8 ms·
Google Offered To Buy Twitter For $2.5-$4 Billion
- brown9-2 16y agoBoth sources speculate that Microsoft may have made an offer too. This makes sense to us. One reason Google would buy Twitter is to keep it out of Microsoft's hands.The logic goes the other way, too. This M&A/portfolio game seems so silly. The companies bought up by the goliaths to use against each other seem to rarely have a successful life post-acquisition.
- pavs 16y ago>The companies bought up by the goliaths to use against each other seem to rarely have a successful life post-acquisition. Can you give some examples?
- borism 16y agoSun? Depends on what you mean by successful of course.
- bhousel 16y agoI disagree, I think that most companies acquired by Google have had a very successful life post acquisition. Sure there are a few notable exceptions (Dodgeball), but generally Google doesn't acquire a company unless they plan to keep it alive for something. http://en.wikipedia.org/wiki/List_of_acquisitions_by_Google http://en.wikipedia.org/wiki/List_of_acquisitions_by_Google
- brown9-2 16y agoI was referring less to overall acquisitions than companies/startups acquired as a part of a "portfolio" or to compete with another goliath company. For example, Yahoo or Microsoft's attempt to acquire Facebook to get into "social". Can you imagine what Facebook would be like today if that had happened?
- jdp23 16y agoMicrosoft in particular has a horrible record with acquisitions work. There are exceptions of course. Hotmail worked out well, and back in 1999 they bought my startup for $60M, and it worked out great. But eight years later, when I left, we were still being used as the rare example of when it actually worked out. Almost all the other much bigger deals since then had foundered badly, killed by politics or the NIH syndrome or management incompetence. Google's had some successes, most obviously YouTube, and they're probably a better cultural match for Twitter. I can see why Twitter turned down the $2.5B but it seems like a fair offer.
- riffraff 16y agoWhy is google a better match for twitter than microsoft? Google appears to have tried to "become social" a few more times than redmond and failed regularly.
- jdp23 16y agofrom the outside, Twitter seems to have more of the Valley-style engineering culture, and shares Google's API-oriented philosophy. Also there are some former Googlers in key roles there. It's a good point about Google not getting social. Then again, Microsoft's also tried and failed to go social multiple times -- Windows Live Spaces, QnA, Groove, Hailstorm, and 3° are a few fairly-high-profile examples that leap to mind.
- InclinedPlane 16y agoTwitter has become a platform. Google is far better at web-platforms than Microsoft.
- Encosia 16y agoI think Microsoft gets less credit than Google for acquisitions because they're actually better (note: I didn't say good) at rolling acquisitions into the company and moving forward with a product. Most people don't think of successful Microsoft products like SQL Server 7+, Kinect, Foxpro, Visio, and Dynamics as acquisitions. Sure, there are notable failures like Danger/Kin, but there are a lot of successes. Meanwhile, it breaks my heart every time one of my favorite services is acquired by Google. FeedBurner, GrandCentral, and Etherpad are all services that I'd have much rather paid to use on their previous innovation trajectory, rather than watch them stagnate while rewriting for Google's infrastructure (or killed, in Etherpad's case) and be saddled with the clunky GWT interface.
- borism 16y agoI think Twitter would be very bad fit for any tech company, but it would also be very surprising to me if they can achieve valuation of anything above $5bn post-IPO...
- aresant 16y agoI never thought I'd say it but Google paying up to $4 or 5b for Twitter kind of makes sense. Google badly wants a "social media" win. Twitter, for better or for worse, is the cheapest household brand name of social media. I've personally found much value from searching archived Tweets via twitter & google which suggests that Google could monetize that asset, as they've done with YouTube, and turn this into a huge win since selling ads is such a core competency. On the other hand, Google's biggest aquisition win - YouTube - they got for a relative "steal" at ~$1.65b in an ALL stock transaction, which you know isn't going to happen with Twitter. http://mashable.com/2010/07/09/google-social-media-attempts/ http://mashable.com/2010/07/09/google-social-media-attempts/ - Google's history of social media attempts
- lawfulfalafel 16y agoI think twitter would fit with google because they can leap any privacy concerns. After the buzz fiasco and the reaction to the facebook privacy changes a public social network like twitter might be more valuable than it seems.
- deleted 16y ago[deleted]
- frb 16y agoIs Twitter actually making any money? I find these billion dollar valuations pretty crazy if the company in question is not actually making any money. Sure, Microsoft and Google have their strategies and would spare no pains (money) to score each other off, but this overvaluation of companies is just not healthy for the tech industry. It just feeds the next big bubble.
- malloreon 16y agoDuring a conversation I had last week a colleague who's dealt with Twitter told me that they make $100M-$200M each year licensing the firehose.
- rabble 16y agoI remember back in the day, 3 or 4 years ago now, when Yahoo tried to buy Twitter for $25 million, and twitter demanded $100 million. They couldn't come to an agreement, and the deal fell through. Funny how the longer they wait, the more pricey Twitter becomes.
- lrm242 16y agoWhy is that funny? By definition, as a good business grows it will be worth more. It's not like Twitter has been standing still for 3 years.
- brianobush 16y agoIs twitter really that unique? I know mindshare wise, it has front-of-the-bus valuation, but the technology behind it is quite simple (and should be written up as a RFC).
- InclinedPlane 16y agoThe technology behind twitter is trivial in the abstract. At scale it's decidedly non-trivial. See also: paypal.
- brianobush 16y agoGoogle has solved many of the hard problems that would render twitter a trivial. I am not declaring a 150 line python script would duplicate it, but that Google could easily build a similar service. Now mindshare is a different story.
- InclinedPlane 16y agoYes, but no. Google's systems are tuned to google's apps, twitter is similar but also different in some fundamental ways. The complexity of rendering every individual twitter feed is pretty significant compared to, say, gmail, and the same optimizations do not always make sense. Moreover, the complexity of the SMS back-end should not be dismissed. While google certainly has the chops to handle all of these problems, including SMS, it's still a bit much to say that google engineers could reinvent twitter better and faster with little effort. The biggest piece of evidence that this is the case is the simple fact that they haven't yet. Despite trying (see: buzz).
- jon_dahl 16y agoTwitter is a network that is used by 150 million people. It is embedded deeply into thousands of software systems. Millions of people consider it an important part of daily life - maybe more important than things like newspaper and cable TV. Every day, Twitter publishes (and collects) something like 50m tweets, and their database contains maybe the best record of what's happened in the digital world in the last few years. That's unique.
- mkramlich 16y agototally not surprised. Twitter seemed like a great fit for Google.