4 ms·

Which is why founders should have a network where one creates good reads and sells to Amazon and then one of the others starts a better good reads right away. T

Which is why founders should have a network where one creates good reads and sells to Amazon and then one of the others starts a better good reads right away. Then when founder A's handcuffs come off he goes and makes a new version of the most recent thing that sold to one of the FAANGs.

smcin 3y ago
Not really because any acquisition is going to have a non-compete to prevent that obvious scenario. Goodreads' Otis Chandler in 2021 invested [0] in BookClub [1] ("building actionable learning cultures through books, for teams"). And Elizabeth Khuri [2] and Chandler both also invested in Looped [3] (a more engaged and interactive livestreaming event service for concerts, comedy and other entertainment) [0]: https://www.crunchbase.com/person/otis-chandler https://www.crunchbase.com/person/otis-chandler [1]: https://www.crunchbase.com/organization/bookclub https://www.crunchbase.com/organization/bookclub [2]: https://www.crunchbase.com/person/elizabeth-khuri https://www.crunchbase.com/person/elizabeth-khuri [3]: https://www.crunchbase.com/organization/looped-6aae https://www.crunchbase.com/organization/looped-6aae
- Qwertious 3y ago
  >Not really because any acquisition is going to have a non-compete to prevent that obvious scenario. This applies even without the non-competes - it takes time to set up a new company and gain marketshare, so even without non-competes the monopoly is successfully kicking the can down the road. And every extra year of monopoly is another years' worth of price-gouging profits, so repeatedly buying out competitors can be worthwhile.
  - smcin 3y ago
    Sure, but if you combine the overall time and market-share advantage due to the non-compete, golden handcuffs/earn-out clauses and non-hireaway, the acquirer gets a big first-mover advantage. I wondered why noone else had since tried to do a book discovery engine at an industrial-scale to compete with Amazon. Here's one 2019 list of book-discovery sites: "Broke By Books: 20 Great Book Websites for Finding What to Read Next" [0] and here's one analysis [1] of the key things Goodreads added value for Amazon: Kindle integration (social, ratings), a storefront that lets them push Kindle as the preferred version for purchases (or else Audible, or Prime and Kindle Unlimited subscription programs), data that can be mined from user reviews and ratings to power ML for better recommendations, understanding users' book- and reading-habits, rich content to increase interaction and hold user attention... I also wondered why the Goodreads cofounders hadn't gone and founded other companies, in other sectors. But essentially Amazon dwarfed other online book retailers, then moved on to much bigger and more profitable sectors (Kindle, digital music, streaming, Alexa, AWS itself, and tons more). [0]: https://brokebybooks.com/20-great-book-websites-for-finding-what-to-read-next/ https://brokebybooks.com/20-great-book-websites-for-finding-... [1]: "Who owns Goodreads?" https://bookriot.com/who-owns-goodreads/ https://bookriot.com/who-owns-goodreads/
- dexterdog 3y ago
  Which is why the founder that succeeded and got the sale is not the one building the new version. He is going off and re-doing an unrelated acquisition.
  - smcin 3y ago
    No, I pointed out that Goodreads' Otis Chandler and Elizabeth Khuri did not go anywhere after the 2013 acquisition. They stayed, for years. Khuri is still there; Chandler continued as Goodreads' CEO till 2019. I was surprised neither of them left sooner than that to do anything new, in any sector.
    - dexterdog 3y ago
      Sometimes golden handcuffs are very comfortable because of the aforementioned gold.

smcin 3y ago

Not really because any acquisition is going to have a non-compete to prevent that obvious scenario. Goodreads' Otis Chandler in 2021 invested [0] in BookClub [1] ("building actionable learning cultures through books, for teams"). And Elizabeth Khuri [2] and Chandler both also invested in Looped [3] (a more engaged and interactive livestreaming event service for concerts, comedy and other entertainment) [0]: https://www.crunchbase.com/person/otis-chandler https://www.crunchbase.com/person/otis-chandler [1]: https://www.crunchbase.com/organization/bookclub https://www.crunchbase.com/organization/bookclub [2]: https://www.crunchbase.com/person/elizabeth-khuri https://www.crunchbase.com/person/elizabeth-khuri [3]: https://www.crunchbase.com/organization/looped-6aae https://www.crunchbase.com/organization/looped-6aae

Qwertious 3y ago
>Not really because any acquisition is going to have a non-compete to prevent that obvious scenario. This applies even without the non-competes - it takes time to set up a new company and gain marketshare, so even without non-competes the monopoly is successfully kicking the can down the road. And every extra year of monopoly is another years' worth of price-gouging profits, so repeatedly buying out competitors can be worthwhile.
- smcin 3y ago
  Sure, but if you combine the overall time and market-share advantage due to the non-compete, golden handcuffs/earn-out clauses and non-hireaway, the acquirer gets a big first-mover advantage. I wondered why noone else had since tried to do a book discovery engine at an industrial-scale to compete with Amazon. Here's one 2019 list of book-discovery sites: "Broke By Books: 20 Great Book Websites for Finding What to Read Next" [0] and here's one analysis [1] of the key things Goodreads added value for Amazon: Kindle integration (social, ratings), a storefront that lets them push Kindle as the preferred version for purchases (or else Audible, or Prime and Kindle Unlimited subscription programs), data that can be mined from user reviews and ratings to power ML for better recommendations, understanding users' book- and reading-habits, rich content to increase interaction and hold user attention... I also wondered why the Goodreads cofounders hadn't gone and founded other companies, in other sectors. But essentially Amazon dwarfed other online book retailers, then moved on to much bigger and more profitable sectors (Kindle, digital music, streaming, Alexa, AWS itself, and tons more). [0]: https://brokebybooks.com/20-great-book-websites-for-finding-what-to-read-next/ https://brokebybooks.com/20-great-book-websites-for-finding-... [1]: "Who owns Goodreads?" https://bookriot.com/who-owns-goodreads/ https://bookriot.com/who-owns-goodreads/
dexterdog 3y ago
Which is why the founder that succeeded and got the sale is not the one building the new version. He is going off and re-doing an unrelated acquisition.
- smcin 3y ago
  No, I pointed out that Goodreads' Otis Chandler and Elizabeth Khuri did not go anywhere after the 2013 acquisition. They stayed, for years. Khuri is still there; Chandler continued as Goodreads' CEO till 2019. I was surprised neither of them left sooner than that to do anything new, in any sector.
  - dexterdog 3y ago
    Sometimes golden handcuffs are very comfortable because of the aforementioned gold.