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"Sunk Costs" ARE part of the discussion you're having. You're just choosing to include them when they probably shouldn't be. They aren't relevant to whether o

"Sunk Costs" ARE part of the discussion you're having. You're just choosing to include them when they probably shouldn't be. They aren't relevant to whether or not an aqui-hire is a success or failure, mostly because they require us to bring up a number of other factors that are nearly impossible to evaluate (we're speculating on pricing that opportunity cost, without speculating on future impact on earnings, or any factors outside $). The idea that an acqui-hire needs to recoupe everyone's potential opportunity cost to be considered successful is silly. The answer to the question is "it depends", and what it really depends on is the possible alternatives at that potential acquisition point, not all possible alternatives that could have happend in the past or future. An acqui-hire is a success if it leads to the best possible outcome at that time.

tptacek 14y ago
Once again: nobody is arguing that acqui-hires are bad moves for the founders.
- viscanti 14y ago
  Once again: neither am I. You're arguing that EVERYONE's opportunity cost should be factored in. I'm saying that regardless of status (Founder, employee, etc), that opportunity cost is a sunk cost, and examining it with respect to determining if an acqui-hire was a successful event is silly. The points I've laid out (working condition preferences, problem area, and future pay) aren't taken into account by simply looking at the potential money left on the table. All of those factors apply to all employees who are acqui-hired. A much better heuristic is to look at the set of possible alternatives at the point of the potential acqui-hire, because there isn't a better heuristic. But an acqui-hire could very well be a bad move for founders. If they have a better alternative on the table, the acqui-hire is a bad move. The answer is that "it depends". Simply looking at the potential money given up (by founder or all employees) doesn't capture most of what's important in determining if it's a success or failure.

tptacek 14y ago

Once again: nobody is arguing that acqui-hires are bad moves for the founders.

viscanti 14y ago
Once again: neither am I. You're arguing that EVERYONE's opportunity cost should be factored in. I'm saying that regardless of status (Founder, employee, etc), that opportunity cost is a sunk cost, and examining it with respect to determining if an acqui-hire was a successful event is silly. The points I've laid out (working condition preferences, problem area, and future pay) aren't taken into account by simply looking at the potential money left on the table. All of those factors apply to all employees who are acqui-hired. A much better heuristic is to look at the set of possible alternatives at the point of the potential acqui-hire, because there isn't a better heuristic. But an acqui-hire could very well be a bad move for founders. If they have a better alternative on the table, the acqui-hire is a bad move. The answer is that "it depends". Simply looking at the potential money given up (by founder or all employees) doesn't capture most of what's important in determining if it's a success or failure.