3 ms·

If there is a lesson to learn, perhaps it's that there's more than one perspective on looking at something. It sounds as if you've been thinking a lot about all

by objclxt 13y ago

If there is a lesson to learn, perhaps it's that there's more than one perspective on looking at something. It sounds as if you've been thinking a lot about all the positives of an acquisition - this is no bad thing, but perhaps you would feel less depressed and dispirited if you considered the other side of the coin. I think an acquisition is a little like a marriage. Nearly everyone goes into them for the 'right reasons'. Both parties are really excited for the future, and looking forward to the adventure - but even then, we know that many marriages (and acquisitions) end up in failure. It would not be the first time a company has been acquired with promises of growth and development only to find that business priorities change, and they're suddenly getting scattered around the acquirer. Let me give you an anecdote to balance your own. About three years ago I was working for a start-up that got acquired by a big, publicly listed company with a ~$1 billion market cap with several 'A-Listers' on the board. We were really excited: we were going to have access to many more markets, be able to accelerate a lot of the stuff we were doing, just like you. Two years later, the entire group was worth less than the amount they'd paid for us, and our market cap had gone from $1 billion to 8 million. Last I heard (by this point I had left), they had just declared Chapter 11. The moral of this story, if there is one, is that you just don't know what's going to happen. Is your company really "about to crash and burn"? Is it that bad? Maybe not (...at least, I'd assume so). Is a "disruptive startup" one that exits in two years? Would being acquired let you keep being disruptive? I think it's great you posted your experiences here - but maybe, and it might just be me reading this into what you've written, you're letting the moment of the now cloud your judgement.

michaelochurch 13y ago
The issue here is that both sides want the acquisition, and it's being blocked for external reasons that have nothing to do with the fundamentals. I'm generally pretty negative on the build-to-flip mentality. However, sometimes an acquisition is the right thing, and I also think this investor is a horrible person for blocking an acquisition that both sides clearly want, just to serve his own career goals. Investors ought to be passive beneficiaries. Yes, their financial interests deserve respect. No, they shouldn't be the real bosses. Funding ought to be the commodity, almost like a utility; talent ought to be treated as scarce and precious (because true talent is). But in the modern Valley, it's gone the other way.
- tptacek 13y ago
  You are totally free to only accept money from investors who will have no control over your company.
  - michaelochurch 13y ago
    As you know, VC is a reputation economy and the VCs all talk and collude. VCs can get whatever terms they want because they know that if you say no, they'll bad-mouth you to the rest of the investor community. It's extortion. People don't end up in those kinds of deals because they're stupid. Not all of them, at least. Often, they have no other choice because an investor will either back them or end them, the latter being a power they have in this backward, feudalistic reputation economy.
    - tptacek 13y ago
      If you feel that way about investors, don't take outside investment. We didn't. Things worked out peachy. It's a strange thing, to feel entitled to set the terms under which people give you their money. We didn't like the available terms. I don't have much nice to say about the venture capitalists I've known. But I don't have an elaborate worldview built around those impressions, and you do. You should try to shake it off.
  - frandroid 13y ago
    Investors become owners. Since when do owners have no say in when they sell their property?
    - tptacek 13y ago
      It's not at all true that all investors end up with control. In fact, in the large, most investors don't. Neither here nor there, though, because it was a buyer's side investor that scotched this deal.

by objclxt 13y ago

michaelochurch 13y ago

The issue here is that both sides want the acquisition, and it's being blocked for external reasons that have nothing to do with the fundamentals. I'm generally pretty negative on the build-to-flip mentality. However, sometimes an acquisition is the right thing, and I also think this investor is a horrible person for blocking an acquisition that both sides clearly want, just to serve his own career goals. Investors ought to be passive beneficiaries. Yes, their financial interests deserve respect. No, they shouldn't be the real bosses. Funding ought to be the commodity, almost like a utility; talent ought to be treated as scarce and precious (because true talent is). But in the modern Valley, it's gone the other way.

tptacek 13y ago
You are totally free to only accept money from investors who will have no control over your company.
- michaelochurch 13y ago
  As you know, VC is a reputation economy and the VCs all talk and collude. VCs can get whatever terms they want because they know that if you say no, they'll bad-mouth you to the rest of the investor community. It's extortion. People don't end up in those kinds of deals because they're stupid. Not all of them, at least. Often, they have no other choice because an investor will either back them or end them, the latter being a power they have in this backward, feudalistic reputation economy.
  - tptacek 13y ago
    If you feel that way about investors, don't take outside investment. We didn't. Things worked out peachy. It's a strange thing, to feel entitled to set the terms under which people give you their money. We didn't like the available terms. I don't have much nice to say about the venture capitalists I've known. But I don't have an elaborate worldview built around those impressions, and you do. You should try to shake it off.
- frandroid 13y ago
  Investors become owners. Since when do owners have no say in when they sell their property?
  - tptacek 13y ago
    It's not at all true that all investors end up with control. In fact, in the large, most investors don't. Neither here nor there, though, because it was a buyer's side investor that scotched this deal.