Hacker News Reader

Comment by mrkramer | Hacker News Reader

But sometimes you need to sell your company because simply you do not have enough resources to fulfill your mission and vision.

View on HN

Traditionally we would call that a failed business.

Instagram and YouTube were failed businesses? They sold to big companies in order to scale to billions of users and millions of SMBs because they didn't have knowledge nor human and financial resources for such task.

Maybe if they hadn't scaled to, oh, I don't know, THE ENTIRE PLANET, maybe some MORE companies could come in and build successful businesses in the space, and, hey, maybe even figure out how to federate and interoperate. I know, I know. Crazy talk.

> maybe some MORE companies could come in and build successful businesses in the space

This rejects that these businesses required scale to be successful, strengthening the claim that they were not “failed businesses.”

They only need scale if you accept the premise that they need to be the only provider in that space.

I wonder about youtube - I see people say it still loses money though I don't know if that's true, but if it is, then is it a successful business? It's an amazing feat no doubt, but other than that I don't know what to make of it as a business or a force in the world.

Youtube is printing money right now as traffic/computers are cheap which was not the case 10 years ago. It's a very successful (multi $B profit) business right now. They reinvest some profits into original content but it's probably peanuts compared to overall profits.

There's no way to know whether they would have failed without being acquired. That isn't the point being made though.

They didn't have the knowledge or resources to figure out that they can't indefinitely burn money and needed to sell user data and ads?

They were either failed businesses (if they couldn't have survived at all without becoming a worldwide phenomenon) or they were greedy (if they could have survived, but really just wanted it all).

Either way, the acquisition of either should never have been allowed.

Did Google and FB have to sell to stake to billions of users and millions of SMBs? no!

Products that can't be profitable as a standalone business but can be as part of a larger company's portfolio isn't really a useful definition of failed unless you redefine the term.

If they can’t be profitable as standalone businesses, by definition they’re failing as businesses.

A business can fail even with a good product. There are thousands of startups all over the world every year that can attest to that.

If the business has a value more than you put into it then you haven’t failed.

That's what the stock market is for.

Or just funding rounds.

Yes, but the stock market would be better as it would allow the public to invest. Funding rounds are just a way to let the rich and privileged get even richer.

No, you're wrong. They're still taking risks.

You see, when you have 1000 million and you invest 500 million in chunks of 1 million into 500 different companies, practically guaranteeing a return of >500 million [1], then you're taking a huge risk! Almost like the Average Joe/Jane investing on the stock market :-)

[1] Since it's supremely unlikely all 500 companies fail, and it's much more likely that at least 1 of them comes up with a decent return on investment.

Reply on news.ycombinator.com