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Lina Khan points to Figma IPO as vindication of M&A scrutiny

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Re: Lina Khan points to Figma IPO as vindication of M&A scrutiny

#51

Post by elefanten »

tptacek wrote: post #37
timr wrote: post #27

Earlier quoted context omitted.

yep. So perhaps don’t block every potential transaction on flimsy pretense? Icing the transaction market seems like a great way to scare off potential competing acquirers in the name of social engineering. I don’t know. All I know is that Lina is out of power, and suddenly we see an upswing in M&A. Coincidence, I’m sure.

I'm not a Khan fan, like, at all, but by the time you're at the point where the FTC is getting involved in your M&A, you've crossed the threshold of success; all the signals to future startups about your path being promising have been sent.

I agree with your general point, but Khan was excessively trigger happy in a way that highlights exceptions to your observation. E.g. blocking Meta acquisition of Within was nonsense that did nothing to validate the concept of VR fitness as a promising category (anytime soon)

Edit: Within, not Withings

Re: Lina Khan points to Figma IPO as vindication of M&A scrutiny

#52

Post by ptero »

wat10000 wrote: post #41
alephnerd wrote: post #35

Earlier quoted context omitted.

Except the majority of the Figma IPO was captured by banks due to it's severe pop. So while everyone made a lot of money, the overwhelming majority went to the underwriters [0]. The founding team at Figma would have gotten a similar amount much sooner if the acquisition was let thru OR if the underwriters didn't screw them over by underpricing at $33. [0] - https://pitchbook.com/news/articles/figma-ipo-pop-spotlight-…

Why don’t more IPOs do an auction to set the price? Trying to determine the “right” price ahead of time seems like a really bad way to do things.

An auction for IPO price is much easier to manipulate and can lead to much volatility. Pre-allocating to the entities that are not expected to sell quickly or participate in pump-and-dumps (pension funds, etc.) is considered a better long term strategy for the company, as the sister comment says.

Re: Lina Khan points to Figma IPO as vindication of M&A scrutiny

#53

Post by andrewmcwatters »

Invictus0 wrote: post #49
oooyay wrote: post #36

My experience with mergers and acquisitions is that it's akin to keeping a warm body on life support. When I worked at a company that did a lot of M&A I was sitting around like, "Why couldn't you have just built that?" When I worked at a company that was recently acquired and went through the merger process I was like, "wow I see why you bozos would've never built this yourselves." That isn't to say there aren't comp…

[flagged]

Adobe XD, C#, Microsoft Teams…

Re: Lina Khan points to Figma IPO as vindication of M&A scrutiny

#54

Post by zenmac »

Invictus0 wrote: post #49
oooyay wrote: post #36

My experience with mergers and acquisitions is that it's akin to keeping a warm body on life support. When I worked at a company that did a lot of M&A I was sitting around like, "Why couldn't you have just built that?" When I worked at a company that was recently acquired and went through the merger process I was like, "wow I see why you bozos would've never built this yourselves." That isn't to say there aren't comp…

[flagged]

Not for no reason at all, just not economical or innovative or supporting the customers.

It is all a dog and pony show now to chase the investors while centralize and concentrate wealthy in the hands of very few.

Edit: do think we ought to promote using Penpot type of alternative to proprietary counter part.

Re: Lina Khan points to Figma IPO as vindication of M&A scrutiny

#55

Post by bix6 »

jeffbee wrote: post #39
xrd wrote: post #38

Earlier quoted context omitted.

I stopped reading when they defended Albertsons and Kroger merger. Can anyone defend the consolidation of grocery stores with a straight face? Walmart has obliterated any competition and it has destroyed local food sources everywhere. They can do it at scale that no one can compete with. If the only solution is to further consolidate then we might as well just hand over the government to Walmart.

And yet, groceries have never been cheaper. So the question becomes which do you want: consumer benefits, or your aesthetic preferences regarding how big a company should be?

Groceries were cheapest around 2000 and have gotten more expensive since? Particularly 2020 on

Re: Lina Khan points to Figma IPO as vindication of M&A scrutiny

#57

Post by bee_rider »

bryant wrote: post #20
sealeck wrote: post #12

Earlier quoted context omitted.

That if Amazon acquired it, this would enable it to horizontally integrate and take control of yet another market? This, eventually, woudl lead to lower prices for consumers...

> This, eventually, woudl lead to lower prices for consumers... What incentive would Amazon have to drop prices after vertical integration is done?

This is sarcasm, right? The “eventually,” the ellipses, and the underlying ridiculousness lead me to believe it is sarcasm.

Re: Lina Khan points to Figma IPO as vindication of M&A scrutiny

#59

Post by elefanten »

linotype wrote: post #30
elefanten wrote: post #17

Earlier quoted context omitted.

https://www.yalelawjournal.org/pdf/e.710.Khan.805_zuvfyyeh.p... She got boosted by an insurgent group of law professors who spearhead whats called the Neobrandeis moment. Their theory is that anti-trust should be preemptively enforced against size for its own sake. This is the article she wrote for her law review as a law student which put her on their radar and they started calling her a "rising star" etc etc, which…

What errors?

A lot beyond the scope of the time I have to comment here. Read it with an open mind, knowledge of tech business, knowledge of how things unfolded since it was published and see for yourself.

But some short hand:

-Assumes vertical integration is necessarily abusive

-Assumes lowering price is necessarily a setup for anti-competitive practices. This one’s particularly ironic because lowering prices is definitely a first-order good for consumers and businesses that buy those goods. Bezos’ famous saying was “your margin is my opportunity” —- would you rather the standard continue to be massive retailer markup profit that goes straight to retail corps?

-Vague scare tactic claims that expanding into media production etc will somehow (yadda yadda, Step 2: ???) lead to monopolies in every category they enter.

The TLDR of the problem with Neobrandeis is it forms a very opinionated paranoid notion that size can only lead to bad things and no good things. It is a lazy dodge around the traditional responsibility of regulators to identify and regulate actual anti-competitive behavior when it actually happens By constraining companies from using any form of size or integration-related advantage, it lowers the pressure to actually be competitive and innovative for everyone else. I’m not saying everything should be unconditionally allowed, there’s a balance to strike. But when you just have a blunt “anti-size” hammer, you’re gonna do collateral damage to a healthy competitive ecosystem in a damaging way.

Re: Lina Khan points to Figma IPO as vindication of M&A scrutiny

#60

Post by brettgriffin »

zenmac wrote: post #54
Invictus0 wrote: post #49

Earlier quoted context omitted.

[flagged]

Not for no reason at all, just not economical or innovative or supporting the customers. It is all a dog and pony show now to chase the investors while centralize and concentrate wealthy in the hands of very few. Edit: do think we ought to promote using Penpot type of alternative to proprietary counter part.

M&A deals are analyzed pretty closely and there (usually) has to be a convincing argument that it is economically or strategically accretive to the acquirer. It's easy to call them all morons from afar, but I think it just highlights how difficult it is to pull off successfully. And when it is successful, it's always an obvious no-brainer in retrospect.

Anecdotally, I know someone that spent two years intentionally sabotaging an M&A deal that would replace his internal product and team in a company. He and his colleagues were successful and everyone thinks the acquirer was a dumbass for doing it, but with more knowledge about the misaligned incentives it starts to become more clear.

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