Ask HN: Examples of large acquisitions that did not ruin the acquired company?
By "ruin" I mean the less tangible parts of the smaller company, such as the culture, the enthusiasm and spirit, the flexibility, the overall happiness.
Having now been in two medium-sized companies that have been acquired by large, public firms, I find that everything we enjoyed is gone. Perks slowly disappear; meetings, trainings, and general wastes of time increase; productivity slows; engineers become demoralized; processes grind through bureaucracy. As I understand it, this is typical.
What are some examples where acquisitions like this have happened and the smaller company wasn't essentially destroyed?
172 comments
[ 3.2 ms ] story [ 258 ms ] threadThis is a very special case though! Tableau is a company with a lot of Fortune 500 buy-in, but an aging development stack and business model. So this is the case of a somewhat more dynamic larger company acquiring a set of customers and some fundamental tech.
Usually acquisitions are from big/slow/established/monopoly acquiring an upstart and it’s no surprise that usually ends up badly.
Now, these could all have very well been in development before the acquisition, but as a whole, the capabilities have grown tremendously since that time.
Also, it seems like the licensing options for smaller businesses has really been focused on since the acquisition. It's become much more affordable for a small business to get and use Tableau compared to 4-5 years ago.
There are cases where the acquired company is left to run more-or-less independently, and its stock is just owned (or majority-owned) by the acquirer. But that's probably the exception rather than the rule. Usually, if you get acquired, you're now an employee of Big Co.
We've done a number of acquisitions - and most seem to have done well. A big portion of that is recognizing that you are not only acquiring the company - it's IP and people - but also it's culture. If you don't want that culture - if it's not better then yours, you don't want it.
The Objective-C Cocoa APIs are a straight descendant of the NeXTStep APIs, and many NeXT apps would run on OS X with a simple recompile. While there have been many additions since, and the main focus these days is on the Swift language, to the best of my knowledge, you can still take an Objective-C NeXT application and compile it on your ARMintosh and have it run with very few issues.
I was a Mac user from 1989, and I didn't like OS X much at the time. It felt like a completely new system, not an update to what I was used to. Sure, it was better in many technical ways, but it was also a lot more complicated. And it felt different. So there were was definitely a sense that it was really a Mac anymore.
Just about the only technical concession to the old Mac crowd that I can think of was the use of the old HFS+ file system, over NeXT's UNIX filesystem. And I think this was only because there was a transition period of several years where dual-booting was common, even necessary. So you could install OS X next to your old OS 9 system and boot either at your discretion without having to have several partitions. Mac OS9 is very dependent on some features in its FS, so this was the only way to allow a smooth transition. But other than that, OS X was and felt like a new, alien system, even though it did allow for compatibility with many applications.
Also, early versions of OS X (IIRC though 10.4) were perfectly happy to install and work on UFS, the installer would even help you do so.
From the user end, the problem with running OSX on UFS was that... a bunch of sloppy software broke on case-sensitive volumes. Famously, Adobe's entire suite wouldn't even install on case-sensitive volumes (see https://helpx.adobe.com/creative-suite/kb/error-case-sensiti... I think it's still unfixed to this day). This is probably also the reason why despite Apple finally getting a modern file system... APFS has and defaults to a case-insensitive mode in opposition to essentially every other modern FS.
Fun times!
Steve drove (Chief Operating Officer) Marco Landi and (chief technologist) Ellen Hancock out even before he became CEO. Bertrand Serlet (1997-2009) then Craig Federighi (2009-) ran the (variously named) OS team and Avie Tenivan was the tech lead, all former NeXT folks (which makes sense because Apple failed at 3 OS projects then shipped reskinned NeXTStep). Bud Tribble followed Steve to NeXT then back to Apple in various VP roles. George Crow and Jon Rubinstein did the same kind of loop working on hardware platforms at Apple-NeXT-Apple. Mitch Mandich became SVP of sales almost immediately after the acquisition. Etc.
Seems like Pixar is doing well and Disney is taking influence from them
Pixar used to work on one movie at a time, and each one that came out was technologically ground breaking[1], a huge media event, and an instant classic beloved by adults and children.
Now days you have https://www.imdb.com/list/ls020738923/
Some of their movies are good, some are great, some aren't good, but now days they are willing to make cash grab sequels.
[1] Siggraph during Pixar release years turned into "what ground breaking tech did Pixar invent this time"
https://qz.com/1754288/disney-is-trying-to-revolutionize-fil...
https://www.youtube.com/watch?v=bErPsq5kPzE
Though how much of that is Disney and how much is the companies they worked with is unknown to me.
Where Disney is now is more about destroying the parks as cultural touchstones in the USA.
Instagram specifically has just become another ad infested shopping app for me these days.
The first time I was in a company that got acquired, this happened. Then it got acquired again by an even bigger fish and it didn't really happen because it already sucked after the first time.
The second company that got acquired it also happened. Usually the suck starts after a year when managers try to increase their bonuses by finding "synergies," which really means cutting employees through consolidation and adding a bunch of unnecessary friction to the development process.
The lesson I've learned is if you get acquired, you've got about a year to get out or you will be miserable if you aren't the big-co type. I made the mistake of staying too long both times it's happened to me.
To answer your question, I've never been at a company that got acquired and it was better for me.
Nobody cares about this, the money they make isn't what other people interact with. It's the things they create.
Counter-counterpoints:
Cars 2, Brave, Monsters University, The Good Dinosaur, Finding Dory, Cars 3, Coco, Onward, Luca, Turning Red, Lightyear.
The (not very original) point is: You can no longer count on a Pixar movie being excellent.
But yeah you have a good point. They retained their culture and in fact spread it further by having the Pixar folks take over Disney Animation.
As long as we're doing Disney acquisitions, Lucasfilm is also still pretty independent and successful. Other Disney acquisitions have been less so.
LucasArts (now known as Lucasfilm Games)... tell that to the games that were put on hold and then eventually cancelled upon acquisition.
I know there is a lot of Oracle hate but: MySQL, GraalVM (Java), Sun hardware (both Exa* and SPARC), VirtualBox and many more technologies are better today than prior.
The challenge Sun would have had, regardless of Oracle or not, is that they were solidly in the On-Prem business ... and the market has moved to Cloud.
Nothing destroyed. Just differences in company culture.
The alternative for Sun was IBM to buy them. An acquisition by IBM would have been the death of Sun. Sun, under Oracle, still lives on well today.
https://abcnews.go.com/amp/Technology/story?id=7395780&page=...
Which is what this thread is largely about.
Because a # of the examples given are parent companies just leaving the acquired company alone in isolation.
How is that good for either the acquirer or the consumers.
No synergies can be had if the two companies are operating independently.
Usually when a company is acquired, certain unique (and attractive) features of its company culture die pretty fast.
These can be measurable things eg: PTO policies, imposing certain dev environments/corp machine policies on devs, bonus structures, conference/training allowances, frequency and structure of meetings, etc.
Or these can be more vague things, like shifts in how internal comms work, the death of informal means of resolving issues, incremental shifts in management style, etc.
The last acquisition I went through (as an employee of the acquired company) resulted in about half of my team leaving pretty quick. The acquirer basically took away all the perks that made working there worthwhile (compared to any given competitor).
If my current employer was to be acquired, I'm willing to bet that the entire staff of the business unit I'm part of will be looking for new jobs, as I doubt the acquirer would be giving us the degree of freedom that we have currently.
A lot of telecoms stuff.
> Who's using Virtualbox over HyperV, Libvirt or VMWare?
A considerable number of people who want an open source virtualization solution that is relatively painless to use (so, not libvirt).
It took a few years to find its footing, but Oracle has really given Java the space and resources to thrive. The roadmap is fuller than it ever has been and the release cadence continues to deliver value. Check out projects Amber, Loom, Panama, Valhalla. Tap into the stream of Inside.java. Exciting times.
Point being, I believe Java is a datapoint for successful product acquisition.
"In the Plex" by Steven Levy goes into great detail on how YouTube could not survive its growth without the infrastructure and ad technologies Google brought to the platform.
I think it does, otherwise OP's question is ill-posed. That is, if YouTube scaled independently from a scrappy startup to a $170billion behemoth, the changes in corporate governance and culture would have been equally as drastic as being acquired by Google.
Bad actors creep in, which creates new rules, which negatively impacts the whole, which causes resentment, which causes more bad actors, which lead to more rules, and before you know it, review-girls don't seem so bad when your feed lands on terrorist-mickeymouse and the syringe babies.
Culture: there's different people around, now. So culture necessarily changes.
Flexibility: bigger companies are less flexible because there are simply more people. Even if every individual is more flexible, it doesn't matter.
Enthusiasm, spirit, and happiness - are these not synonyms, in this context? And if they are, are they not reactions to external factors (culture & flexibility)?
I would suggest your question may be tautological: big companies will always ruin small companies from the perspective of someone who likes small companies because the small company became big.
The whole episode is brilliant, full of great insights that I think about often. It's well worth a listen.
[1] https://www.joincolossus.com/episodes/34646260/collison-grow...
[2] https://en.wikipedia.org/wiki/Constellation_Software
This company does decent M&A in the auto ancilliaries industry
- AbeBooks (acquired by Amazon in 2008)
- Book Depository (acquired by Amazon in 2011)
These companies don't appeared to have changed dramatically from when Amazon bought them. I wonder if these companies operate 'independently' without too much undue influence from Amazon?
[0]https://en.wikipedia.org/wiki/Mobipocket
Maybe Github Actions has brought in a lot more revenue, too. They get a "discount" on Azure hosting, I'm sure.
However, all jests aside, being a relatively open source person, I haven't seen much in the git product of Github getting any worse after Microsoft acquired them. The social aspect, well, it is what it is, and I don't care for it, but I don't necessarily think my preferences translate well to a quarterly earnings call.
I do personally perceive the downtime to be more frequent now, but maybe only because it's more publicized, I do not have any data to substantiate that personal observation.
However their reliability is down the toilet. So a mixed bag, IMHO.
It's a genuine question, I'm not being sarcastic, I really don't understand the statement (which seems to be shared by several people here). I honestly can't point out a single thing that was delivered that changed the game for like, 6 years from now if not more (copilot is a nice gadget IMHO but it's not really game changer, is it?).
I was actually hoping that MS support would change that, but I don't see it happening.
Maybe these changes are incremental, maybe you don’t cherish them as much as I do ,and some were very much over due. Regardless, I like them and am impressed by Github’s recent work.
Reliability went way down after the acquisition.
It feels like we constantly have issues with github, it's becoming as bad as azure.
Actions, Packages and Projects (beta) are nice product ideas but they are a nightmare of DX experience.
You can see they rushed them out to compete with Gitlab.
Also dodgy stuff like Copilot.