8 ms·

Spin-in startups from Cisco

71 points by vkdelta 12y ago

bsiemon 12y ago
This is interesting. It seems like a large bureaucracy like cisco recognized it's own flaws and used this method to get around the institutionalized toxicity to crazy ideas. You get to leave all the friction of creating new ideas in a large org behind. The price seems incredibly steep vs just creating a company that is friendly to new ideas (of course creating such a company is no easy task).
tptacek 12y ago
Cisco is famous for this; if you work in a field where Cisco is a potential acquirer, your company has probably had several meetings with Cisco BD. There's a downside. A skilled PM or engineer in Cisco who gets a product MRD has a choice to make. They can keep their heads down and implement internally, or they can jump ship and start a company knowing that Cisco wants it in the future. To make matters worse: it's not exactly unlikely that Cisco will buy a company to get that product even if you do a good job implementing it internally. It's not just MPLS that Cisco "spins in". I know people without the MPLS cachet that have done the same thing at Cisco several times.
- mathattack 12y ago
  I've known folks who left Cisco on the assumption that "The mothership will buy us, and I will get my old seat back." It didn't work out that way, though the folks wound up doing fine anyway.
qthrul 12y ago
If a team consistently 'delivers' time and time again with a specific structure and arrangement it makes sense that the same team would be reconsidered -- time and time again.
beambot 12y ago
I hear about lots of companies trying to do "internal startups." If your company is contemplating this.... then reading about Cisco's "spin in" successes is mandatory. I keep trying to tell people: If corporate "startup" founders don't have massive upside potential (spelled out in contracts), then it's probably not a "startup." It's just another way for the company to extract more productivity out of salaried employees. Over the long term, equity-starved founders will have to endure insane stress, massive efforts, and other startup "glass chewing".... This will be challenging if founders don't have the potential for a big payoff upon success. For example, this is why VCs are so concerned about ensuring founders have enough skin in the game.
petercoolz 12y ago
This is one of the the few cases where Clayton Christenson's insights on disruption apply. Insieme was founded on the premise of trying to disrupt Cisco's existing business because Cisco cannot effectively do so from within.
trevmckendrick 12y ago
This is great, but how do they possibly come up with a fair price? Even assuming Cisco doesn't want to screw anyone, what's MPLS's best alternative offer if Cisco's offer is too low?
amirmc 12y ago
Original article is at http://www.businessinsider.com/why-cisco-showered-three-men-with-billions-2014-9 http://www.businessinsider.com/why-cisco-showered-three-men-... (link currently points at a Yahoo copy).
- dang 12y ago
  Thanks—changed from https://www.yahoo.com/finance/news/why-cisco-showered-three-men-121320914.html https://www.yahoo.com/finance/news/why-cisco-showered-three-....
salem 12y ago
Cisco does this because they suck at assessing performance of, remunerating, and retaining top engineering talent. The best engineers figure out pretty quickly that they'll get more interesting work and more money by riding the Cisco-Juniper-Startup-Cisco merry-go-round a couple of times.
- antr 12y ago
  By doing this they acknowledge their problems, and have found a solutions to the problem. I personally think that this 'spin in' approach is admirable.
  - salem 12y ago
    Well, the jury is still out on whether this is sustainable, and, as the article points out, whether it produces the best outcome. Also, reading between the lines, it means you're a sucker if you don't ride the merry-go-round.
- mathattack 12y ago
  Is it that Cisco sucks at this, or do all big companies suck at this? At some point "Getting along with others" trumps "Bringing in money" and "Building great things" (or combined, "Building great things that people will pay for") at big companies. The result of this is a bunch of "Well rounded B+ employees". Well rounded B+ employees don't change the world. For every company that's 20+ years old with 10,000+ employees who does a great job managing top engineering talent, I can point 5 that do it awful. (ok, let's not go through that exercise, but it's the point...)
  - salem 12y ago
    Well, you'd probably find that those 1/5 companies that don't suck at managing engineering talent are probably run by former engineers, not former sales guys. The best career options for engineers in Cisco are: * sales engineer (not really engineering) * become a manager * jump ship to juniper * go to a startup, maybe even get bought back by Cisco with a career boost * shoot for the moon, stay and maybe become a Cisco Distinguished Engineer, which are like unicorns Ergo, rank and file engineers are not valued by management, like they are at Facebook/Google/etc.
bankim 12y ago
From what I hear, Noiro Networks/Project is the next "spin-in" from Cisco http://www.networkworld.com/article/2176631/data-center/little-known-cisco-open-source-project-among-contributors-to-openstack-neutron-policy.html http://www.networkworld.com/article/2176631/data-center/litt...

71 points by vkdelta 12y ago

This is interesting. It seems like a large bureaucracy like cisco recognized it's own flaws and used this method to get around the institutionalized toxicity to crazy ideas. You get to leave all the friction of creating new ideas in a large org behind. The price seems incredibly steep vs just creating a company that is friendly to new ideas (of course creating such a company is no easy task).

tptacek 12y ago

Cisco is famous for this; if you work in a field where Cisco is a potential acquirer, your company has probably had several meetings with Cisco BD. There's a downside. A skilled PM or engineer in Cisco who gets a product MRD has a choice to make. They can keep their heads down and implement internally, or they can jump ship and start a company knowing that Cisco wants it in the future. To make matters worse: it's not exactly unlikely that Cisco will buy a company to get that product even if you do a good job implementing it internally. It's not just MPLS that Cisco "spins in". I know people without the MPLS cachet that have done the same thing at Cisco several times.

mathattack 12y ago
I've known folks who left Cisco on the assumption that "The mothership will buy us, and I will get my old seat back." It didn't work out that way, though the folks wound up doing fine anyway.

qthrul 12y ago

If a team consistently 'delivers' time and time again with a specific structure and arrangement it makes sense that the same team would be reconsidered -- time and time again.

beambot 12y ago

I hear about lots of companies trying to do "internal startups." If your company is contemplating this.... then reading about Cisco's "spin in" successes is mandatory. I keep trying to tell people: If corporate "startup" founders don't have massive upside potential (spelled out in contracts), then it's probably not a "startup." It's just another way for the company to extract more productivity out of salaried employees. Over the long term, equity-starved founders will have to endure insane stress, massive efforts, and other startup "glass chewing".... This will be challenging if founders don't have the potential for a big payoff upon success. For example, this is why VCs are so concerned about ensuring founders have enough skin in the game.

petercoolz 12y ago

This is one of the the few cases where Clayton Christenson's insights on disruption apply. Insieme was founded on the premise of trying to disrupt Cisco's existing business because Cisco cannot effectively do so from within.

trevmckendrick 12y ago

This is great, but how do they possibly come up with a fair price? Even assuming Cisco doesn't want to screw anyone, what's MPLS's best alternative offer if Cisco's offer is too low?

amirmc 12y ago

Original article is at http://www.businessinsider.com/why-cisco-showered-three-men-with-billions-2014-9 http://www.businessinsider.com/why-cisco-showered-three-men-... (link currently points at a Yahoo copy).

dang 12y ago
Thanks—changed from https://www.yahoo.com/finance/news/why-cisco-showered-three-men-121320914.html https://www.yahoo.com/finance/news/why-cisco-showered-three-....

salem 12y ago

Cisco does this because they suck at assessing performance of, remunerating, and retaining top engineering talent. The best engineers figure out pretty quickly that they'll get more interesting work and more money by riding the Cisco-Juniper-Startup-Cisco merry-go-round a couple of times.

antr 12y ago
By doing this they acknowledge their problems, and have found a solutions to the problem. I personally think that this 'spin in' approach is admirable.
- salem 12y ago
  Well, the jury is still out on whether this is sustainable, and, as the article points out, whether it produces the best outcome. Also, reading between the lines, it means you're a sucker if you don't ride the merry-go-round.
mathattack 12y ago
Is it that Cisco sucks at this, or do all big companies suck at this? At some point "Getting along with others" trumps "Bringing in money" and "Building great things" (or combined, "Building great things that people will pay for") at big companies. The result of this is a bunch of "Well rounded B+ employees". Well rounded B+ employees don't change the world. For every company that's 20+ years old with 10,000+ employees who does a great job managing top engineering talent, I can point 5 that do it awful. (ok, let's not go through that exercise, but it's the point...)
- salem 12y ago
  Well, you'd probably find that those 1/5 companies that don't suck at managing engineering talent are probably run by former engineers, not former sales guys. The best career options for engineers in Cisco are: * sales engineer (not really engineering) * become a manager * jump ship to juniper * go to a startup, maybe even get bought back by Cisco with a career boost * shoot for the moon, stay and maybe become a Cisco Distinguished Engineer, which are like unicorns Ergo, rank and file engineers are not valued by management, like they are at Facebook/Google/etc.

bankim 12y ago

From what I hear, Noiro Networks/Project is the next "spin-in" from Cisco http://www.networkworld.com/article/2176631/data-center/little-known-cisco-open-source-project-among-contributors-to-openstack-neutron-policy.html http://www.networkworld.com/article/2176631/data-center/litt...