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Salesforce Buys Heroku (YC W08) For $212 Million In Cash

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Re: Salesforce Buys Heroku (YC W08) For $212 Million In Cash

#111

Post by hackinthebochs »

papertiger wrote: post #96

I've honestly never understood why startups want to be acquired (besides the monetary gain for individual employees). Doesn't acquisition often destroy or dilute the very successes they've worked so hard to build? (I worked for an acquisitive company that worsened nearly every product/company it acquired.) Why not just focus on making your business better? Heroku will now be subject to all kinds of pressures and asin…

Despite what gets repeated in the echo chamber that surrounds hackernews that money isn't the main motivator for entrepreneurs and hackers, it is in fact all about the money.

Of course, day-to-day it has to be about much more than money otherwise it would be impossible to stay motivated. But the end goal is almost always about making a boatload of cash.

Re: Salesforce Buys Heroku (YC W08) For $212 Million In Cash

#112

Post by notyourwork »

yesno wrote: post #102
hopeless wrote: post #28

This sounds like stellar news for Heroku employees and investors. I'm not sure how it's going to be good for Heroku customers (like me) in the long-term. There will be the inevitable brain drain over the course of 1-2years when key staff move away as their contract clauses run out and then we'll be left with Heroku being run by SalesForce :(

Nothing last forever. Eventually all the "startups that you love" will either close their door or be acquired and I think people should expect that since day 1.

Google? I do not recall them being "acquired".

Re: Salesforce Buys Heroku (YC W08) For $212 Million In Cash

#114

Post by vidar »

vidar wrote: post #45
maxer wrote: post #5

pg hit the home run on this one

I don't think pg will consider an exit a home run until it exceeds 1B.

Since people seem to dislike my comment, I will explain my point. "A home run" means "ultimate success", you can not expect to do any better than that. Since pg has openly stated that he is looking for the next Google/Facebook type company, 212 million is not "a home run". Its still pretty good!

Re: Salesforce Buys Heroku (YC W08) For $212 Million In Cash

#115

Post by jey »

papertiger wrote: post #96

I've honestly never understood why startups want to be acquired (besides the monetary gain for individual employees). Doesn't acquisition often destroy or dilute the very successes they've worked so hard to build? (I worked for an acquisitive company that worsened nearly every product/company it acquired.) Why not just focus on making your business better? Heroku will now be subject to all kinds of pressures and asin…

I see two main reasons:

- Freedom to move on to the next project. I bet most entrepreneurs are more interested in creating than maintaining.

- Money/security. The trend toward payouts when raising major rounds is helping with this issue, but still the resources available change significantly with a big payout, plus you can diversify your income stream to hedge against contingencies.

Re: Salesforce Buys Heroku (YC W08) For $212 Million In Cash

#117

Post by rikthevik »

tamersalama wrote: post #106
yesno wrote: post #102

Earlier quoted context omitted.

Nothing last forever. Eventually all the "startups that you love" will either close their door or be acquired and I think people should expect that since day 1.

Why are these the only 2 outcomes? Why not grow a business?

I guess it depends what kind of investors they've taken on, and how eager they are for a big money exit.

Re: Salesforce Buys Heroku (YC W08) For $212 Million In Cash

#118

Post by jdludlow »

vidar wrote: post #114
vidar wrote: post #45

Earlier quoted context omitted.

I don't think pg will consider an exit a home run until it exceeds 1B.

Since people seem to dislike my comment, I will explain my point. "A home run" means "ultimate success", you can not expect to do any better than that. Since pg has openly stated that he is looking for the next Google/Facebook type company, 212 million is not "a home run". Its still pretty good!

I think the phrase you are looking for is "grand slam."

Re: Salesforce Buys Heroku (YC W08) For $212 Million In Cash

#119

Post by space-monkey »

papertiger wrote: post #96

I've honestly never understood why startups want to be acquired (besides the monetary gain for individual employees). Doesn't acquisition often destroy or dilute the very successes they've worked so hard to build? (I worked for an acquisitive company that worsened nearly every product/company it acquired.) Why not just focus on making your business better? Heroku will now be subject to all kinds of pressures and asin…

I currently design new products for an established company. When I finish a product, there's a trained staff of production, sales and support people that make the product successful. (Just speculating but) it's quite possible that the Heroku folks think they can't grow as fast without some additional business infrastructure. If this accelerates their trajectory, then they'll quickly get some distance between themselves and the zoo of other (not as slick) app hosting platforms. Just having someone else to take care of the legal side of HR so that you can go back to product development, while at the same time putting enough in the bank to live on the beach forever, may have looked attractive. Lots of possibilities, but a billion dollar cash-out is not the only way to make yourself happy in life.

Re: Salesforce Buys Heroku (YC W08) For $212 Million In Cash

#120

Post by dasil003 »

hristov wrote: post #33
plinkplonk wrote: post #18

This is great news for Heroku and YC (congratulations folks!). That said, does anyone have any insights on why exactly SalesForce would buy Heroku? What is the business rationale? "This is Salesforce’s fifth acquisition this year. Earlier purchases include Activa Live, Sitemasher and Jigsaw. Salesforce.com also spent $170 million to fully acquire its Japanese subsidiary, Salesforce Japan." Anyone see a pattern? I don…

One can make a pretty good case that Heroku and the like is where all web development is headed pretty soon. One thing that can be gleaned from the history of languages and computing platforms is that once computing performance started skyrocketing, it has been the easiest languages and platforms that have been winning. And RoR is very easy and Heroku is a very easy way to deploy and host RoR. If Heroku becomes the p…

The Heroku model is not ideal for commercial apps, it's good for very small apps, but if you scale up it's not cost effective at all. Things that would take a half-hour to setup with puppet on amazon become add-ons that you have to pay large ongoing fees for. Instead of investing in building out infrastructure optimized for your application where you have options on how to grow, you're shoe-horned into a one-size fits all model, that starts out cheap, but has a built-in premium which becomes more and more painful the larger you grow. We host our app on Engine Yard AppCloud which is considerably more open in that they give you access to the cloud "metal" but even there the clock is ticking to where it just makes more sense to hire a full-time systems engineer and build it out ourselves.

Don't get me wrong, I understand the value proposition of a highly tuned blackbox Rails stack, and there is certainly no faster way to get up and running. So it may become the place to be for early stage startups and prototypes. But the particular model that Heroku has is sort of like the Drupal of infrastructure: it's an amazing platform that has everything you need out of the box, but which also comes with a lot of baggage that can easily become an albatross when you are really trying to dial in a growing app.

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