4 ms·

Or again, don't do it in the first place.

by ehsankia 6y ago

vmception 6y ago
But also, still buy them out for billions.
- SilasX 6y ago
  Shareholder call: CEO: "And for our strategy over the next year, we will consider buying a controlling interest in Plaid..." Icahn-type shareholder: "Really? Why? It would cost a fortune! What's the value proposition there?" CEO: "Because Plaid has a cool ... name ...?"
  - vmception 6y ago
    That could fly, something like the brand name is good and is cheaper than the licensing fees they had offered And just repeat growth over and over again
    - salawat 6y ago
      That's also misrepresenting material facts (in my view, which matters diddly squat in a courtroom without the right lawyer), and lying by omission. The fact that "proving" malintent in the U.S. in M&A's and market shaping revolves around someone finding a rather fiendishly worded memo is somewhat laughable. >"You can't prove I was going to take a cookie! Maybe I just like having my hand in the jar!" If it would get the stink eye from my Mom, the same argument form should not be considered a valid approach to business or legality.
    - SilasX 6y ago
      Fair enough, maybe not the best example. The point is just that they'd have to beat around the bush and not be able to give a good enough reason that justifies a solid buyout price without admitting the monopolist strategy.
  - pkaye 6y ago
    Icahn-type shareholder: Make a clone of Plaid called Tartan.
  - aidenn0 6y ago
    "To better address the varied needs of consumers who may desire peer-to-peer payments via less robust channels along side our world-class debit system" Some meaningless fluff that implies it's not a competitor. Toss in something like "will allow synergies via our X to give consumers more choice about how their debits are processed" and you can even make it sound like you're doing everyone a favor rather than the obvious monopoly move.
- salawat 6y ago
  You know, I have an honest question. If you sell a company to an established player for $Phat_Stacks_Of_Cash, should you qualify as knowingly contributing to bad market behavior? It seems to be accepted that decreases in competition beyond a particular threshold tends to screw up all sorts of incentives and feedback mechanisms. It just seems to me like we're pretty doomed to stagnate and locking the status quo to the whims and operating decisions of $Handful_of_CEOs of huge established firms if we accept that growth to exit via buyout by established player is an accepted norm. I mean, that's exactly the kind of consolidation and small social circle that makes corruption and large scale collusion possible.
  - leetcrew 6y ago
    > If you sell a company to an established player for $Phat_Stacks_Of_Cash, should you qualify as knowingly contributing to bad market behavior? maybe? it seems like this is a variant of the old question: is it (morally) worse to be the hitman or the person who hired the hitman? it takes two to tango, but I'd say creating the incentive is usually worse than following an existing incentive gradient.
  - Nasrudith 6y ago
    The reason they sell out is essentially that they don't expect to be able to do better long term (risk adjusted) essentially regardless of reason. If the entrenched company is offering a large value for a company they recognize some sort of value to it and could try to replicate it with the funding if told "no" and that may be a fight they feel would have a good chance of losing, that growing bigger means it is "not enjoyable/in their skillset" anymore or similar reasons. A doom of stagnation is also less than certain - the sellers care about cash first and foremost and would not priveledge entrenched beyond what they can pay and the given source funding may hypothetically come from many others - whether CEO or even "large collection of retirement or university endowment funding" even if they are run by CEOs essentially are not necessarily the status quo.

Or again, don't do it in the first place.

vmception 6y ago

But also, still buy them out for billions.

SilasX 6y ago
Shareholder call: CEO: "And for our strategy over the next year, we will consider buying a controlling interest in Plaid..." Icahn-type shareholder: "Really? Why? It would cost a fortune! What's the value proposition there?" CEO: "Because Plaid has a cool ... name ...?"
- vmception 6y ago
  That could fly, something like the brand name is good and is cheaper than the licensing fees they had offered And just repeat growth over and over again
  - salawat 6y ago
    That's also misrepresenting material facts (in my view, which matters diddly squat in a courtroom without the right lawyer), and lying by omission. The fact that "proving" malintent in the U.S. in M&A's and market shaping revolves around someone finding a rather fiendishly worded memo is somewhat laughable. >"You can't prove I was going to take a cookie! Maybe I just like having my hand in the jar!" If it would get the stink eye from my Mom, the same argument form should not be considered a valid approach to business or legality.
  - SilasX 6y ago
    Fair enough, maybe not the best example. The point is just that they'd have to beat around the bush and not be able to give a good enough reason that justifies a solid buyout price without admitting the monopolist strategy.
- pkaye 6y ago
  Icahn-type shareholder: Make a clone of Plaid called Tartan.
- aidenn0 6y ago
  "To better address the varied needs of consumers who may desire peer-to-peer payments via less robust channels along side our world-class debit system" Some meaningless fluff that implies it's not a competitor. Toss in something like "will allow synergies via our X to give consumers more choice about how their debits are processed" and you can even make it sound like you're doing everyone a favor rather than the obvious monopoly move.
salawat 6y ago
You know, I have an honest question. If you sell a company to an established player for $Phat_Stacks_Of_Cash, should you qualify as knowingly contributing to bad market behavior? It seems to be accepted that decreases in competition beyond a particular threshold tends to screw up all sorts of incentives and feedback mechanisms. It just seems to me like we're pretty doomed to stagnate and locking the status quo to the whims and operating decisions of $Handful_of_CEOs of huge established firms if we accept that growth to exit via buyout by established player is an accepted norm. I mean, that's exactly the kind of consolidation and small social circle that makes corruption and large scale collusion possible.
- leetcrew 6y ago
  > If you sell a company to an established player for $Phat_Stacks_Of_Cash, should you qualify as knowingly contributing to bad market behavior? maybe? it seems like this is a variant of the old question: is it (morally) worse to be the hitman or the person who hired the hitman? it takes two to tango, but I'd say creating the incentive is usually worse than following an existing incentive gradient.
- Nasrudith 6y ago
  The reason they sell out is essentially that they don't expect to be able to do better long term (risk adjusted) essentially regardless of reason. If the entrenched company is offering a large value for a company they recognize some sort of value to it and could try to replicate it with the funding if told "no" and that may be a fight they feel would have a good chance of losing, that growing bigger means it is "not enjoyable/in their skillset" anymore or similar reasons. A doom of stagnation is also less than certain - the sellers care about cash first and foremost and would not priveledge entrenched beyond what they can pay and the given source funding may hypothetically come from many others - whether CEO or even "large collection of retirement or university endowment funding" even if they are run by CEOs essentially are not necessarily the status quo.