Facebook acquires instagram infographic9/13/2023 ![]() The basic plan would be to buy these companies and leave their products running while over time incorporating the social dynamics they’ve invented into our core products. 3) integrate their products with ours in order to improve our service? This can be a very compelling reason, if you have a clear vision for how the implementation would be great for users and that we cannot do the product improvements ourselves in a reasonable timeframe. 2) acquire talent? Seems expensive for this. We have to win against competitors by having better products. We will always have upstarts nipping at ow heels. There will always be consumers who are instinctively negative about the industry leaders and want to work with the upstarts. 1) neutralize a potential competitor? Bad reason in my book since someone else will spring up immediately in their place. ![]() I would ask you to find a compelling elucidation of what you are trying to accomplish. they would rather do something than nothing, and M&A seems like the biggest lever they have. My instinct is that many deals are done because the CEO is frustrated that the business is not where they want it to be. All the research I have seen is that most deals fail to create the value expected by the acquirer. I tend to have a high bar for M&A considerations. Given that we think our own valuation is fairly aggressive right now and that were vulnerable in mobile, I’m curious if we should consider going after one or two of them. These entrepreneurs don’t want to sell (largely inspired our success), but at a high enough price - like $500m or $1b - they’d have to consider it. The businesses are nascent but the networks are established, the brands are already meaningful and if they grow to a large scale they could be very disruptive to us. Fast growth, a small team (10-25 employees) and no revenue. These companies have the properties where they have millions of users (up to about 20m at the moment for Instagram). One business questions I’ve been thinking about recently is how much we should be willing to pay to acquire mobile app companies like Instagram and Path that are building networks that are competitive with our own. The emails reveal how Zuckerberg viewed the mobile app space in 2012, and what his motivations for acquiring Instagram were. In a series of emails revealed during the latest US Congressional Hearings, Facebook CEO Mark Zuckerberg discusses the acquisition of Instagram with Facebook’s CFO David Ebersman. But while the latest Congressional hearing of tech CEOs has put the focus on the power that companies like Facebook, Google, Amazon and Apple have been amassing, it also provided a rare glimpse into their internal workings. The internal machinations of large tech companies are opaque for the most part - the ordinary public often doesn’t know the story that goes behind the business decisions, the mergers and acquisitions, and negotiations that are worth billions.
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