Re:IBM’s Watson Health is sold off in parts
by thomasahle on Sunday January 23, 2022 @01:02PM
(#30048496)
> This goes hand-in-hand with an over-heated sales team pushing hockey-stick growth
This seems like just another argument for limiting startup acquires. Perhaps if a big exit wasn't the goal, the company would focus on more long term viability.
Anyway, I don't think they big companies care as much about whether they destroy value, as long as they destroy a potential competitor.
Re:IBM’s Watson Health is sold off in parts
by jahewson on Sunday January 23, 2022 @01:20PM
(#30048728)
I see competition often being less about the startup and more about which other competing big tech company could buy the startup to consolidate an existing market strategy. I’d more charitably call it “revenue protection” to preemptively acquire them.
Startup acquisitions, in the absence of astoundingly deep due-diligence should probably be placed in portfolios where a 5:1 failure rate can be tolerated. I’m not sure how such an acquisition would be compensated.
Nice payday for the founding team and the ticking time bomb is paid for out of bigcorp’s wallet. They go on to great new things and the eventual demise of their garbage pile will be blamed on bigcorp.
Not to say that large companies don’t destroy value - they absolutely do, frequently - but that the main error they make is not being able to appraise which startups are smoke and mirrors and which are legit. The rest of us are not so great at it either.