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Big company buys small social company. Several unremarkable years pass. Big company suddenly announces that they are sunsetting/shuttering/selling small company, now much diminished from lack of care and feeding.

Rinse and repeat.

I get that this happens – I get that cultures clash (AOL/TimeWarner, anyone?) and I also get that the initial innovation stagnation problem that prompted the acquisition can end up being the reason it doesn’t work (sometimes we call this an “antibody response” – but that’s another blog post).

All the same, here are two things I liked that acquisitions just wrecked, and one thing that I didn’t much like, but which was wrecked all the same:

1. Delicious. The best thing about this news was how we all found out one of the most popular social bookmarking sites on the web was being shuttered: a cellphone image of a PowerPoint slide taken at a Yahoo! staff meeting. I had to migrate all of my bookmarks to Diigo, and it’s not the same. I have been using Delicious since 2006, people. This is serious upheaval!

[Update: it is possible that Yahoo! may be considering selling Delicious to StumbleUpon - a Big Company acquisition survivor - for as little as one million dollars].

2. MySpace. Okay, I never really cared for MySpace. I’m not sure whether it was the spam-inspired UI or the fact that Tila Tequila was one of the first MySpace personalities to break into mainstream, but damn you, NewsCorp! I thought you actually had a plan – a plan to reach the young kids of today who don’t buy your dead trees! Apparently, not so much.

3. FlipCam. This news came out today. I don’t know why Cisco bought them in the first place (um, video-enabled phones anyone?), but damn – their tech is simple, their editing software elegant. This news made me sad.

So, Big Companies, I know you’re not going to listen, but can you please stop snapping up the stuff I like and then totally wrecking it? Small firms often wither and die within a short time of acquisition unless there is fundamental business alignment, solid strategic direction and an internal executive champion. There must be a better way for you to accelerate innovation that isn’t anywhere near as messy.

Share your examples of big companies buying something really promising in an effort to kickstart innovation, only to have the incredibly persistent “Not Built Here” antibodies smother the spark!

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7 Comments

  1. News Corp buying MySpace? So does that mean you are have no interest of getting acquired?

  2. Maggie Fox Author

    @Umar I’m going to completely ignore your question and say, simply, that SMG will hopefully never be the MySpace to someone elses’ NewsCorp.

  3. Sherief Salem

    You touched on this earlier, but the naming of Arianna Huffington as President/EIC, post AOL acquisition, immediately tarnished the image of tech blogs such as TechCrunch, EnGadget. In blog world, perception is paramount…this move did not help that cause.

    Oh and Rotten Tomatoes seems a lot less rotten since being acquired by Flixster…who the hell wants Fresher Tomatoes anyway??

  4. I didn’t mean to upset you. I wish you luck and I hope you remain an independent shop.

  5. Maggie Fox Author

    @Umar you did not upset me at all! I should have added a smiley face!

  6. Hi, Great post. Never have been a big fan of takeovers or mergers. Not always a good thing or in the best interest of all. Dollar wise it might, but no thanks.

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