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

DigitalOcean acquires Paperspace (YC W15) for $111M in cash

finance.yahoo.com

Post reply on HN
Print view View original

71–80 of 98 posts

Re: DigitalOcean acquires Paperspace (YC W15) for $111M in cash

#71

Post by looping__lui »

mewmew07 wrote: post #24
looping__lui wrote: post #17

Oh, fun memories - locked me out of my account (froze it or whatnot) but happily charged me. Didn’t notice for a while as I didn’t really use it. Support just ignored my questions.

too vague! who locked you out? why did you get the hammer?

I have no idea tbh. Never got an email abt it. Saw the charges after a while (my miss) wanted to log back into my account to cancel - couldn’t because account was locked.

The thing that annoyed me most is: they knew the account was locked and I could not used it and still charged me.

Re: DigitalOcean acquires Paperspace (YC W15) for $111M in cash

#72

Post by looping__lui »

mewmew07 wrote: post #24
looping__lui wrote: post #17

Oh, fun memories - locked me out of my account (froze it or whatnot) but happily charged me. Didn’t notice for a while as I didn’t really use it. Support just ignored my questions.

too vague! who locked you out? why did you get the hammer?

I also never got an explanation or like any feedback from customer support. They randomly charged back a number of charges and deleted my account (!) so I could never find out what happened. Weirdest customer/service experience I had in a VERY long time

Re: DigitalOcean acquires Paperspace (YC W15) for $111M in cash

#73

Post by FredPret »

thejazzman wrote: post #70
graton wrote: post #66

Earlier quoted context omitted.

One option you could try is using a CloudFlare tunnel.

I love this option. Doubles as a way to VPN-into your home network remotely (Warp Client) without opening any ports

Thanks to you both. I'll look into it.

You can buy a computer that is 1000x more powerful than a droplet for a fraction of the ownership cost, especially if you only get occasional visitors.

I'm excited by the idea of completely decentralized hosting; now we just need decentralized payments - that take USD.

Re: DigitalOcean acquires Paperspace (YC W15) for $111M in cash

#74

Post by gizmo »

re-thc wrote: post #51
AYBABTME wrote: post #43

Earlier quoted context omitted.

What would be the strategy you think they're going for?

The I pretend I know what I'm doing strategy. Most acquisitions fail. It's a difficult path unless it fits a very specific need. Yet a common management / product strategy is to buy random companies as though they are ingredients of a dish and think it'll just work. Digital Ocean to me has lost their core focus and appeal. They aren't upgrading their hardware, software and other crucial pieces of their infrastructure…

> Yet a common management / product strategy is to buy random companies as though they are ingredients of a dish and think it'll just work.

Acquisitions are an easy way to juice top line growth. Acquisitions also offer ample opportunity to put lipstick on your finances. After all, any acquisition has many one-time costs and you can use this to juice your margins. You also forecast substantial cost savings by eliminating redundant positions. All in all, your gross margins and YoY growth look a lot healthier after the acquisition even when nothing has fundamentally improved about your business.

Repeated acquisitions really muddy the water and make it even harder for analysts to figure out how well your core business is doing. Especially when growth in your core business is stalling it makes a lot of sense to obfuscate your finances while you purchase top line growth.

All the while the stock price stays high and the executives get to enjoy their option packages. Eventually the music stops, but clever executives jump ship before that happens.

Re: DigitalOcean acquires Paperspace (YC W15) for $111M in cash

#75

Post by alexawarrior »

drc500free wrote: post #58
7e wrote: post #33

$111M exit on $35M. Seems meh for seven years effort. Were prospects cloudy? Better return over seven years for most employees (possibly even founders) working up through a FAANG. I’m sure YC did great, of course.

It's kind of like going to vegas for a week and coming out with a lot of good stories and 90% of your money. In terms of investor return, I think it's healthy to have some exits like this. A bunch of the money was only in for 2 years, and probably doubled their investment in that time. The rest of the investors got their money back, with something close to NASDAQ returns on top of it. If this was the baseline for the…

Without insider knowledge of the transaction, it is impossible to say what the returns were for various tranches of investment or for the founders or employees.

Re: DigitalOcean acquires Paperspace (YC W15) for $111M in cash

#76

Post by noonething »

FredPret wrote: post #73
thejazzman wrote: post #70

Earlier quoted context omitted.

I love this option. Doubles as a way to VPN-into your home network remotely (Warp Client) without opening any ports

Thanks to you both. I'll look into it. You can buy a computer that is 1000x more powerful than a droplet for a fraction of the ownership cost, especially if you only get occasional visitors. I'm excited by the idea of completely decentralized hosting; now we just need decentralized payments - that take USD.

Sorry if I'm not getting something, but wouldn't dynamic dns help in your instance?

Re: DigitalOcean acquires Paperspace (YC W15) for $111M in cash

#77

Post by popcorncowboy »

alexawarrior wrote: post #67
popcorncowboy wrote: post #39

Earlier quoted context omitted.

Common getting zero makes sense if pref holders had liquidation multiples ("we get 3x our investment back first"), but not if they converted to common, unless their conversion to common had some weird mechanic attached to it that massively diluted the remaining common down to effectively zero % (which sounds sue-able). I'm really curious about the mechanics of how your common holding netted out to zero if prefs also…

Yes so what happened is they converted, then had majority common, then voted to recapitalize and sell, after which recapitalization they made out with a profit but common got nothing. The problem with this legally was they didn't have the right to convert without a common vote beforehand, essentially they did it in reverse order. Their leverage was the company was not cash flow positive (in no small part because of t…

Ah makes (mechanical) sense now. Thanks for the reply.

Re: DigitalOcean acquires Paperspace (YC W15) for $111M in cash

#79

Post by FredPret »

noonething wrote: post #76
FredPret wrote: post #73

Earlier quoted context omitted.

Thanks to you both. I'll look into it. You can buy a computer that is 1000x more powerful than a droplet for a fraction of the ownership cost, especially if you only get occasional visitors. I'm excited by the idea of completely decentralized hosting; now we just need decentralized payments - that take USD.

Sorry if I'm not getting something, but wouldn't dynamic dns help in your instance?

You mean like No-IP? I used that to SSH into my own servers for a while, but I found it to not be 100% reliable.

Re: DigitalOcean acquires Paperspace (YC W15) for $111M in cash

#80

Post by impulser_ »

FredPret wrote: post #30

I’m surprised by this. Digital Ocean is in no position to be splurging on new revenue streams. They’re underwater and making a loss [0]. They’ve got growing revenue but falling profits and they’ve got more debt than assets. They may want to raise their droplet prices, or issue more stock and then refocus on making their business profitable. [0] valustox.com/DOCN

You can say this about the majority of tech companies. Cloudflare is unprofitable and they are used by the majority of the web.
Post reply on HN