5 ms·

I don't think it was a GoogleX project, but Chronicle was spun out from Google as an independent company. It grew well, and seemed ready to succeed on its own.

by agar 6y ago

I don't think it was a GoogleX project, but Chronicle was spun out from Google as an independent company. It grew well, and seemed ready to succeed on its own. Google then re-acquired it. Speculation, but perhaps Google was concerned about it getting acquired by a competitor as it used a lot of core Google search technology. Or, perhaps Google knew that the acquisition cost would spiral upwards if they waited much longer. Or, perhaps it just proved out the hypothesis that the product was viable, so better to bring it back in-house. But I would call it successful by conventional metrics: it found product-market fit, had good customer traction, and was acquired at a decent (though not crazy) valuation.

dsl 6y ago
Chronicle had two businesses under one roof. One is VirusTotal, which is super important to the security community but I don't think generates enough revenue to live on its own. The other is a strange "Splunk Lite" offering that as far as I could tell the main selling point was it was way cheaper because Google gave them free/discounted storage. The search was terrible. It didn't highlight important things or hide the mundane. When I saw a demo it didn't even support IPv6 yet. But I guess every moonshot factory has to have its Challenger disaster to learn a few lessons.
thenightcrawler 6y ago
Chronicle actually busted pretty bad! Have a friend who worked there and he described it as a nightmare, and not the productive kind. https://www.vice.com/en_us/article/9kej3e/chronicle-is-dead-and-google-killed-it https://www.vice.com/en_us/article/9kej3e/chronicle-is-dead-...
ChuckMcM 6y ago
This is the scenario I expect, Waymo gets "spun out" and does its R&D on someone else's nickel and Google doesn't have to report the losses, then if it takes off, Google re-acquires it in a sweetheart deal and reaps all the goodness. From my experience working there, this is the sort of concept they would be attracted to. Google gets a benefit from either scenario. From the counter party part of this deal, the "investors" either lose their money, or they get a fixed amount of 'upside' when Google re-acquires.
- Traster 6y ago
  What you're desrcbing is fiduciaries violating their responsbilities to shareholders.
  - ChuckMcM 6y ago
    I am sure that at least 50.1% of voting shares explicitly approve any crazy scheme Alphabet comes up with. That has been their get-out-of-jail-free card since, well forever.
    - Traster 6y ago
      50.1% doesn't magically absolve you of the responsibility to maximize shareholder value. They could vote to sell to Alphabet for $1 - it would result in a massive lawsuit.
      - ChuckMcM 6y ago
        Yes, people can and will sue for any reason. But in this case this is how the suit would likely go ... plaintiff: "Your honor these share holders are suing the company for violating its fiduciary duty." company; "Your honor, we know that some share holders may not always agree with the majority, but we made sure that over 50% of the share holders were on board with every decision we've made. We move to dismiss." Judge: "You have documented that the majority agreed?" company: "Yes your honor" Judge: "And every shareholder has access to the bylaws of the company which state in clear and unequivocal terms that all decisions will be decided by a simple majority vote?" company: "Yes your honor." "case dismissed."
- KKKKkkkk1 6y ago
  If this is merely a scheme for Google to sweep the losses under the carpet, what's in it for the investors who'll be left holding the bag? And mind you, in order for the losses to go away, the value of the company at the time it's spun out needs to exceed the billions of dollars already invested in it over the span of 12 years. (Including $120m paid out in bonuses to Anthony Levandowski alone.)
foobiekr 6y ago
sounds like a spin-out/spin-in model. you do these primarily to create special compensation packages. the inclusion of a non-revocable license to core technology is a common part of such structures because it gives the people who take the risk some proof against management changes that otherwise sink such deals.

by agar 6y ago

dsl 6y ago

Chronicle had two businesses under one roof. One is VirusTotal, which is super important to the security community but I don't think generates enough revenue to live on its own. The other is a strange "Splunk Lite" offering that as far as I could tell the main selling point was it was way cheaper because Google gave them free/discounted storage. The search was terrible. It didn't highlight important things or hide the mundane. When I saw a demo it didn't even support IPv6 yet. But I guess every moonshot factory has to have its Challenger disaster to learn a few lessons.

thenightcrawler 6y ago

Chronicle actually busted pretty bad! Have a friend who worked there and he described it as a nightmare, and not the productive kind. https://www.vice.com/en_us/article/9kej3e/chronicle-is-dead-and-google-killed-it https://www.vice.com/en_us/article/9kej3e/chronicle-is-dead-...

ChuckMcM 6y ago

This is the scenario I expect, Waymo gets "spun out" and does its R&D on someone else's nickel and Google doesn't have to report the losses, then if it takes off, Google re-acquires it in a sweetheart deal and reaps all the goodness. From my experience working there, this is the sort of concept they would be attracted to. Google gets a benefit from either scenario. From the counter party part of this deal, the "investors" either lose their money, or they get a fixed amount of 'upside' when Google re-acquires.

Traster 6y ago
What you're desrcbing is fiduciaries violating their responsbilities to shareholders.
- ChuckMcM 6y ago
  I am sure that at least 50.1% of voting shares explicitly approve any crazy scheme Alphabet comes up with. That has been their get-out-of-jail-free card since, well forever.
  - Traster 6y ago
    50.1% doesn't magically absolve you of the responsibility to maximize shareholder value. They could vote to sell to Alphabet for $1 - it would result in a massive lawsuit.
    - ChuckMcM 6y ago
      Yes, people can and will sue for any reason. But in this case this is how the suit would likely go ... plaintiff: "Your honor these share holders are suing the company for violating its fiduciary duty." company; "Your honor, we know that some share holders may not always agree with the majority, but we made sure that over 50% of the share holders were on board with every decision we've made. We move to dismiss." Judge: "You have documented that the majority agreed?" company: "Yes your honor" Judge: "And every shareholder has access to the bylaws of the company which state in clear and unequivocal terms that all decisions will be decided by a simple majority vote?" company: "Yes your honor." "case dismissed."
KKKKkkkk1 6y ago
If this is merely a scheme for Google to sweep the losses under the carpet, what's in it for the investors who'll be left holding the bag? And mind you, in order for the losses to go away, the value of the company at the time it's spun out needs to exceed the billions of dollars already invested in it over the span of 12 years. (Including $120m paid out in bonuses to Anthony Levandowski alone.)

foobiekr 6y ago

sounds like a spin-out/spin-in model. you do these primarily to create special compensation packages. the inclusion of a non-revocable license to core technology is a common part of such structures because it gives the people who take the risk some proof against management changes that otherwise sink such deals.