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Posts published in “mike krieger”

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Facebook poisons the acquisition well

Who should you sell your startup to? Facebook and the founders of its former acquisitions are making a strong case against getting bought by Mark Zuckerberg and Co. After a half-decade of being seen as one of the most respectful and desired acquirers, a series of scandals has destroyed the image of Facebook’s M&A division. That could make it tougher to convince entrepreneurs to sell to Facebook, or force it to pay higher prices and put contractual guarantees of autonomy into the deals. WhatsApp’s founders left amidst aggressive pushes to monetize. Instagram’s founders left as their independence was threatened. Oculus’ founders were demoted. And over the past few years, Facebook has also shut down acquisitions, including viral teen Q&A app TBH (though its founder says he recommended shutting it down), fitness tracker Moves, video advertising system LiveRail, and still-popular mobile app developer platform Parse. [Correction: Voice control developer tool Wit.ai has not shut down, just its Bot Engine.] Facebook’s users might not know or care about much of this. But it could be a sticking point the next time Facebook tries to buy out a burgeoning competitor or complementary service. Broken promises with WhatsApp The real trouble started with WhatsApp co-founder Brian Acton’s departure from Facebook a year ago before he was fully vested from the $22 billion acquisition in 2014. He’d been adamant that Facebook not stick the targeted ads he hated inside WhatsApp, and Zuckerberg conceded not to. Acton even got a clause added to the deal that the co-founders’ remaining stock would vest instantly if Facebook implemented monetization schemes without their consent. Google was also interested in buying WhatsApp, but Facebook’s assurances of independence sealed the deal. WhatsApp founder, Brian Acton, says Facebook used him to get its acquisition past EU regulators WhatsApp CEO Jan Koum quits Facebook due to privacy intrusions WhatsApp’s other co-founder, Jan Koum, left Facebook in April following tension about how Facebook would monetize his app and the impact of that on privacy. Acton’s departure saw him leave $850 million on the table. Captivity must have been pretty rough for freedom to be worth that…

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