7 ms·

Facebook Acquires Drop.io

151 points by whyleym 16y ago

dageroth 16y ago
That's too bad, I always recommended the service for easy collaboration and sharing, was one of my favourites. But well, Facebook will hopefully make good use of the technology and the many channels drop.io had already incorporated to extend it's group collaboration options.
ardit33 16y ago
seems like just a talent acquisition to me
- ryanwaggoner 16y ago
  Zuckerberg has said that all of the acquisitions FB has made are essentially for the talent, not the product.
- seiji 16y ago
  Facebook only does talent acquisitions. Though, I always wondered why drop.io got any attention. Upload thing. Get URL. Share URL? Optional paywall behind URL. Did they have other features?
  - jackowayed 16y ago
    A nice interface. Making it extremely easy to do something simple (but something that the average person can't do without some kind of service) is often all you need. Don't complain about others' successes. Learn from this that a nice interface for something simple is often enough, and go find a market where you can do the same thing, and get rich :) (Note that I've used it to a very limited extent. But even if they have other features, my understanding was that the main value proposition was its simple, pleasant interface.)
    - edash 16y ago
      I was a paying customer and actually found it somewhat difficult to use. When an upload finished, many of my friends / contractors didn't know you'd need to refresh the page to view files. I'd sometimes find two or three copies of the same file in a given drop. My drop had an admin password, but also a manager password (which were different, but would presumably be used by the same person). Even browsing for files to upload was more difficult than it should have been. Once a file was selected some users assumed it was being uploaded already. These were manageable interface problems for me, but required delineated instructions to the "average user."
- erikpukinskis 16y ago
  It's sad that founders do this kind of thing to their users. Why not sell the company to Facebook (with attendant personnel agreements), but sell the assets (users, technical infrastructure) to a competitor at a steep discount, maybe in exchange for shares? That way their users have a fighting chance at a smooth transition, and the technical contribution you made can continue.
  - rguzman 16y ago
    I upvoted you and agree. However, there is also that the shutdown may be driven by facebook for a variety of reasons. As a founder, it is probably really hard to walk away from an offer that is very attractive personally but bad for the service. On the other hand, starting with that mentality is probably bad. c.f. pg's "do something you think is good for the world"
  - codemechanic 16y ago
    I agree. As more and more services close, customers will be wary of putting content online or using a public online service. Thats the reason we started Tonido.
Rantenki 16y ago
Obviously not for their ability to build scalable blogging services (dropio blog site currently down) ;)
waxman 16y ago
Facebook's recent talent acquisitions sort of make sense to me from Facebook's standpoint (good, entrepreneurial talent is hard to find), but I wonder how the founders, employees, users, and investors feel about these relatively odd buyouts. This drop.io deal sounds a lot like the Hot Potato acquisition from a few months ago: in both cases the startups were well-funded, but didn't have much traction, and then Facebook paid 8 figures to essentially buy the main founder (Sam Lessin at drop.io, Justin Schaffer at Hot Potato), and essentially let everything else die (the sites were shut down, the technology scrapped, other employees weren't hired by facebook, etc.) A few questions for HN: - Is Facebook paying too much for these founders? (They're basically shelling out a $10 MM signing bonus that lets these entrepreneurs placate their investors, and then come to Facebook. (Accept the founders only get a fraction of the money, obviously). Is it worth it? What are other new Facebook executives paid in signing bonuses?) - What do the investors think about this? (Are the investors in Hot Potato and Drop.io happy to get a modest return instead of nothing (because these companies hadn't taken off yet), or are they frustrated that these companies ended somewhat abruptly?) - How do the employees feel? (Does it feel like success for them when the whole point of the acquisition is really just to buy their boss? Obviously they get money for their equity, so maybe that trumps any other feelings.) [Full disclosure: I actually work with one of the co-founders of Hot Potato (who didn't go to Facebook), so I know his opinions on this issue, but I'm still curious to hear others' thoughts]. - How do users feel? (Are these buyouts fair to them?) - And lastly, Isn't there a slight paradox with the fact that these founders are being plucked at such high premiums because they're brilliant leaders, and yet, in both the cases of Hot Potato and Drop.io, these startups weren't runaway successes? In other words, doesn't the lack of clear success of these startups undermine the basic premise that the founders deserve $10 MM "signing bonuses"?
- hartror 16y ago
  I doubt the investors are unhappy with an exit, employees and users on the other hand are probably disappointed (though I hope the employees saw something of the exit which probably alleviates disappointment).
- _delirium 16y ago
  As a user it's definitely somewhat disheartening. It seems like whenever something cool/useful comes from a small, previously unknown team, there's a significant chance that it'll just be bought and killed by a big player. Both makes me more wary of relying on such services to begin with (even if they're paid!), and from a progress-of-technology perspective feels unfortunate. I'm sure it's great for the founders, but it's like big companies are using their cash pile to do the opposite of encouraging technological progress: find technological progress elsewhere, buy it, and axe it. Things do occasionally turn out okay, e.g. Google allowed the EtherPad team to open-source the code after Google bought/killed it. And, although I don't personally use/like it, Dodgeball got more or less resurrected as FourSquare after Google bought/killed it.
sabat 16y ago
A replacement for Drop.io is already in the works, I imagine. (And Dropbox won't cut it for a lot of people; it's not as straightforward to do a simple fileshare, and there are other cool features [e.g. RSS] that Dropbox doesn't do.)
- maguay 16y ago
  Dropbox does actually offer an RSS feed with file changes in your public folder.
- prawn 16y ago
  Even Drop.io wasn't particularly straightforward IMO. I would give the URL to clients who needed to get me a batch of files and many would not understand the process without help.
meemo 16y ago
Maybe some should copy their business plan and enter that market niche they occupied (assuming their plan has been successful so far).
- deleted 16y ago
  [deleted]
deleted 16y ago
[deleted]
davidu 16y ago
This was a sale of near last resort. This was not a "win" or an "exit" by any measure.
- johanhil 16y ago
  Did they really burn through their $4.85M from their Series C in 6 months?
  - davidu 16y ago
    If you are burning $500,000/month, which is not unreasonable, then you get 10 months with $5mm. If you haven't turned the corner after 5 months, you know you won't get out of the hole before you run out of cash. Therefore, you sell the company and reduce your burn as much as possible to make a sale happen. If your sale is all about talent and not the technology there is almost no due diligence required and a deal can happen quickly, in about a month.
    - jack7890 16y ago
      It's not unreasonable for drop.io to burn $500k/mo? I run a ten-man startup and I can't fathom burning that much.
      - forsaken 16y ago
        You pay people less than 50k/mo?
        jemfinch 16y ago
        If he doesn't, I'm working for the wrong company.
        deleted 16y ago
        [deleted]
      - teaspoon 16y ago
        Do you host an unlimited number of 100MB files, indefinitely, for an unlimited number of non-paying users?
webnerd 16y ago
Does anyone know the deal price?
smarterchild 16y ago
I always wondered how Drop.io made money. I use it all the time for one time file sharing drops, but they never had anything to sell me.
deleted 16y ago
[deleted]
not_marak 16y ago
1. drop.io is going away 2. Sam Lessin is leaving New York City Sounds like great news to me :-)
MediaSquirrel 16y ago
It took the longest time for me to understand what Drop.io did. And during most of that time I was a NYC entrepreneur. It's hard to build a real company if no one understands what you do. Maybe they would have had a better outcome had they hired a CEO who could create & communicate a cohesive vision. But that's just me.
- tensor 16y ago
  No one that I've suggested drop.io to has ever even heard of it. The response, on the other hand, has been "oh wow! this is cool!" They certainly could have used more marketing as far as I've seen. I'm sad to see them go.
paul9290 16y ago
Congrats to Drop.io. In 2007 I presented my start-up at the New York Tech Meetup (http://www.businessinsider.com/2007/11/nytech-meetup-at-iac http://www.businessinsider.com/2007/11/nytech-meetup-at-iac). It was an odd meetup as only two unknown start-ups presented that evening, mine and a complete unknown, Drop.io who launched at the meetup. Other presenters were established companies presenting new products.
rradu 16y ago
Hm, someone just asked me this week if their data will last on Drop.io--I told them yea for sure, they've been around for a long time, they're not just gonna shut down all of a sudden. And then this.
cavilling_elite 16y ago
My first thought was to take Drop.io and create a Google wave out of it. Now that Rasmussen has defected to Facebook, this may be true(http://techcrunch.com/2010/10/29/rasmussen-facebook-google/ http://techcrunch.com/2010/10/29/rasmussen-facebook-google/)
jkhaff 16y ago
I'd love hearing more drop.io alternative suggestions from others. Dropbox and Tonido have been mentioned, but they really aren't the same thing. My band lives in various areas of the country, and we share mp3 files via drop.io. We're able to comment on each riff/song, link directly to the files, get updates via RSS, and even listen to the mp3s without downloading them. Anything else like this exist?
- sharadgopal 16y ago
  maybe try cloudapp ? http://www.getcloudapp.com/ http://www.getcloudapp.com/
- rahulchaudhary 16y ago
  You can check here, http://alternativeto.net/software/dropio/ http://alternativeto.net/software/dropio/
- Jardenberg 16y ago
  For that specific need you should use http://soundcloud.com http://soundcloud.com
  - jkhaff 16y ago
    Thanks for the suggestions. SoundCloud would be great, except keeping the riffs/music private is important and there's no secret link sharing in the free account (the lite account is €30). Still searching for alternatives... nothing I've seen yet is as good as drop.io for this purpose.
- follower 16y ago
  > Dropbox and Tonido have been mentioned, but they really aren't the same thing. As an aside, an interesting difference with Tonido is they also sell a "plug-in server" for their service too: http://www.tonidoplug.com/ http://www.tonidoplug.com/ I assume it's based on a SheevaPlug / Marvell Plug Computer style device.
- jcn 16y ago
  I'll have to give a plug for my company Indaba Music here - http://indabamusic.com http://indabamusic.com Our site was pretty much designed exactly for this use case - the free account allows for private sessions, in-song commenting and in-session discussion.
_pius 16y ago
Drop.io has very interesting technology; I think it deserved more than a talent acquisition. Their company had a positioning problem. They built a platform that did something very unique (abstracting the coolest features from XMPP into an HTTP/RESTful API) and yet the takeaway for most people is that it's "a file sharing service." Had the Drop.io team done a better job communicating their value proposition to developers with clarity and aggressively positioning their service, I think they could have had a big following.

151 points by whyleym 16y ago

That's too bad, I always recommended the service for easy collaboration and sharing, was one of my favourites. But well, Facebook will hopefully make good use of the technology and the many channels drop.io had already incorporated to extend it's group collaboration options.

ardit33 16y ago

seems like just a talent acquisition to me

ryanwaggoner 16y ago
Zuckerberg has said that all of the acquisitions FB has made are essentially for the talent, not the product.
seiji 16y ago
Facebook only does talent acquisitions. Though, I always wondered why drop.io got any attention. Upload thing. Get URL. Share URL? Optional paywall behind URL. Did they have other features?
- jackowayed 16y ago
  A nice interface. Making it extremely easy to do something simple (but something that the average person can't do without some kind of service) is often all you need. Don't complain about others' successes. Learn from this that a nice interface for something simple is often enough, and go find a market where you can do the same thing, and get rich :) (Note that I've used it to a very limited extent. But even if they have other features, my understanding was that the main value proposition was its simple, pleasant interface.)
  - edash 16y ago
    I was a paying customer and actually found it somewhat difficult to use. When an upload finished, many of my friends / contractors didn't know you'd need to refresh the page to view files. I'd sometimes find two or three copies of the same file in a given drop. My drop had an admin password, but also a manager password (which were different, but would presumably be used by the same person). Even browsing for files to upload was more difficult than it should have been. Once a file was selected some users assumed it was being uploaded already. These were manageable interface problems for me, but required delineated instructions to the "average user."
erikpukinskis 16y ago
It's sad that founders do this kind of thing to their users. Why not sell the company to Facebook (with attendant personnel agreements), but sell the assets (users, technical infrastructure) to a competitor at a steep discount, maybe in exchange for shares? That way their users have a fighting chance at a smooth transition, and the technical contribution you made can continue.
- rguzman 16y ago
  I upvoted you and agree. However, there is also that the shutdown may be driven by facebook for a variety of reasons. As a founder, it is probably really hard to walk away from an offer that is very attractive personally but bad for the service. On the other hand, starting with that mentality is probably bad. c.f. pg's "do something you think is good for the world"
- codemechanic 16y ago
  I agree. As more and more services close, customers will be wary of putting content online or using a public online service. Thats the reason we started Tonido.

Rantenki 16y ago

Obviously not for their ability to build scalable blogging services (dropio blog site currently down) ;)

waxman 16y ago

Facebook's recent talent acquisitions sort of make sense to me from Facebook's standpoint (good, entrepreneurial talent is hard to find), but I wonder how the founders, employees, users, and investors feel about these relatively odd buyouts. This drop.io deal sounds a lot like the Hot Potato acquisition from a few months ago: in both cases the startups were well-funded, but didn't have much traction, and then Facebook paid 8 figures to essentially buy the main founder (Sam Lessin at drop.io, Justin Schaffer at Hot Potato), and essentially let everything else die (the sites were shut down, the technology scrapped, other employees weren't hired by facebook, etc.) A few questions for HN: - Is Facebook paying too much for these founders? (They're basically shelling out a $10 MM signing bonus that lets these entrepreneurs placate their investors, and then come to Facebook. (Accept the founders only get a fraction of the money, obviously). Is it worth it? What are other new Facebook executives paid in signing bonuses?) - What do the investors think about this? (Are the investors in Hot Potato and Drop.io happy to get a modest return instead of nothing (because these companies hadn't taken off yet), or are they frustrated that these companies ended somewhat abruptly?) - How do the employees feel? (Does it feel like success for them when the whole point of the acquisition is really just to buy their boss? Obviously they get money for their equity, so maybe that trumps any other feelings.) [Full disclosure: I actually work with one of the co-founders of Hot Potato (who didn't go to Facebook), so I know his opinions on this issue, but I'm still curious to hear others' thoughts]. - How do users feel? (Are these buyouts fair to them?) - And lastly, Isn't there a slight paradox with the fact that these founders are being plucked at such high premiums because they're brilliant leaders, and yet, in both the cases of Hot Potato and Drop.io, these startups weren't runaway successes? In other words, doesn't the lack of clear success of these startups undermine the basic premise that the founders deserve $10 MM "signing bonuses"?

hartror 16y ago
I doubt the investors are unhappy with an exit, employees and users on the other hand are probably disappointed (though I hope the employees saw something of the exit which probably alleviates disappointment).
_delirium 16y ago
As a user it's definitely somewhat disheartening. It seems like whenever something cool/useful comes from a small, previously unknown team, there's a significant chance that it'll just be bought and killed by a big player. Both makes me more wary of relying on such services to begin with (even if they're paid!), and from a progress-of-technology perspective feels unfortunate. I'm sure it's great for the founders, but it's like big companies are using their cash pile to do the opposite of encouraging technological progress: find technological progress elsewhere, buy it, and axe it. Things do occasionally turn out okay, e.g. Google allowed the EtherPad team to open-source the code after Google bought/killed it. And, although I don't personally use/like it, Dodgeball got more or less resurrected as FourSquare after Google bought/killed it.

sabat 16y ago

A replacement for Drop.io is already in the works, I imagine. (And Dropbox won't cut it for a lot of people; it's not as straightforward to do a simple fileshare, and there are other cool features [e.g. RSS] that Dropbox doesn't do.)

maguay 16y ago
Dropbox does actually offer an RSS feed with file changes in your public folder.
prawn 16y ago
Even Drop.io wasn't particularly straightforward IMO. I would give the URL to clients who needed to get me a batch of files and many would not understand the process without help.

meemo 16y ago

Maybe some should copy their business plan and enter that market niche they occupied (assuming their plan has been successful so far).

deleted 16y ago
[deleted]

deleted 16y ago

[deleted]

davidu 16y ago

This was a sale of near last resort. This was not a "win" or an "exit" by any measure.

johanhil 16y ago
Did they really burn through their $4.85M from their Series C in 6 months?
- davidu 16y ago
  If you are burning $500,000/month, which is not unreasonable, then you get 10 months with $5mm. If you haven't turned the corner after 5 months, you know you won't get out of the hole before you run out of cash. Therefore, you sell the company and reduce your burn as much as possible to make a sale happen. If your sale is all about talent and not the technology there is almost no due diligence required and a deal can happen quickly, in about a month.
  - jack7890 16y ago
    It's not unreasonable for drop.io to burn $500k/mo? I run a ten-man startup and I can't fathom burning that much.
    - forsaken 16y ago
      You pay people less than 50k/mo?
      - jemfinch 16y ago
        If he doesn't, I'm working for the wrong company.
      - deleted 16y ago
        [deleted]
    - teaspoon 16y ago
      Do you host an unlimited number of 100MB files, indefinitely, for an unlimited number of non-paying users?

webnerd 16y ago

Does anyone know the deal price?

smarterchild 16y ago

I always wondered how Drop.io made money. I use it all the time for one time file sharing drops, but they never had anything to sell me.

deleted 16y ago

[deleted]

not_marak 16y ago

1. drop.io is going away 2. Sam Lessin is leaving New York City Sounds like great news to me :-)

MediaSquirrel 16y ago

It took the longest time for me to understand what Drop.io did. And during most of that time I was a NYC entrepreneur. It's hard to build a real company if no one understands what you do. Maybe they would have had a better outcome had they hired a CEO who could create & communicate a cohesive vision. But that's just me.

tensor 16y ago
No one that I've suggested drop.io to has ever even heard of it. The response, on the other hand, has been "oh wow! this is cool!" They certainly could have used more marketing as far as I've seen. I'm sad to see them go.

paul9290 16y ago

Congrats to Drop.io. In 2007 I presented my start-up at the New York Tech Meetup (http://www.businessinsider.com/2007/11/nytech-meetup-at-iac http://www.businessinsider.com/2007/11/nytech-meetup-at-iac). It was an odd meetup as only two unknown start-ups presented that evening, mine and a complete unknown, Drop.io who launched at the meetup. Other presenters were established companies presenting new products.

rradu 16y ago

Hm, someone just asked me this week if their data will last on Drop.io--I told them yea for sure, they've been around for a long time, they're not just gonna shut down all of a sudden. And then this.

cavilling_elite 16y ago

My first thought was to take Drop.io and create a Google wave out of it. Now that Rasmussen has defected to Facebook, this may be true(http://techcrunch.com/2010/10/29/rasmussen-facebook-google/ http://techcrunch.com/2010/10/29/rasmussen-facebook-google/)

jkhaff 16y ago

I'd love hearing more drop.io alternative suggestions from others. Dropbox and Tonido have been mentioned, but they really aren't the same thing. My band lives in various areas of the country, and we share mp3 files via drop.io. We're able to comment on each riff/song, link directly to the files, get updates via RSS, and even listen to the mp3s without downloading them. Anything else like this exist?

sharadgopal 16y ago
maybe try cloudapp ? http://www.getcloudapp.com/ http://www.getcloudapp.com/
rahulchaudhary 16y ago
You can check here, http://alternativeto.net/software/dropio/ http://alternativeto.net/software/dropio/
Jardenberg 16y ago
For that specific need you should use http://soundcloud.com http://soundcloud.com
- jkhaff 16y ago
  Thanks for the suggestions. SoundCloud would be great, except keeping the riffs/music private is important and there's no secret link sharing in the free account (the lite account is €30). Still searching for alternatives... nothing I've seen yet is as good as drop.io for this purpose.
follower 16y ago
> Dropbox and Tonido have been mentioned, but they really aren't the same thing. As an aside, an interesting difference with Tonido is they also sell a "plug-in server" for their service too: http://www.tonidoplug.com/ http://www.tonidoplug.com/ I assume it's based on a SheevaPlug / Marvell Plug Computer style device.
jcn 16y ago
I'll have to give a plug for my company Indaba Music here - http://indabamusic.com http://indabamusic.com Our site was pretty much designed exactly for this use case - the free account allows for private sessions, in-song commenting and in-session discussion.

_pius 16y ago

Drop.io has very interesting technology; I think it deserved more than a talent acquisition. Their company had a positioning problem. They built a platform that did something very unique (abstracting the coolest features from XMPP into an HTTP/RESTful API) and yet the takeaway for most people is that it's "a file sharing service." Had the Drop.io team done a better job communicating their value proposition to developers with clarity and aggressively positioning their service, I think they could have had a big following.