31–35 of 35 posts
Earlier quoted context omitted.
A big company can accept that some of its acquisitions won't work out well. Small companies aren't as strong.
So what you're saying is that when it works, the reward is enough to offset the failures. Given this, there is no reason startups should avoid merging simply because it "usually fails" (as the post above was suggesting)... In fact, it's a risk in the same league as doing a startup in the first place.
The risk & reward don't usually work out right (regardless of size). But business development people love them.
You shouldn't always avoid them, you just need to understand the majority fail without the reward to make up for it.
Earlier quoted context omitted.
So what you're saying is that when it works, the reward is enough to offset the failures. Given this, there is no reason startups should avoid merging simply because it "usually fails" (as the post above was suggesting)... In fact, it's a risk in the same league as doing a startup in the first place.
It's enough to offset the failures for a big company if they're any good at acquisition. For a startup the payoff has to be a heck of a lot more. The odds of the merger going bad are higher (too many chefs) and going bad means a total failure of both companies.
The original statement was along the lines of - M&A usually fail, so there is no point in doing this for startups.
Now, maybe being a startup modifies the M&A rules in some or many ways - but I don't think it precludes M&A as a worthwhile option.
A merger in a high risk field might be a tipping factor - might improve your chances or getting a critical mass of users, funding, or some other key factor - so whilst the merger is risky, it modifies the chance of success in some critical way.
In the highly competitive field such as online storage, this kind of advantage may well be something worth pursuing -- I'm not 100% convinced in this case, but it does have some interesting implications.
So - totally agree - might be risky. Might be risky most of the time... But certainly not worth dismissing.
Earlier quoted context omitted.
It's enough to offset the failures for a big company if they're any good at acquisition. For a startup the payoff has to be a heck of a lot more. The odds of the merger going bad are higher (too many chefs) and going bad means a total failure of both companies.
I think we're debating at cross-purposes. The original statement was along the lines of - M&A usually fail, so there is no point in doing this for startups. Now, maybe being a startup modifies the M&A rules in some or many ways - but I don't think it precludes M&A as a worthwhile option. A merger in a high risk field might be a tipping factor - might improve your chances or getting a critical mass of users, funding,…
Earlier quoted context omitted.
Have you encouraged them to join? Dropbox has more customers and awareness. Zumodrive has better technology. They'd be stronger together than apart.
What makes you think it would make sense for two small startups to just "join", especially in this space, where it's not like you can just plug the technology of one into the other.
I'd:
* Rebrand Zumodrive as a future version of Dropbox
* Use Dropbox's syncing model to ensure the local cache is kept up to date to a user-configurable percentage.
This would allow speedy access where the local device has the space, and still allow access where the local device doesn't have the space.