating new ideas in a large org behind. The price seems incredibly steep vs just creating a company that is friendly to new ideas (of course creating such a company is no easy task).