7 ms·

Geeknet to be acquired by Hot Topic

68 points by hownottowrite 11y ago

ben1040 11y ago
Always funny how VA Research started out as a company that sold computers and had an absolutely bonkers 1990s IPO[1], only to wind up as a company that just sold T-shirts to people who use computers. [1] http://en.wikipedia.org/wiki/Geeknet#Initial_public_offering http://en.wikipedia.org/wiki/Geeknet#Initial_public_offering
- rwmj 11y ago
  Anyone have the inside story about why VA stopped selling Linux computers? It seems to me a business which could have been huge.
  - dagw 11y ago
    Basically Dell, HP, IBM and everybody else all of a sudden also started offering Linux systems and the competition got too stiff driving down profits and market shares, leading to huge losses in the hardware part of the company. Combine this with the fact that they at the time had a large and seeming solid web and software side business it made sense to focus on that and simply drop the hardware, instead of trying to go head to head with Dell/HP/IBM.
  - ben1040 11y ago
    VA's original raison d'etre was that commodity systems manufacturers like Dell didn't make any effort to support Linux, and they often shipped machines that had hardware that wasn't workable under Linux. If you wanted a known-good supported hardware configuration and you didn't want to build it yourself, then VA was one of your few options. They also were pretty expensive machines, IIRC. There was a tide change around 2000-2001 where those manufacturers began caring about Linux, at least with regard to business customers. Dell's economies of scale and brand basically meant they could steamroll VA.
  - gaius 11y ago
    What's the market for people who want boxes running Linux, but don't want their own installation?
    - normloman 11y ago
      Perhaps they were hoping of building that market. It was feasible that through some effort, you could convert enough every day windows users to Linux, based on the lower price, reliability, and low maintenance (no spyware). In retrospect it was a foolish idea.
VLM 11y ago
I haven't shopped at a classic mall in decades. I wonder if a "thinkgeek" store at a mall would make me go back?
edude03 11y ago
I'm not an economist by any stretch of the definition, but I wonder if the multitudes of acquisitions we're seeing is a net plus or a net minus for the economy
- naturalethic 11y ago
  Every voluntary exchange is a net plus or it wouldn't occur.
  - criley2 11y ago
    It's a net plus for the investors and owners, not necessarily for "the economy". If one believes the health of the economy is measured by the broad-based success of those involved in the economy, then M&A is rarely a net good for the economy, as it generally converts labor and assets into investment and profit. They'll downsize, fire redundant people, sell off redundant assets and be more profitable with a smaller business. Great for investors, not great for the people who lose their jobs and the businesses those displaced workers used to spend at.
    - ISL 11y ago
      Investors are people, too.
    - UK-AL 11y ago
      It sounds bad but firing unnecessary workers means that those workers will eventually be used for something more productive. A net gain.
      - techsupporter 11y ago
        > those workers will eventually be used for something more productive. A net gain. Not always. One of the more strident criticisms of this economic recovery (since 2008) is that the size of the workforce has shrunk because some workers are unable to reenter it after having been laid off. The increases in efficiency seemingly aren't translating into higher wages or more jobs, just more net returns to the finance folks.
falcolas 11y ago
Well, there goes the neighborhood. I've always enjoyed Think Geek, both as a brand and as a company. They have a great sense of humor, and come up with some great T-Shirts. I've also walked my niece through Hot Topic, and I didn't really care much for the quality of their goods, or the feeling I get in their store. I hope TG can retain what makes them good, but I'm not hopeful at this point.
- drincruz 11y ago
  Right, same here; I've always enjoyed picking up great t-shirts from Think Geek. Now, are we looking forward to geek humor shirts sold in a mall? /me shrugs
- amyjess 11y ago
  Hot Topic has had a long, slow decline. They used to be a store for the goth subculture. They carried not only goth fashions but also goth music. They built a good reputation and had a distinct market niche because they were the only place in the mall you could get actual goth stuff. They actually made the subculture accessible to people. And, then, at some point, they stopped caring. They stopped carrying goth music and switched their fashions over to generic "edgy" stuff. They stopped carrying anything belonging to a subculture or anything, and they became just another Spencer's knockoff for kids to buy stuff their parents won't approve of. I shudder to think what will happen if Hot Topic applies this model to ThinkGeek. ThinkGeek has done a good job of, well, doing what Hot Topic used to do: sell products associated with a subculture and make that subculture accessible to people. I'd hate to see it diluted like Hot Topic has been...
  - philwelch 11y ago
    The goth subculture has either been dying out or else the last remaining goths these days are approaching their thirties, so Hot Topic would have had to change up their business model just to survive. For me, ThinkGeek is increasingly catering to a kind of mainstream, pop-culture "geek" subculture that's focused around watching TV more than anything. It's already gone through the same transition that Hot Topic went through. So it's a perfect fit.
brickmort 11y ago
ThinkGeek had already become a geekier Hot Topic somewhere in the past two years. This news isn't surprising.
- chmullig 11y ago
  I think it's been on that trajectory for longer than 2 years. They lost anything that made them unique or interesting years ago. It just became Dr Who/Star Trek/Star Wars/LOTR/whatever franchise of the moment shit.
heimatau 11y ago
Can someone explain this to me? Why would HT buyout Geeknet? Just seems strange to go against their own culture and model.
- electronvolt 11y ago
  It's totally in HT's business model/corporate DNA. Hot Topic's business model is about commodifying, accessorizing, and packaging subcultures in order to sell them at a huge markup. ThinkGeek conveniently packaged nerd/geek culture as a set of things you could buy. Delightfully nerdy things, sure, and their employees seemed to genuinely be pretty nerdy but the model is not too different from HT. Now that being a nerd/geek is starting to become 'cool' (see recent uptick in portrayals of geeky/nerdy protagonists in non-comedy hollywood, etc.), HT probably wants to package up nerd/geek culture, and acquiring ThinkGeek was probably the most straightforward way to do that.
- dagw 11y ago
  Both HT and Geeknet are in the business of selling clothes and fashion accessories to popular subcultures. There may even be a bit of overlap between the two customer bases. Also with geek subculture seemingly on the rise and the HT targeted subcultures seemingly on the decline it seems like a smart move for HT to diversify.
blueskin_ 11y ago
I remember when thinkgeek had a wide variety of genuinely interesting stuff and not just the latest pop culture 'geek' merchandise (sure, they've always had some of that, but years back it wasn't the overriding theme like it is today). This is a sad moment, but probably to have been expected.
gyardley 11y ago
The mainstreaming of 'geek' culture is interesting. It feels like I'm increasingly being targeted - which isn't necessarily a bad thing, because hey, I generally like comic books and video games and light sci-fi / fantasy television shows, and there's a lot more of all of those lately. But why is this happening at this point in time? Is this some sort of response to economic changes in American society? The job market has polarized, with 'geeks' landing on the more attractive side on the divide. Is this a case of an economic domination leading, gradually, to a cultural one? I wonder if strapping on a geeky t-shirt and throwing oneself into geek culture is becoming the equivalent of dressing preppy in the 1980s, with both reflecting higher economic aspirations.
- vosper 11y ago
  I'm not sure it's a response to economic aspirations. I think it's more that a lot of the things that used to mark one as being a geek have become massively mainstream - owning a computer, owning a smartphone, using the internet, using reddit, using emojis / emoticons, etc... At the same time (possibly it's the same effect) the definition of geek has softened. It's much less pejorative, much less sci-fi and math-club, than it used to be. It's almost trendy. It's certainly been co-opted by marketing and consumer interests. Sort-of related, Simon Pegg wrote an interesting blog post recently [1]. Here's an interesting quote: "[...] this extended adolescence has been cannily co-opted by market forces, who have identified this relatively new demographic as an incredibly lucrative wellspring of consumerist potential. Suddenly, here was an entire generation crying out for an evolved version of the things they were consuming as children. This demographic is now well and truly serviced in all facets of entertainment and the first and second childhoods have merged into a mainstream phenomenon." [1] http://simonpegg.net/2015/05/19/big-mouth-strikes-again/ http://simonpegg.net/2015/05/19/big-mouth-strikes-again/
  - toomuchtodo 11y ago
    > At the same time (possibly it's the same effect) the definition of geek has softened. It's much less pejorative, much less sci-fi and math-club, than it used to be. It's almost trendy. It's certainly been co-opted by marketing and consumer interests. I think that's right around the the world found out that if you're a geek, you have leverage (tech skills) are are more likely than the average citizen to have higher than average income (tech workers) or wealth (founders). TL;DR Geeks (we) inherited the modern day economy. "Render unto Caesar the things that are Caesar's, and unto God the things that are God's"
mathgeek 11y ago
Going to be a great opportunity for small geek-centric online retailers to step in and grab some market share. I'm sure I'm not the only one who won't shop at ThinkGeek anymore.
adventured 11y ago
For those unfamiliar, Geeknet had one of the wildest IPO rides in recent history, at the peak of the dotcom bubble: "It was the first time an IPO has ever finished the regular session at above $200 a share on the Nasdaq Stock Market. It meant that in an instant, the stock of the Sunnyvale, Calif., company went from small-capitalization territory to large -- $9.5 billion, or more than half that of Apple Computer." http://www.wsj.com/articles/SB944749135343802895 http://www.wsj.com/articles/SB944749135343802895 "VA Linux Systems took its stock public in an initial public offering (IPO) on 9 December 1999, under the stock symbol LNUX. The IPO offered shares at $30, but the traders held back the opening trade until the bids hit $299. The stock popped up to $320 later in the day, and closed its first day of trading at $239.25—a 698-percent return on investment." http://en.wikipedia.org/wiki/Geeknet#Initial_public_offering http://en.wikipedia.org/wiki/Geeknet#Initial_public_offering And another good story on it: http://www.cnet.com/news/10-years-gone-the-va-linux-systems-ipo/ http://www.cnet.com/news/10-years-gone-the-va-linux-systems-...
libraryatnight 11y ago
Think Geek is mostly just a pop-culture store now, and that's pretty much what Hot Topic is, so this makes sense to me. Think Geek hasn't been focused on 'geeks' in a long time.

68 points by hownottowrite 11y ago

Always funny how VA Research started out as a company that sold computers and had an absolutely bonkers 1990s IPO[1], only to wind up as a company that just sold T-shirts to people who use computers. [1] http://en.wikipedia.org/wiki/Geeknet#Initial_public_offering http://en.wikipedia.org/wiki/Geeknet#Initial_public_offering

rwmj 11y ago
Anyone have the inside story about why VA stopped selling Linux computers? It seems to me a business which could have been huge.
- dagw 11y ago
  Basically Dell, HP, IBM and everybody else all of a sudden also started offering Linux systems and the competition got too stiff driving down profits and market shares, leading to huge losses in the hardware part of the company. Combine this with the fact that they at the time had a large and seeming solid web and software side business it made sense to focus on that and simply drop the hardware, instead of trying to go head to head with Dell/HP/IBM.
- ben1040 11y ago
  VA's original raison d'etre was that commodity systems manufacturers like Dell didn't make any effort to support Linux, and they often shipped machines that had hardware that wasn't workable under Linux. If you wanted a known-good supported hardware configuration and you didn't want to build it yourself, then VA was one of your few options. They also were pretty expensive machines, IIRC. There was a tide change around 2000-2001 where those manufacturers began caring about Linux, at least with regard to business customers. Dell's economies of scale and brand basically meant they could steamroll VA.
- gaius 11y ago
  What's the market for people who want boxes running Linux, but don't want their own installation?
  - normloman 11y ago
    Perhaps they were hoping of building that market. It was feasible that through some effort, you could convert enough every day windows users to Linux, based on the lower price, reliability, and low maintenance (no spyware). In retrospect it was a foolish idea.

VLM 11y ago

I haven't shopped at a classic mall in decades. I wonder if a "thinkgeek" store at a mall would make me go back?

edude03 11y ago

I'm not an economist by any stretch of the definition, but I wonder if the multitudes of acquisitions we're seeing is a net plus or a net minus for the economy

naturalethic 11y ago
Every voluntary exchange is a net plus or it wouldn't occur.
- criley2 11y ago
  It's a net plus for the investors and owners, not necessarily for "the economy". If one believes the health of the economy is measured by the broad-based success of those involved in the economy, then M&A is rarely a net good for the economy, as it generally converts labor and assets into investment and profit. They'll downsize, fire redundant people, sell off redundant assets and be more profitable with a smaller business. Great for investors, not great for the people who lose their jobs and the businesses those displaced workers used to spend at.
  - ISL 11y ago
    Investors are people, too.
  - UK-AL 11y ago
    It sounds bad but firing unnecessary workers means that those workers will eventually be used for something more productive. A net gain.
    - techsupporter 11y ago
      > those workers will eventually be used for something more productive. A net gain. Not always. One of the more strident criticisms of this economic recovery (since 2008) is that the size of the workforce has shrunk because some workers are unable to reenter it after having been laid off. The increases in efficiency seemingly aren't translating into higher wages or more jobs, just more net returns to the finance folks.

falcolas 11y ago

Well, there goes the neighborhood. I've always enjoyed Think Geek, both as a brand and as a company. They have a great sense of humor, and come up with some great T-Shirts. I've also walked my niece through Hot Topic, and I didn't really care much for the quality of their goods, or the feeling I get in their store. I hope TG can retain what makes them good, but I'm not hopeful at this point.

drincruz 11y ago
Right, same here; I've always enjoyed picking up great t-shirts from Think Geek. Now, are we looking forward to geek humor shirts sold in a mall? /me shrugs
amyjess 11y ago
Hot Topic has had a long, slow decline. They used to be a store for the goth subculture. They carried not only goth fashions but also goth music. They built a good reputation and had a distinct market niche because they were the only place in the mall you could get actual goth stuff. They actually made the subculture accessible to people. And, then, at some point, they stopped caring. They stopped carrying goth music and switched their fashions over to generic "edgy" stuff. They stopped carrying anything belonging to a subculture or anything, and they became just another Spencer's knockoff for kids to buy stuff their parents won't approve of. I shudder to think what will happen if Hot Topic applies this model to ThinkGeek. ThinkGeek has done a good job of, well, doing what Hot Topic used to do: sell products associated with a subculture and make that subculture accessible to people. I'd hate to see it diluted like Hot Topic has been...
- philwelch 11y ago
  The goth subculture has either been dying out or else the last remaining goths these days are approaching their thirties, so Hot Topic would have had to change up their business model just to survive. For me, ThinkGeek is increasingly catering to a kind of mainstream, pop-culture "geek" subculture that's focused around watching TV more than anything. It's already gone through the same transition that Hot Topic went through. So it's a perfect fit.

brickmort 11y ago

ThinkGeek had already become a geekier Hot Topic somewhere in the past two years. This news isn't surprising.

chmullig 11y ago
I think it's been on that trajectory for longer than 2 years. They lost anything that made them unique or interesting years ago. It just became Dr Who/Star Trek/Star Wars/LOTR/whatever franchise of the moment shit.

heimatau 11y ago

Can someone explain this to me? Why would HT buyout Geeknet? Just seems strange to go against their own culture and model.

electronvolt 11y ago
It's totally in HT's business model/corporate DNA. Hot Topic's business model is about commodifying, accessorizing, and packaging subcultures in order to sell them at a huge markup. ThinkGeek conveniently packaged nerd/geek culture as a set of things you could buy. Delightfully nerdy things, sure, and their employees seemed to genuinely be pretty nerdy but the model is not too different from HT. Now that being a nerd/geek is starting to become 'cool' (see recent uptick in portrayals of geeky/nerdy protagonists in non-comedy hollywood, etc.), HT probably wants to package up nerd/geek culture, and acquiring ThinkGeek was probably the most straightforward way to do that.
dagw 11y ago
Both HT and Geeknet are in the business of selling clothes and fashion accessories to popular subcultures. There may even be a bit of overlap between the two customer bases. Also with geek subculture seemingly on the rise and the HT targeted subcultures seemingly on the decline it seems like a smart move for HT to diversify.

blueskin_ 11y ago

I remember when thinkgeek had a wide variety of genuinely interesting stuff and not just the latest pop culture 'geek' merchandise (sure, they've always had some of that, but years back it wasn't the overriding theme like it is today). This is a sad moment, but probably to have been expected.

gyardley 11y ago

The mainstreaming of 'geek' culture is interesting. It feels like I'm increasingly being targeted - which isn't necessarily a bad thing, because hey, I generally like comic books and video games and light sci-fi / fantasy television shows, and there's a lot more of all of those lately. But why is this happening at this point in time? Is this some sort of response to economic changes in American society? The job market has polarized, with 'geeks' landing on the more attractive side on the divide. Is this a case of an economic domination leading, gradually, to a cultural one? I wonder if strapping on a geeky t-shirt and throwing oneself into geek culture is becoming the equivalent of dressing preppy in the 1980s, with both reflecting higher economic aspirations.

vosper 11y ago
I'm not sure it's a response to economic aspirations. I think it's more that a lot of the things that used to mark one as being a geek have become massively mainstream - owning a computer, owning a smartphone, using the internet, using reddit, using emojis / emoticons, etc... At the same time (possibly it's the same effect) the definition of geek has softened. It's much less pejorative, much less sci-fi and math-club, than it used to be. It's almost trendy. It's certainly been co-opted by marketing and consumer interests. Sort-of related, Simon Pegg wrote an interesting blog post recently [1]. Here's an interesting quote: "[...] this extended adolescence has been cannily co-opted by market forces, who have identified this relatively new demographic as an incredibly lucrative wellspring of consumerist potential. Suddenly, here was an entire generation crying out for an evolved version of the things they were consuming as children. This demographic is now well and truly serviced in all facets of entertainment and the first and second childhoods have merged into a mainstream phenomenon." [1] http://simonpegg.net/2015/05/19/big-mouth-strikes-again/ http://simonpegg.net/2015/05/19/big-mouth-strikes-again/
- toomuchtodo 11y ago
  > At the same time (possibly it's the same effect) the definition of geek has softened. It's much less pejorative, much less sci-fi and math-club, than it used to be. It's almost trendy. It's certainly been co-opted by marketing and consumer interests. I think that's right around the the world found out that if you're a geek, you have leverage (tech skills) are are more likely than the average citizen to have higher than average income (tech workers) or wealth (founders). TL;DR Geeks (we) inherited the modern day economy. "Render unto Caesar the things that are Caesar's, and unto God the things that are God's"

mathgeek 11y ago

Going to be a great opportunity for small geek-centric online retailers to step in and grab some market share. I'm sure I'm not the only one who won't shop at ThinkGeek anymore.

adventured 11y ago

For those unfamiliar, Geeknet had one of the wildest IPO rides in recent history, at the peak of the dotcom bubble: "It was the first time an IPO has ever finished the regular session at above $200 a share on the Nasdaq Stock Market. It meant that in an instant, the stock of the Sunnyvale, Calif., company went from small-capitalization territory to large -- $9.5 billion, or more than half that of Apple Computer." http://www.wsj.com/articles/SB944749135343802895 http://www.wsj.com/articles/SB944749135343802895 "VA Linux Systems took its stock public in an initial public offering (IPO) on 9 December 1999, under the stock symbol LNUX. The IPO offered shares at $30, but the traders held back the opening trade until the bids hit $299. The stock popped up to $320 later in the day, and closed its first day of trading at $239.25—a 698-percent return on investment." http://en.wikipedia.org/wiki/Geeknet#Initial_public_offering http://en.wikipedia.org/wiki/Geeknet#Initial_public_offering And another good story on it: http://www.cnet.com/news/10-years-gone-the-va-linux-systems-ipo/ http://www.cnet.com/news/10-years-gone-the-va-linux-systems-...

libraryatnight 11y ago

Think Geek is mostly just a pop-culture store now, and that's pretty much what Hot Topic is, so this makes sense to me. Think Geek hasn't been focused on 'geeks' in a long time.