Both. It seems to me in the last 12 months or so, the value of niche online community has skyrocketed. For a company like google, what is the value add of these communities?
I'm not sure how much they paid, though you might be able to find out through crunchbase or something similar.
I think the value it brings to Google is several-fold. I'm probably missing a few, but here's what comes to mind.
1- Brand: Google seems very data scientist friendly. Data scientists will want to use Google technologies because Google is the 'data science' company.
2- Information on trends: Are data scientists suddenly spending a lot of time working in some language, or abandoning another? Are the Kaggle forums overflowing with a lot of Tensorflow related ML problems? Google could use this information to know what decisions to make (bonus: the people who'd curate and analyze the information are probably data scientists).
3- Promote/amplify: Google can hawk the crap out of Google related data science products to that market. And Google can probably provide GCP credits to registered Kaggle users, so that they can spin up their own little server, run their models, and get accustomed to using GCP in the process.
Those are just some thoughts. They likely have even better plans!
Pretty hard to know unless someone has inside knowledge.
You can take a point of reference from the funding history - https://www.crunchbase.com/organization/kaggle#/entity
$11M Nov 2011 followed by 1.75M in Sept 2015. The first was an amazing raise for their stage. Obviously pretty smart people and an area people wanted a part of . Appears the later was a bridging round as it's been tagged Series A like the first.
That was 7 of 20 roles. They're now more like ~80 employees, according to LinkedIn. However, admittedly a lot aren't tagged right (investors, advisors, interns and people associated with Kaggle). Either way, appears the pivot in 2015 worked.
So you can straight-line from there. That's circa 3-5x employee growth over 3 years, which you can conjecture at least has a relationship with actual growth. That's not too shabby either. With growth over that timeframe and stage you'd probably be more interest in the story over the last 6-12 months, which is harder to gauge. It may have plateaued, it may have spiked.
So if you anchor the Series A at, say, 20% of the value. Then multiply out growth, then put a multiple on that you're looking at 100 at the low end and maybe 500 at the high-end. Likely somewhere square in the middle.
To me that sounds optimistic. A bearish view would be that they limped to enough revenue to cover the costs of operating a solid recruiting and contest site; non recurring revenue of, say, $15MM without a strong growth or margin story.
Kaggle was a great recruiting play; given that Google bought them, and not a recruiting company, I would bet that this is an acquihire.
If they were covering costs at 15M+, that's not too bad and a pretty serious business. You'd hope for a multiple on that (and the investors would be wanting some level of return too). So for met that puts me a the bottom of my range (~6x multiple).
You're right though, they may have just hit a ceiling and the multiple could be a lot lower. I was taking a bit of a punt on what I saw. You've also got to consider the cash component, earn-outs, etc. If you put all that together the 6x or more doesn't seem off-base. It's also the kind of setup that might have multiple people interested in acquiring them.
Another more positive read on "ceiling" is that is they wanted to execute on a bigger vision and the Google acquisition gave them the platform to do so.
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[ 12.6 ms ] story [ 68.5 ms ] threadI think the value it brings to Google is several-fold. I'm probably missing a few, but here's what comes to mind.
1- Brand: Google seems very data scientist friendly. Data scientists will want to use Google technologies because Google is the 'data science' company.
2- Information on trends: Are data scientists suddenly spending a lot of time working in some language, or abandoning another? Are the Kaggle forums overflowing with a lot of Tensorflow related ML problems? Google could use this information to know what decisions to make (bonus: the people who'd curate and analyze the information are probably data scientists).
3- Promote/amplify: Google can hawk the crap out of Google related data science products to that market. And Google can probably provide GCP credits to registered Kaggle users, so that they can spin up their own little server, run their models, and get accustomed to using GCP in the process.
Those are just some thoughts. They likely have even better plans!
You can take a point of reference from the funding history - https://www.crunchbase.com/organization/kaggle#/entity $11M Nov 2011 followed by 1.75M in Sept 2015. The first was an amazing raise for their stage. Obviously pretty smart people and an area people wanted a part of . Appears the later was a bridging round as it's been tagged Series A like the first.
They laid off 1/3 staff earlier in 2015: https://www.wired.com/2015/02/data-science-darling-kaggle-cu...
That was 7 of 20 roles. They're now more like ~80 employees, according to LinkedIn. However, admittedly a lot aren't tagged right (investors, advisors, interns and people associated with Kaggle). Either way, appears the pivot in 2015 worked.
So you can straight-line from there. That's circa 3-5x employee growth over 3 years, which you can conjecture at least has a relationship with actual growth. That's not too shabby either. With growth over that timeframe and stage you'd probably be more interest in the story over the last 6-12 months, which is harder to gauge. It may have plateaued, it may have spiked.
So if you anchor the Series A at, say, 20% of the value. Then multiply out growth, then put a multiple on that you're looking at 100 at the low end and maybe 500 at the high-end. Likely somewhere square in the middle.
That's guesswork, but gives a ballpark view.
Kaggle was a great recruiting play; given that Google bought them, and not a recruiting company, I would bet that this is an acquihire.
If they were covering costs at 15M+, that's not too bad and a pretty serious business. You'd hope for a multiple on that (and the investors would be wanting some level of return too). So for met that puts me a the bottom of my range (~6x multiple).
You're right though, they may have just hit a ceiling and the multiple could be a lot lower. I was taking a bit of a punt on what I saw. You've also got to consider the cash component, earn-outs, etc. If you put all that together the 6x or more doesn't seem off-base. It's also the kind of setup that might have multiple people interested in acquiring them.
Another more positive read on "ceiling" is that is they wanted to execute on a bigger vision and the Google acquisition gave them the platform to do so.
All I can tell you is the exit was at around 12 MIL. Ca$h and a small amount of stocks for a few stellar engineers (I think 7 or so).
This was an Acqui-hire. From what I hear, Google was pursuing some individuals for over 2 years.
Sorry, don't ask me follow up questions.