This was a sale of near last resort. This was not a "win" or an "exit" by any measure.
Did they really burn through their $4.85M from their Series C in 6 months?
Facebook Acquires Drop.io
21–30 of 55 posts
Re: Facebook Acquires Drop.io
#22It took the longest time for me to understand what Drop.io did. And during most of that time I was a NYC entrepreneur.
It's hard to build a real company if no one understands what you do. Maybe they would have had a better outcome had they hired a CEO who could create & communicate a cohesive vision.
But that's just me.
Re: Facebook Acquires Drop.io
#23Facebook's recent talent acquisitions sort of make sense to me from Facebook's standpoint (good, entrepreneurial talent is hard to find), but I wonder how the founders, employees, users, and investors feel about these relatively odd buyouts. This drop.io deal sounds a lot like the Hot Potato acquisition from a few months ago: in both cases the startups were well-funded, but didn't have much traction, and then Faceboo…
As a user it's definitely somewhat disheartening. It seems like whenever something cool/useful comes from a small, previously unknown team, there's a significant chance that it'll just be bought and killed by a big player. Both makes me more wary of relying on such services to begin with (even if they're paid!), and from a progress-of-technology perspective feels unfortunate. I'm sure it's great for the founders, but it's like big companies are using their cash pile to do the opposite of encouraging technological progress: find technological progress elsewhere, buy it, and axe it.
Things do occasionally turn out okay, e.g. Google allowed the EtherPad team to open-source the code after Google bought/killed it. And, although I don't personally use/like it, Dodgeball got more or less resurrected as FourSquare after Google bought/killed it.
Re: Facebook Acquires Drop.io
#24This was a sale of near last resort. This was not a "win" or an "exit" by any measure.
Did they really burn through their $4.85M from their Series C in 6 months?
If you are burning $500,000/month, which is not unreasonable, then you get 10 months with $5mm.
If you haven't turned the corner after 5 months, you know you won't get out of the hole before you run out of cash.
Therefore, you sell the company and reduce your burn as much as possible to make a sale happen.
If your sale is all about talent and not the technology there is almost no due diligence required and a deal can happen quickly, in about a month.
Re: Facebook Acquires Drop.io
#25Facebook's recent talent acquisitions sort of make sense to me from Facebook's standpoint (good, entrepreneurial talent is hard to find), but I wonder how the founders, employees, users, and investors feel about these relatively odd buyouts. This drop.io deal sounds a lot like the Hot Potato acquisition from a few months ago: in both cases the startups were well-funded, but didn't have much traction, and then Faceboo…
I have a suspicion - based purely on speculation - the unspoken thing here is that most of these businesses had awesome products & teams but were hurting so badly financially that they were on their last breath.
I wouldn't be surprised if its more of a case of struggling but very smart startup, about to collapse, turns to facebook as a last resort liquidation move. Handing over to FB or Google and having them pay back some investors and shut down the service looks much better than sending out a solemn "we screwed up" email to all your users & stakeholders...
Re: Facebook Acquires Drop.io
#26Congrats to Drop.io. In 2007 I presented my start-up at the New York Tech Meetup (http://www.businessinsider.com/2007/11/nytech-meetup-at-iac). It was an odd meetup as only two unknown start-ups presented that evening, mine and a complete unknown, Drop.io who launched at the meetup. Other presenters were established companies presenting new products.
Re: Facebook Acquires Drop.io
#27Facebook's recent talent acquisitions sort of make sense to me from Facebook's standpoint (good, entrepreneurial talent is hard to find), but I wonder how the founders, employees, users, and investors feel about these relatively odd buyouts. This drop.io deal sounds a lot like the Hot Potato acquisition from a few months ago: in both cases the startups were well-funded, but didn't have much traction, and then Faceboo…
As a user it's definitely somewhat disheartening. It seems like whenever something cool/useful comes from a small, previously unknown team, there's a significant chance that it'll just be bought and killed by a big player. Both makes me more wary of relying on such services to begin with (even if they're paid!), and from a progress-of-technology perspective feels unfortunate. I'm sure it's great for the founders, but…
Time to checkout Tonido http://news.ycombinator.com/item?id=1849607
Re: Facebook Acquires Drop.io
#28seems like just a talent acquisition to me
It's sad that founders do this kind of thing to their users. Why not sell the company to Facebook (with attendant personnel agreements), but sell the assets (users, technical infrastructure) to a competitor at a steep discount, maybe in exchange for shares? That way their users have a fighting chance at a smooth transition, and the technical contribution you made can continue.
I agree. As more and more services close, customers will be wary of putting content online or using a public online service. Thats the reason we started Tonido.
Re: Facebook Acquires Drop.io
#29Hm, someone just asked me this week if their data will last on Drop.io--I told them yea for sure, they've been around for a long time, they're not just gonna shut down all of a sudden.
And then this.
Re: Facebook Acquires Drop.io
#30A replacement for Drop.io is already in the works, I imagine. (And Dropbox won't cut it for a lot of people; it's not as straightforward to do a simple fileshare, and there are other cool features [e.g. RSS] that Dropbox doesn't do.)
Dropbox does actually offer an RSS feed with file changes in your public folder.