The acquisitions of two small and distinct technology companies that encountered problems prior, during, and post acquisition.

Research the acquisitions of two small and distinct technology companies that encountered problems prior, during, and post acquisition.

Full Answer Section

     

Problems before the acquisition:

  • Periscope was still a relatively new app, and it was not clear how it would fit into Twitter's long-term strategy.
  • Twitter was facing increasing competition from other social media platforms, such as Facebook and Instagram.

Problems during the acquisition:

  • Twitter failed to integrate Periscope into its platform effectively.
  • Twitter did not give Periscope the resources it needed to succeed.

Problems after the acquisition:

  • Periscope's user growth declined.
  • Twitter announced that it would be shutting down Periscope in 2017.

2. Yahoo's acquisition of Flickr

Yahoo acquired Flickr, a photo sharing website, in February 2005 for $35 million. Flickr was a popular website at the time, with over 5 million active users. However, Yahoo failed to invest in Flickr, and the website fell behind its competitors. In 2018, Yahoo sold Flickr to SmugMug for an undisclosed amount.

Problems before the acquisition:

  • Yahoo was struggling to keep up with its competitors, such as Google and Microsoft.
  • Yahoo was not clear about how it would integrate Flickr into its platform.

Problems during the acquisition:

  • Yahoo failed to invest in Flickr.
  • Yahoo made changes to Flickr that alienated its users.

Problems after the acquisition:

  • Flickr fell behind its competitors.
  • Yahoo sold Flickr to SmugMug in 2018.

These are just two examples of small and distinct technology companies that encountered problems prior, during, and post acquisition. There are many other examples of acquisitions that have gone wrong. It is important to carefully consider all of the potential risks and challenges before acquiring a company.

Lessons learned from these acquisitions:

  • It is important to have a clear plan for how the acquired company will be integrated into the acquirer's platform and strategy.
  • It is important to invest in the acquired company and give it the resources it needs to succeed.
  • It is important to listen to the feedback of the acquired company's users and customers.
  • It is important to be prepared for the possibility of cultural clashes between the two companies.

Conclusion

Acquisitions can be a great way for companies to expand their product offerings, enter new markets, and gain access to new technologies. However, it is important to carefully consider all of the potential risks and challenges before acquiring a company. By understanding the lessons learned from past acquisitions, companies can increase their chances of success.

Sample Answer

   

Twitter's acquisition of Periscope

Twitter acquired Periscope, a live video streaming app, in March 2015 for $100 million. Periscope was a popular app at the time, with over 10 million active users. However, Twitter failed to integrate Periscope into its platform effectively, and the app's user growth declined. In 2017, Twitter announced that it would be shutting down Periscope.