When the cat’s away, the mice…

by Mathew on February 5, 2008 · 2 comments

I think Marc Andreessen — as usual — puts his finger on something important in his post on how the Microsoft-Yahoo merger (assuming it actually goes through) will affect the startup climate in Silicon Valley or elsewhere in the technosphere. Among other things, he points out that Microsoft, Yahoo and even Google don’t really account for a huge number of takeovers of Web startups anyway, once you get past del.icio.us and Flickr and a few others. But that’s not the big point.

I think the killer point is that while the elephants are mating (as I think my friend Paul Kedrosky described it), the field will be more or less completely open for Web companies to do whatever they can to develop a killer service or own a particular segment of the market, without having to worry about a gigantic beast lumbering into their business sector and squashing everything in sight. As Marc describes it:

In practice, that will be two years in which both Microsoft and Yahoo will most likely be considerably less aggressive on rolling out new products and new initiatives — because the key people at both companies will be consumed with the merger.

And, just think, if they are buying fewer companies as a consequence, that also means they’re less likely to buy one of your competitors and come after you while you are building your thing of value.

Marc has some other great points as well, including the fact that building a company just to get acquired is a dumb thing to do anyway, and rarely works out the way you want. In fact, building a company because you sense an opportunity or a need or a hole in the market — without focusing on getting acquired — is a far better way to actually ensure that you get acquired. Take your eye off the destination and focus on the journey, and pretty soon you will find that you’ve arrived.

  • http://furrier.org John Furrier

    Matthew,
    The issue about startups is that they have to be careful not to be colateral damage. I think that if done right a startup can be a service provider during this tech war. I've seen it in 96-99. On the other side of the coin startups have to be careful about not having the titan take their idea and quickly emulate it. Now more then ever the ability to have weapons is the key for the titans. As Marc says they are “armored up”. Memo to startups..build those weapons – it's a war time venture.

    John
    http://furrier.org

  • http://furrier.org John Furrier

    Matthew,
    The issue about startups is that they have to be careful not to be colateral damage. I think that if done right a startup can be a service provider during this tech war. I've seen it in 96-99. On the other side of the coin startups have to be careful about not having the titan take their idea and quickly emulate it. Now more then ever the ability to have weapons is the key for the titans. As Marc says they are “armored up”. Memo to startups..build those weapons – it's a war time venture.

    John
    http://furrier.org

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