Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Ask HN: Do dead YC companies sell their brands/IP?

news.ycombinator.com

Post reply on HN
Print view View original

51–60 of 64 posts

Re: Ask HN: Do dead YC companies sell their brands/IP?

#51

Post by gumby »

neilv wrote: post #4

I'm curious how a failed startups can liquidate IP, since I've seen startups go under with "secret sauce" code that could've been a whole new startup... but assets are sold for a token amount of money to someone who presumably had no idea what they own, since it's never heard from again. (Sorta like when an app startup builds an enabling piece of infrastructure tech, and realizes that's more golden than their origina…

its not uncommon for the founder to buy the IP out of bankruptcy for some token amount, since the technical ip of a filed company is pretty much unusable by anyone who doesn’t know the code base.

I’ve never seen such a company successfully revive, though some get close (for example Tilt5 is selling hardware and doing some interesting license deals, so could make it).

Re: Ask HN: Do dead YC companies sell their brands/IP?

#52

Post by codegeek »

A YC Company is no different than any Business when it comes to failures. Once it has failed, it will either sell its "assets" (very commonly known as Asset Sale), do an acqui-hire or just fold completely because no one wants to buy even their "assets".

I personally was involved in trying to acquire a failed YC product (wont call it company by that time) that was already sold earlier by original founders and the previous buyer was reselling because he couldn't do anything with it. We didn't agree on a price so I walked. At that time, it was already listed for a much smaller value than what a VC would like. Think really small like in the low hundreds of thousands, forget millions.

I also have spoken to a previous YC founder whose startup failed and they basically got acqui-hired and he was really unhappy with how everything turned out. No one remembers their brand name.

As few other comments have already pointed, brand names are overrated especially for failed companies. No one remembers that name because they weren't popular to begin with. Its not like every YC company has a well known brand. Far from it especially nowadays when YC funds so many.

Re: Ask HN: Do dead YC companies sell their brands/IP?

#53

Post by throwawaycities »

codegeek wrote: post #52

A YC Company is no different than any Business when it comes to failures. Once it has failed, it will either sell its "assets" (very commonly known as Asset Sale), do an acqui-hire or just fold completely because no one wants to buy even their "assets". I personally was involved in trying to acquire a failed YC product (wont call it company by that time) that was already sold earlier by original founders and the prev…

Thanks for the comment, (I think) it’s really interesting. I have a bunch of questions about that experience, but limiting to just one:

>At that time, it was already listed for a much smaller value than what a VC would like.

I understand you were in talks with a product not necessarily the entire business or even the brand assets, but can you expand on “listed”? Makes it sound like a public marketplace with a price.

>brand names are overrated especially for failed companies.

I think this is where my post wasn’t clear and misinterpreted. My post is being interpreted as an acquisition for the purpose of trading off the goodwill of the prior business. Whereas, I’m envisioning an acquisition because the dead company has a great name and a portfolio (short branded .com, branded social media handles, trademark) that would be a great name for any business/startup rather than leveraging the goodwill of any prior business operating under that name. For example, I’m just making something but if there were a YC company “telehealth” and they owned Telehealth.com and @telehealth social media handles, there would be plenty of established businesses/startups that would want to acquire that brand portfolio having nothing to do with the prior business.

Re: Ask HN: Do dead YC companies sell their brands/IP?

#54

Post by delfinom »

jmalicki wrote: post #48
neilv wrote: post #11

> Good business names and domains are always in demand, being able to acquire those together with trademarks is even more attractive as a business investment. If branded social media accounts are included, now you have a startup package that many established businesses don’t have. How could you legitimately use the brand name, domain name, or branded social media accounts of a different company? Sketchy SEO could use…

It wasn't YC, and the company is around in other non-handset markets, but Nokia phones sold today are made by an unrelated company that merely licenses the brand name. https://en.wikipedia.org/wiki/HMD_Global#Products_and_Servic...

HMD is basically former Nokia executives and employees though.

Re: Ask HN: Do dead YC companies sell their brands/IP?

#55

Post by delfinom »

dredmorbius wrote: post #39
petesergeant wrote: post #30

Earlier quoted context omitted.

Feels like there’s an opportunity there for a business that will maximise dead tech startup IP

That used to be Computer Associates, now CA Technologies, owned by Broadcom: https://en.wikipedia.org/wiki/CA_Technologies > "Where technology goes to die" was the verbatim description I'd heard of it directly from someone whose former startup had been acquired by them. That's a reasonably widely-held reputation: https://www.theregister.com/2018/07/12/broadcom_ca_technolog... >

Funny because Broadcom is where IP goes to die in general lololol.

Re: Ask HN: Do dead YC companies sell their brands/IP?

#56

Post by dredmorbius »

delfinom wrote: post #55
dredmorbius wrote: post #39

Earlier quoted context omitted.

That used to be Computer Associates, now CA Technologies, owned by Broadcom: https://en.wikipedia.org/wiki/CA_Technologies > "Where technology goes to die" was the verbatim description I'd heard of it directly from someone whose former startup had been acquired by them. That's a reasonably widely-held reputation: https://www.theregister.com/2018/07/12/broadcom_ca_technolog... >

Funny because Broadcom is where IP goes to die in general lololol.

It does seem a poetic fit.

Re: Ask HN: Do dead YC companies sell their brands/IP?

#57

Post by is_true »

neilv wrote: post #11

> Good business names and domains are always in demand, being able to acquire those together with trademarks is even more attractive as a business investment. If branded social media accounts are included, now you have a startup package that many established businesses don’t have. How could you legitimately use the brand name, domain name, or branded social media accounts of a different company? Sketchy SEO could use…

Where I'm from there is a group of companies that buy old brand names to sell generic crap. You can buy shitty Vaio notebooks and some other brands.

Re: Ask HN: Do dead YC companies sell their brands/IP?

#58

Post by brudgers »

throwawaycities wrote: post #9
yawnxyz wrote: post #2

I have no insight, but I always wondered what happens to the $100k+ domains that VC-funded startups buy and then go bust. Do they sell them at a bargain?

Back in the day I read that a lot of the desirable domains used by startups are leased , it would be interesting learn more how that part of the industry actually works.

It’s not an industry. It is an ordinary business practice that makes suing a company less attractive and less lucrative when successful.

Bob controls Acme.LLC and sets up Assets LLC. Assets LLC buys acmellc.com and leases it to Acme LLC for $1,000,000/year. Acme LLC now has less cash assets and no valuable domain name asset to loose in court. In addition there’s a $1,000,000 less net revenue to be distributed as profits among non-controlling Acme LLC shareholders and all that money went to Bob.

Setting up holding companies has been ordinary for many decades and is easy to do. It’s a practice not an industry.

Re: Ask HN: Do dead YC companies sell their brands/IP?

#59

Post by throwawaycities »

brudgers wrote: post #58
throwawaycities wrote: post #9

Earlier quoted context omitted.

Back in the day I read that a lot of the desirable domains used by startups are leased , it would be interesting learn more how that part of the industry actually works.

It’s not an industry. It is an ordinary business practice that makes suing a company less attractive and less lucrative when successful. Bob controls Acme.LLC and sets up Assets LLC. Assets LLC buys acmellc.com and leases it to Acme LLC for $1,000,000/year. Acme LLC now has less cash assets and no valuable domain name asset to loose in court. In addition there’s a $1,000,000 less net revenue to be distributed as prof…

I’m very familiar with IP/asset holding companies, but I am referring to an actual practice within the “domain industry” of leasing domains which is common and not just with high value domains (6-7 figures) but even with 5 figure domains.

Within the domain industry “leasing” is a little misleading because these are typically more like “rent to buy” deals where the original owner continues to retain maintain ownership until the leasee makes the final payment.

Re: Ask HN: Do dead YC companies sell their brands/IP?

#60

Post by brudgers »

throwawaycities wrote: post #59
brudgers wrote: post #58

Earlier quoted context omitted.

It’s not an industry. It is an ordinary business practice that makes suing a company less attractive and less lucrative when successful. Bob controls Acme.LLC and sets up Assets LLC. Assets LLC buys acmellc.com and leases it to Acme LLC for $1,000,000/year. Acme LLC now has less cash assets and no valuable domain name asset to loose in court. In addition there’s a $1,000,000 less net revenue to be distributed as prof…

I’m very familiar with IP/asset holding companies, but I am referring to an actual practice within the “domain industry” of leasing domains which is common and not just with high value domains (6-7 figures) but even with 5 figure domains. Within the domain industry “leasing” is a little misleading because these are typically more like “rent to buy” deals where the original owner continues to retain maintain ownership…

Leasing is leasing. Domains and desks are not very different from the supply side.

My advice is attend a domain leasing industry conference should such a thing exist.

My apologies for previously taking your question at face value and bothering to answer. I did not intend to bruise anyone’s ego.

Post reply on HN