A Sensible Strategy: The Mighty Google and Tiny Acquisitions

Courtesy of Google Blogoscoped, I came across this interview with
Eric Schmidt. I listened to the interview as well.

Reporter: How many acquisitions do you do?
Schmidt: “It’s one or two a week it seems. Most acquisitions: They are very small. 1-2-3 people and you never, never hear about them.”
“Why would you want to be acquired?” Schmidt asked reporters rhetorically.
“The venture guys have so much money, you don’t need to get acquired by us for capital.
“The reasons… that they (start-ups) would choose be to be acquired are not what you might think. There is so much capital. And many of these businesses require no capital.
“The reason to be acquired is that Google gives them (Web entrepreneurs) a platform that they might otherwise not be able to get. As markets consolidate these little companies often cannot get enough ‘mindshare,’ even though their technology is really good. Any one of these people are a reasonable (acquisition) candidate.

Also listen to Eric talking about how some thought that Google was run by idiots and how it too faced problems like every other enterprise.

I certainly feel that Google Hype needs to be watched more carefully, but I can give the company credit - that they have been very sensible about their acquisitions – they have not taken (so far), the "throw money and grab that share/space" approach. Instead they had been trying to take the business as growth platform approach, at least in their core business.

Recently, I was talking to a good friend, who was not decided on an opportunity that would have meant that he would be earning almost twice his current salary in a company of better stature and bigger size; he said that one concern that was holding him back was that the other company had made a series of acquisitions in the recent past and the information is that the integration is taking time and proving to be painful.

Article Author: Sadagopan S

S. Sadagopan, heads consulting and eBusiness for Satyam in the Asia Pacific, Middle Eastern and African markets based out of Singapore. He has led several consulting and technology transformation engagements covering multiple industries cutting across a wide variety of technologies around the world. …

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