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Comment by mschuster91 | Hacker News Reader

> I can't read the full article but on one hand Apple poached employees which sounds legal on the face of it. On the other hand the patents for the technology that Apple filed were not legitimate [0] according to the courts. So the issue here seems to be more that the patent review process is weak and requires a lengthy and expensive court case to clarify. Something a small company may not afford.

It's also something else that I find pretty bad business conduct: Apple, Google, Microsoft - they all love to have someone else (i.e. venture capital) bear the cost of proving that a piece of technology actually will work out and is technically feasible, and then incorporate it into their product. Even if it's a legit acquihire or acquisition, the VCs are stuck with the bills for the failed attempts.

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Right but I can't imagine this is something you can change as long as the other participants are willing to take that risk. For VCs this is like playing a lot of roulette tables at once for a potential big pay day. A single player like the article's Masimo Corp doesn't have the luxury of multiple roulette tables so they are far more exposed.

Letting someone else go first doesn't have to be bad practice, someone always goes first and the others follow. Different players have different risk appetites and this can lead to healthy competition. Unless it's abusing a position of power. Look at Amazon when they use knowledge about products and sales that are normally not public to launch their competitors, or Apple here taking over the engineering team legally but then stealing the tech probably assuming the chips will fall their way.

> Apple, Google, Microsoft - they all love to have someone else (i.e. venture capital) bear the cost of proving that a piece of technology actually will work out and is technically feasible, and then incorporate it into their product

It isn't just them. All large companies do this. They constantly watch the little players and anytime one of them does something interesting that seems like it is working they buy the company - this is in fact something venture capitalists count one: it is one of the easiest exist strategies they have.

Most big companies also play venture capitalists themselves: they are constantly looking for startups to invest in, with the idea that if that company produces something useful they will buy the company completely, if not they have carefully limited their losses.

On the flip side, often the acquihires are ways for VCs to get a soft landing for a company that isn't working and return a little capital. There are reasons that venture capitalists maintain close relationships with acquisition decision makers a big tech companies.

Source: in the VC industry

People often think VC companies are either 0% or 100% unicorn; quite a few of them are somewhere in the "this probably almost could have been a viable business if it didn't have so many demands on profit" (there's a term for this, lifestyle business? I forget.) Acquihire can be a wonderful exit for those, as the VC can basically get back some or all of the money poured in, the people in the company get a job, and sometimes the product even survives as a feature.

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