Yesterday the Internet mourned the death of Twitter-owned Vine, a web product everyone apparently loved but stopped using years ago. One of the company’s co-founders, Rus Yusupov, tweeted his bitter takeaway: “Don’t sell your company!”
It’s a common trope among startup founders: Unless your company is already at death’s door, selling out is the quickest way to kill it.
Except it’s not that simple with Vine. Former Twitter recruiter Morgan Missen pointed out that Vine hadn’t even launched its product when Twitter acquired it in 2012. What’s more, Vine’s founders left shortly after the deal, and Twitter ran the product for four years. Twitter certainly failed to capitalize on Vine, but the company’s founders may not be blameless, either.
I’m not sharing this just because I love a good Twitter spat about Twitter. I’m sharing it because the issue of startups thriving under corporate parents is important as Fortune 500 companies from all industries, not just tech, are increasingly snapping up well-funded startups. Buying innovation isn’t as simple as just writing a check.
I explored that issue in a recent magazine profile of Cruise Automation, the self-driving car startup that General Motors bought for $1 billion (including earn-outs) before even it even launched a product. The relevant part from that story:
The founders of Cruise have a lot to prove and are determined to make their deal a success, perhaps moreso than the founders of Vine were. Selling, it turns out, was the easy part.