A startup is not a Résumé

Hey! You! Want to get a job in Silicon Valley? Well, you could apply for open positions, but that’s so last century.

Instead, why not start your own company, build it for a few years, get bought out by a competitor, kill your product, and start working for the company by whom you were acquired.

No it’s not convoluted, it’s disruptivetm


Welcome to the world of “acquihires”. It sounds pretty ridiculous, and yet they’re on the rise. A quick search of Hacker News for the phrase “is shutting down” is pretty revealing. It makes me wonder if some founders are starting companies with the sole purpose of being acquihired.

The rise of the acquihire lead to the creation one of my favourite single topic blogs - Our Incredible Journey - which documents the acquisition announcements of startups. Our incredible journey also highlights how many of these startups promise to keep their existing product alive post-acquihire, only to kill their original product a few months down the line, often with little warning, and no easy to to migrate to another service.

This trend also gave birth to Shutdownify, a mock startup providing “Shutdown Notice as a Service”, which itself then shutdown on the same day it launched.

In some ways I can see the appeal of the acquihire: The founders of the acquired company get a nice pay-day, as well as the job they wanted to begin with (albeit a few years later). And the acquiring company gets to kill a competitor, and fold the creators of said competitor into their own offering. Everybody wins!

Well, everybody wins except the loyal customers of the (now deceased) acquihired company, but fuck the customers, this was never about them to begin with.

And therein lies the problem, customers are getting sick of being treated like they’re disposable, just collateral on someone’s incredible journey to a job with a Silicon Valley unicorn. People are getting wise to this racket, and growing distrustful of software as a service startups.

Check out these comments from a Hacker News post about Sunrise’s recent acquihire:

The overarching lesson I'm slowly learning is to not get too comfy with any saas products. Who knows how long they'll stick around, regardless of if they're great / popular / profitable.

I still prefer to use desktop-based products that I own as much as possible for this reason. Rather than think of it as being behind this swing of the pendulum, I prefer to think of it as being ahead of the next one.

I actually used Stallman's phrasing 'Service as a Software Substitute' in conversation the other day. This pattern is getting ridiculous.

This feeling of distrust towards SaaS startups is concerning for me, and should be for any other founders who have zero interest in being acquihired.

I’m sure things used to be simpler - if a company shut down, it was usually because it ran out of money. All you had to do was be wary of free (and to a lesser extent freemium) offerings, and things would be ok. These days it seems it’s anyone’s guess.

I decided to analyse the recent postings on Our Incredible Journey, and while it’s a fairly small sample size, I found the following:

  • 72% of the companies were based in Silicon Valley.
  • It took an average of 3.9 years to go from launch to shut down.
  • 3 months was the average notice period between the announcement and the shut down.
    • 17% offered no notice period.
    • 47% offered less than one month.
  • 39% promised to keep their product alive, only to kill it later.

Based on those statistics, it’s little wonder people are loosing faith the in SaaS model. All I can say is BugMuncher will never be acquihired. Working for someone else sounds like my idea of hell, why do you think I started working for my self in the first place?

- Matt