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What I Wish I Had Known Before Selling to Google
- deleted 13y ago[deleted]
- AznHisoka 13y agoIf you're lucky enough to have "FU" money, then yes, you should worry about whether the acquirer fits your culture, whether you'll have control over decision, etc. But for anyone that doesn't yet have "FU" money, where the alternative is 40+ years as a cube rat if you fail?? Worrying about team culture seems like a luxury.
- robmate 13y agoI think alike, sometimes you don't have the power to decide whether to sell or not to sell
- coderzach 13y ago> where the alternative is 40+ years as a cube rat if you fail?? In what universe is that a likely outcome? For any reasonably talented person, the worst case is getting a 6 figure job at someone else's startup for a few years before you try again.
- Edmond 13y agoI believe it is in this universe :) Easily landing a cushy job after a start-up failure is in fact life in the alternate universe. Besides you don't have eternity to keep trying to start companies, after one or two bursts you are pretty much done if you aren't already wealthy.
- tptacek 13y agoNo. And, no.
- tptacek 13y agoI'm confused as to how any entrepreneur could face "40+ years" as a "cube rat". I had some early success in the '90s but zeroed myself out with the first VC-funded company I founded; I left San Francisco with no savings, a wife and two kids, for a job in Ann Arbor. 4 years later I founded the company I'm at now (which we sold last year.) I could have stayed at that job less than 4 years; I almost left 2.5 years in. My point is: * Even with significant obligations, a startup failure is unlikely to result in your opportunities being limited for very long. Yes, you'll probably end up needing a "real" job for awhile, but (a) not necessarily for very long and (b) if you crater a startup, a normal job is probably a good move anyways. * If the only job you can secure after killing a company is as "cube rat", consider whether your prospects as an entrepreneur are really all that much better. People like to believe that entrepreneurship is something totally different than executing a conventional career, but that's mostly a myth.
- Edmond 13y agoI think you are falling victim to survival bias here. >* Even with significant obligations, a startup failure is unlikely to result in your opportunities being limited for very long. It depends on the obligations, I assume you mean mainly family. If you are lucky(?) you may have a spouse crazy enough to follow you down that uncertain path, but that is not the case for most people.
- jfb 13y agoIf the only job you can secure after killing a company is as "cube rat", consider whether your prospects as an entrepreneur are really all that much better. People like to believe that entrepreneurship is something totally different than executing a conventional career, but that's mostly a myth. This. This. A thousand times, this.
- quickpost 13y ago> People like to believe that entrepreneurship is something totally different than executing a conventional career, but that's mostly a myth. Couldn't agree more. I fell into this trap for a number of years. Once I started taking my business seriously and treating it like a job (an intense one at that), I've had far more success.
- at-fates-hands 13y agoI thought that was the point of a startup in most cases. Developing a product, then getting bought out by one of the larger companies and getting out with your millions.
- chubot 13y agoHe left 1 year into a 4 year agreement, so the implication is that he didn't walk out with as many millions as expected when he signed the agreement.
- mwfunk 13y agoThe point of a startup is to make a successful business. If things are actually shifting towards a meaningful number of people founding startups for the purpose of getting bought out by some huge company later on, we are doomed.
- JetSpiegel 13y agoWelcome to the real world. How did that red pill tasted like?
- hodgesmr 13y agoI was surprised at how short this article was. I feel like a lot more than 240 words could be dedicated to "What I Wish I Had Known Before Selling to Google".. most of which was just filler for "think carefully about the return on investment, including the effect on team culture, not just the bottom line" and no real insight or guidance.
- xpose2000 13y agoI agree... almost felt like an introduction and then just ends.
- dgarrett 13y ago... I was surprised at how short ... most of which was just filler for ... So are you saying it was too short, or too long? ;)
- piyush_soni 13y agoProbably he is saying it is too short even after considering all the fillers that he included which was unnecessary, IMO.
- samatman 13y ago"A play there is, my lord, some ten words long, Which is as brief as I have known a play; But by ten words, my lord, it is too long, Which makes it tedious; for in all the play There is not one word apt, one player fitted"
- johnny99 13y agoHN should automatically dispense karma for all WS quotes.
- larrys 13y agoWell maybe but I totally agree with this and will repeat to reemphasize based on my personal experience: "My one regret was agreeing to stay on for four years." When I sold my company I had to stay on to consult for 3 months. 3 months that was an eternity. I can't even begin to imagine what it must be like to have to work as an employee at a company that you just sold. Just hanging around not directly tied into the outcome in any significant way just is not the same as being "the guy" in charge.
- fit2rule 13y agoI'm quite amused at the general viewpoint that seems to imply that 4 years is a long time to work someplace. It really isn't. 15 years is a long time to work someplace.
- sdfjkl 13y agoThat really depends on how much you hate working there.
- msellout 13y agoIt's all relative.
- dave809 13y agoIt is when you've got the startup bug, think of what you could built in 4 years. In OP's case he built picnik
- troels 13y agoThere's a huge difference between staying 15 years at a place, because it's a nice place to work and fits your life situation, and then signing a contract to stay some place for 4 years, when you'd much rather be doing something else.
- walshemj 13y agoDepends how much your golden handcuffs and presumably Google options on top are for those 4 years.
- _random_ 13y ago4 years is a long time imho. 15 years with no stocks or multiple promotions is a time wasted.
- namenotrequired 13y agoUnless you, uhm, enjoy the work?
- 13y ago
- bryanlarsen 13y agoGoogle spends a lot of money and effort on acqui-hires. If the sentiments expressed in the article are accurate, it does a fairly bad job capitalizing on these acqui-hires. Back in the 90's Cisco had a fairly good reputation for actually being able to capitalize on profitable acquisitions while most of its competitors wasted money on them. Are any of the current crop of serial acquirers actually good at capitalizing on their acquisitions? It's really hard, but those who can do it will have a sizeable advantage moving forward.
- _random_ 13y agoIt's called acqui-killing. Proactive people that were hired are no longer your competitors - for awhile at list. Works if you have lots of cash to spend.
- larrys 13y ago"I should have insisted that Google's crystal ball for Picnik was clearer." This of course totally depends on the money that is being dangled in front of you and the alternatives. Upside, downside, risk etc. Which is why you can't generalize in terms of most business decisions. Here is an example that perhaps people can relate to. You have a car for sale. You are asking $20,000 for it. Through some mistake or error you end up getting a buyer willing to pay $25,000 for it. You feel like you are making out real good. So you have a reason not to put friction in the deal because you are making out like a bandit. You just hope the deal goes through. So if the buyer also wants to know if you will throw in the GPS you say "sure no problem". You aren't going to be picky and potentially kill the golden goose. In another case you have that same $20,000 car for sale but you get offered $15,000 for it. So perhaps you are going to be picky with the details more. Like if the buyer wants you to meet him at an odd time you might say "no it has to be when it is convenient for me". Or if they say "also want the GPS" you will say "no". Or if they say "I need to get a bank loan and it will take me a week" you say "no". (With the 25k deal you take your chances, right? I would if everything else seemed legit).
- kkotak 13y agoThanks buddy. A large number of people reading this would benefit from the insight when Google comes knocking.
- jarjoura 13y agoMy own experience goes like this: I was only an employee, so the motivations for selling to a parent company could be different. Yet from my angle, it was either, A) go for another round of funding or B) find a company that would be a natural fit for our small team and product. When such a company eventually came along, it seemed like a no-brainer deal. We can finally get the resources of the company to help us become stronger and do more interesting things with our product. They assured us they had a place for the product and believed in our mission. Once we got absorbed, things changed. They split us up into different teams and threw product managers at us. We need all of your "startup-foo" energy and creativity to help spark a fire around everyone else they told us. You can get back to your product once you help ignite our core products first. Well, after a year of this so far, we haven't had time to work on anything related to our startup at all. I think it was a fail for everyone except the founders and investors. All the original people seemed burned out already on projects they never signed up to work on. All the non-engineer folk have since left as they got really bad deals. Both of the founders at least made enough from the deal to buy amazing properties in this crazy real-estate markets so I think for them they can shrug off their original baby. In the end though, the product has fallen apart from bit-rot and engineers are slowly moving on to other companies one-by-one.
- dclara 13y agoUnfortunately, this the reality. There are very few exceptions for the startups being acquired. So if you are shooting for to be sold, you'd better to prepare for this outcome. Otherwise, go by yourself, like snapchat and dropbox.
- aantix 13y agoWhat was the typical deal for the core engineers?
- deleted 13y ago[deleted]
- retr0h 13y agoboo hoo two of my companie$ were acquired.
- dclara 13y agoAcquisition usually means acquiring the team (resource, talent), the product, the customer base or simply for killing an potential strong competitor. It's hard to consider the compatibility of culture, style, even the motivations of driving it forward. So the original founder mostly have to leave for another venture if he is aggressive instead of settling down or retiring.
- tzs 13y ago> My one regret was agreeing to stay on for four years. I wound up leaving after a year. This could use some elaboration. Was Google OK with it? Did he have to give up something, such as stock options, for not staying the agreed term?
- laureny 13y ago
- mmaunder 13y agoThose early departures must have been expensive. Pretty standard to have a 25%/year cliff for a 4 year lock-in.
- webwanderings 13y agoI thought they integrated Picknik into Google Plus.
- ChuckMcM 13y ago"Now, as an angel investor in six startups ..." See there was a silver lining about being acquired twice by Google :-). Could it be re-written as "How to use Google to get FU money so that I could sit back and build the things I really wanted to build." ?
- grimlck 13y agoSo, he got FU money. In exchange, he lost the team culture of the business he founded. Not a bad exchange, in my mind - not something to complain about. Compare that to his employees, who likely did not get FU money, and still lost the team culture of the startup.
- programminggeek 13y agoThe big winners in an aquisition are the founders and investors, not the employees unless they have a ton of stock (which basically makes them investors). The average employee is seen as a resource. Google is almost always buying talent, not products. If they want to buy your product, it's usually to shut it down so it doesn't slow down the progress of their big Google products. The only way Google buys something and keeps it alive is if it is big enough or strategic enough to make into flagship products, but those are very rare.
- alextingle 13y agoE.g. Maps. YouTube.
- bbaker 13y agoandroid
- mikehar 13y agoAs a co-founder of Picnik, I was surprised by this article. It contained several errors which is pretty astonishing given its brevity. Here are a few corrections: 1) Sposato was not a founder of Picnik. He was hired by the two founders, myself and Darrin Massena. 2) Sposato did not decide to sell Picnik. Naturally he was very involved in the process, but the decision was ultimately made by the board (which Sposato was not on). I can tell you that it was not an easy choice. 3) Picnik was not a "photo-sharing" site, it was a photo editing site with very limited photo sharing. 4) "One-third of our 25-person team, including my two business partners, quit right off the bat”. Both co-founders worked at Google for slightly more than a year. Sposato was there for about two years. Most of the people who left were marketing support or office management. We did lose our lead designer to Apple, but I don't recall any other product related departures in the first year. Picnik was amazing. Great team, we had a lot of fun and millions of amazing customers. It was very rewarding to work on a product that your customers love. Selling was a tough choice. Picnik was very healthy, profitable and growing. We felt like we were able to capture much of that value in the sale price and also have the opportunity to work on a product at Google that we felt would have a huge impact. Unfortunately for us, within our first six months Google decided to focus on Google+ and there wasn't room for any other photo product outside of Google+. I completely understood at the time why Google+ was important to Google, it just wasn't important to me. So I left. I don't know how we could have been able to predict the shift in focus to Google+ even with perfect visibility into Google. From what I gather, such a large shift in focus and investment was a unprecedented in Google before Google+. I think Google is a great company, I have a super high opinion of the people that I met there. Perhaps this wasn't the optimal exit for the Picnik team, but it was pretty damn good. -mike harrington
- pinaceae 13y agoi like how nobody here talks about the real losers - the picnik user/customers. these exits practically always kill your original product, which is the ultimate fuck you to the user base that got you there to begin with. that's why it's amazing to see companies like dropbox, box, etc to stick to their guns (so far) and not throw away everything they worked for. the whole web startup concept seems broken. it's not about real solutions and sustainable businesses, but rather a giant get rich quick scheme. just need some suckers to fall for it.
- PythonicAlpha 13y agoIt's all times the same thing, I guess: I have seen similar things (from an outsiders view). When you sell your ideas or company to a big corporation, it will be integrated into the corporation structure somehow. And whatever promises you got before, your ideas will get under the wheels of corporation politics. I have seen it once, where young idealists sold their ideas to a corporation and worked on the idea. Some months later, the whole idea was swallowed by a different department and thus closed down. What was left, was the workforce of the idealists and maybe some little money.
- lxmorj 13y agoToo bad there isn't a Right of First Refusal that also applies to shuttering...
- elwell 13y agoI like these shorter articles. There a good size.
- triplesec 13y agolonger original article, in the comments http://www.bizjournals.com/seattle/blog/techflash/2010/03/looking_back_the_email_that_spawned_picnik_googles_latest_buy.html?page=all http://www.bizjournals.com/seattle/blog/techflash/2010/03/lo...
- charlieflowers 13y agoCan anyone give a summary of what Picnik did? I assume their web site is long gone. I'd like to know what features were the basis of such a fast growing business.
- mooreds 13y agoHere you are: https://web.archive.org/web/20100208023751/http://www.picnik.com/ https://web.archive.org/web/20100208023751/http://www.picnik...