Four increasingly clear options for future Internet acquisitions

Absrtact: MUI under the leadership of Yahoo, seems to be a little more youthful bright colors, 1.1 billion dollars acquisition of Tumblr will give Yahoo injected what? In the past, Yahoo and AOL were known as the graves of the acquirers, most of whom died silently. such as Yahoo's 5.7 billion-dollar acquisition of online broadcasting

MUI under the leadership of Yahoo, seems to be a little more youthful bright colors, 1.1 billion dollars acquisition Tumblr will give Yahoo injected what?

In the past, Yahoo and AOL were known as "the graves of the acquirers", most of them dead quietly. For example, Yahoo uses 5.7 billion dollars to buy the online broadcast broadcast.com, it has not become the Internet industry COMCAST;36 billion-dollar acquisition of social network Geocities, it has not evolved into a new generation of FACEBOOK;16 billion dollar acquisition of Overture, Also not become Google's adsence ... Of course, the most successful 2 is enough, early investment Alibaba, Yahoo Japan, this is enough to prop up Yahoo's current 29 billion U.S. dollar market value of 28 billion dollars.

Yahoo is fine: Yahoo Ali Division, Yahoo Japan Division, Yahoo American Division is three different world, in fact, the acquisition of Tumblr is the United States division. Well, 1 billion U.S. dollars in the United States Division, the acquisition of 1.1 billion of dollars of opponents, this should be the same magnitude of the merger?

If you stand in this dimension, Tumblr may not be worth the money. After all, in the social sphere, Facebook is hard to shake, Twitter is extremely strong in the social arena, and Tumblr is a lightweight blog-the predecessor of this lightweight blog, Google's blogger, is tending to old age, and its rivals have a free app like WordPress, Does blogging really have a future? One explanation is that Yahoo is weak on the mobile side, which is a Tumblr advantage, but don't forget how much of the mobile end is necessary to keep a blog? Even if it is lighter than traditional blogs.

Of course, Yahoo is not worth the purchase value is not our focus, it depends on time to prove. We want to ask is, why such a target, Yahoo also urgent to start?

The landlord's house has no surplus!

More than 90% of the world's original Internet business from the United States, the most cattle internet companies 80% in the United States, but, even the United States, there are few good bids for acquisitions, the landlord's home also has no surplus.

For Google, Amazon, EBay, Facebook, Priceline and even Yahoo, is a sea of sharks. Sharks want to eat enough, need to have a decent mark, a midsize "sardine" on a revenue or user dimension, not a crayfish--not that it doesn't need to buy crayfish, but that crayfish are acquired, basically in the acquisition of talent, not the enterprise, will become a giant "patch", Just like Facebook bought Instagram.

Among the already-listed internet companies, the "sardines" of midsize companies are: LinkedIn is over 16 billion dollars, Netflix has more than 12 billion dollars, Yandex nearly 9 billion dollars, and Expedia and TripAdvisor nearly 8 billion dollars. AOL, HomeAway, Zynga, Pandora, Yelp, Zillow, OpenTable are all between 1.5 billion and 3 billion dollars, only "yellow", other basic insignificant, can be regarded as pop. Even with unlisted companies, only Twitter, Square, Tumblr and other few.

And it's easy to see that only a few giants like Google, Amazon, EBay and Facebook are "platform traders." Yahoo itself is increasingly designated as a pure information provider, PriceLine, Expedia and TripAdvisor are all in the vertical area of tourism, NetFlix, Pandora in the Streaming media field ... In addition to sharks, "sardines" and "yellow" main living space in a particular niche market, do a professional and in-depth.

So, even in the United States so the Internet is extremely developed, a lot of entrepreneurs market, shark prey is not much, the result of plate reorganization, from the tribe to the spring and Autumn Period, and then to the Warring States, the gap between the medium-sized enterprises left.

Four trends in future acquisitions

Therefore, Yahoo is not the same, is not for, only in the remaining plate to find their own eyes the best target. In fact, this is also reflected in the future Internet acquisition four increasingly clear choice.

The first kind, the cattle man. Most of Facebook's acquisitions fall into this category, as the platform-type companies such as Facebook are not diversified, but are constantly honed and upgraded by the core platforms. That's the logic behind Zuckerberg's frequent takeover of a business and shutting it down.

Second, the acquisition of heavy assets. The internet is a light asset industry, but as the market evolves, many giants care more about how to increase their defenses in the arsenal, the earliest cases such as Google's takeover of YouTube, the acquisition of PPS by Baidu, and recent examples such as Ali's acquisition of the German stock.

Third, the acquisition of fast companies. The acquisition of fast companies, sometimes not because they can determine the success of these enterprises, but to avoid the emergence of subversive mode, in a sense like VC, for example, Yahoo acquisition Tumblr, Facebook acquisition Instagram.

Fourth, the acquisition of similar levels, or similar areas have a certain complementary competitors, reduce the intensity of competition. The most typical example is Youku's acquisition of potatoes, and Priceline's takeover of Kayak.

In China's internet sector, talk about the necessary and bat, because these 3 companies occupy more than 70% of the industry's revenue and more than 80% of the profits, their nearly 2 years of big acquisitions are also widely watched. In view of the evolution of China's Internet market is slower than the United States, more diversified market structure, so there are a number of medium-sized companies, such as Sina, Sohu, Giant, Perfect, grand, ELong ... But do you believe in the "China exception" theory that they will not be acquired?

For most yellow and lobster-grade entrepreneurs, selling may be a more realistic option than listing, so it is particularly important to make features and build barriers in the market segments.