Acqui-hire
Encyclopedia
The term Acqui-hire is used to refer to those Mergers and acquisitions
Mergers and acquisitions
Mergers and acquisitions refers to the aspect of corporate strategy, corporate finance and management dealing with the buying, selling, dividing and combining of different companies and similar entities that can help an enterprise grow rapidly in its sector or location of origin, or a new field or...

 in which the chief target of the acquisition is not the company or the product, but the people building the product.

Typically, the acquiring company simply hires the staff of the target company, thereby acquiring its talent which is the main asset and appeal.

The targets of an Acqui-hire usually tend to be small startups with less than 50 or so employees.

Origin of the Term

The term Acqui-hire is a neologism which became popular in the 2010s.

The term Acqui-hire is essentially a portmanteau of Acquisition and hire.

Variant Spellings

The term has several variant spellings such as Acqhire or Acquhire but the most commonly used spelling is Acqui-hire, with or without the hyphen.

Manquisition

A common synonym used for Acqui-hire is Manquisition which is a portmanteau of manpower and acquisition. But the term Manquisition is less common and is rarely used. Perhaps the most cited use of the term Manquisition occurred when the acquisition of Sofa by Facebook
Facebook
Facebook is a social networking service and website launched in February 2004, operated and privately owned by Facebook, Inc. , Facebook has more than 800 million active users. Users must register before using the site, after which they may create a personal profile, add other users as...

 was reported to be a Manquisition by VentureBeat
VentureBeat
VentureBeat is a technology blog that focuses on innovative companies and the forward-thinking executives behind them.-History:The company was founded in 2006 by Matt Marshall. In 2008, the New York Times called VentureBeat one of the "top blogs"...

.

Paul Graham

The phenomenon of the Acqui-hire was first described by Paul Graham in his essay "Hiring is Obsolete". The essay was published in 2005, but it does not explicitly use the term "Acqui-hire". Nevertheless the essay was one of the first in identifying the general trend of the Acqui-hire. Paul Graham essentially theorizes that the free market is better at identifying talent and traditional hiring practices do not follow the principles of free market because they depend a lot upon credentials and university degrees. Paul Graham was probably the first to identify the trend in which large companies such as Google
Google
Google Inc. is an American multinational public corporation invested in Internet search, cloud computing, and advertising technologies. Google hosts and develops a number of Internet-based services and products, and generates profit primarily from advertising through its AdWords program...

, Yahoo or Microsoft
Microsoft
Microsoft Corporation is an American public multinational corporation headquartered in Redmond, Washington, USA that develops, manufactures, licenses, and supports a wide range of products and services predominantly related to computing through its various product divisions...

 were choosing to acquire startups instead of hiring new recruits.

New York Times

The New York Times used the term "acqhired" to describe the acquisition of Drop.io
Drop.io
Drop.io was an online file sharing service. It allowed users to quickly create "drops", which could contain files of any type, and could be accessed via the internet, e-mail, phone, fax, and widgets. The service did not require users to sign up for an account, and each drop was private unless the...

 by Facebook
Facebook
Facebook is a social networking service and website launched in February 2004, operated and privately owned by Facebook, Inc. , Facebook has more than 800 million active users. Users must register before using the site, after which they may create a personal profile, add other users as...

.

Huffington Post

The term Acqui-hire gained further currency when The Huffington Post
The Huffington Post
The Huffington Post is an American news website and content-aggregating blog founded by Arianna Huffington, Kenneth Lerer, and Jonah Peretti, featuring liberal minded columnists and various news sources. The site offers coverage of politics, theology, media, business, entertainment, living, style,...

 published a list of the top 15 Acqui-hires of all-time.

These top 15 Acqui-hires are (in order):

Drop.io
Drop.io
Drop.io was an online file sharing service. It allowed users to quickly create "drops", which could contain files of any type, and could be accessed via the internet, e-mail, phone, fax, and widgets. The service did not require users to sign up for an account, and each drop was private unless the...



Hot Potato

Beluga

FriendFeed
FriendFeed
FriendFeed is a real-time feed aggregator that consolidates the updates from social media and social networking websites, social bookmarking websites, blogs and micro-blogging updates, as well as any other type of RSS/ Atom feed...



Aardvark
Aardvark (search engine)
Aardvark was a social search service that connected users live with friends or friends-of-friends who were able to answer their questions, also known as a knowledge market...



Slide
Slide.com
Slide, Inc., operator of the Slide.com website, is a Web 2.0 company founded by Max Levchin and based in San Francisco, California. Originally formed to make photo sharing software for social networking services such as MySpace, the company achieved its greatest success as the largest developer of...



Like.com

reMail

Area/Code

Unoh

Fluther

Summize

Pelago

ChoiceVendor

mSpoke

The Huffington Post
The Huffington Post
The Huffington Post is an American news website and content-aggregating blog founded by Arianna Huffington, Kenneth Lerer, and Jonah Peretti, featuring liberal minded columnists and various news sources. The site offers coverage of politics, theology, media, business, entertainment, living, style,...

 also noted that the general trend of the Acqui-hire was stifling innovation because most of the acquired products were later shut down.

Facebook Acquisitions

It is worth noting that many of Facebook's acquisitions have been Acqui-hires and acquired products are often shut-down. Facebook CEO Mark Zuckerberg
Mark Zuckerberg
Mark Elliot Zuckerberg is an American computer programmer and Internet entrepreneur. He is best known for co-creating the social networking site Facebook, of which he is chief executive and president...

 has stated that "We have not once bought a company for the company. We buy companies to get excellent people... In order to have a really entrepreneurial culture one of the key things is to make sure we're recruiting the best people. One of the ways to do this is to focus on acquiring great companies with great founders."

Google Acquisitions

Several of Google's acquisitions have Acqui-hires, as noted by GigaOM
GigaOM
GigaOM is a Web 2.0 blog started by Om Malik and published by Giga Omni Media, Inc. in San Francisco, California. According to the company website it has a monthly global audience of 500,000. It is among the top 50 blogs worldwide by Technorati Rank, and is listed on CNet's Blog 100 list...

. These acquisitions include Aardvark
Aardvark (search engine)
Aardvark was a social search service that connected users live with friends or friends-of-friends who were able to answer their questions, also known as a knowledge market...

 and AppJet
AppJet
AppJet was a website that let users create web based applications in a client web browser, with no other client software. AppJet was founded by 3 MIT graduates, 2 of whom were engineers at Google before starting AppJet...

.

The acquisition of Labpixies by Google was called an Acqui-hire by Business Insider
Business Insider
Business Insider is a U.S. business/entertainment news website launched in February 2009. Founded by DoubleClick Founder and former C.E.O. Kevin P. Ryan it is the overarching brand beneath which fall the Silicon Alley Insider and Clusterstock verticals...

.

Criticism

The general trend of the Acqui-hire or the Manquisition has been criticized because it stifles innovation and the acquired products tend to get shut down after acquisition.

The VentureBeat
VentureBeat
VentureBeat is a technology blog that focuses on innovative companies and the forward-thinking executives behind them.-History:The company was founded in 2006 by Matt Marshall. In 2008, the New York Times called VentureBeat one of the "top blogs"...

magazine has criticized Acqui-hires in its December 2010 article:
"A company is purchased just to hire its founders and maybe some other senior team members. In many cases, a substantial number of employees are laid off, the technology is scrapped, and users of the startup product are screwed."

External links

The source of this article is wikipedia, the free encyclopedia.  The text of this article is licensed under the GFDL.
 
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