GOOGLE BOUGHT A COMPANY FOR $100 MILLION, THEN SHUT DOWN ITS MOST FAMOUS PRODUCTS
Google didn't necessarily want the product. It wanted what was behind it.
In 2012, Google acquired Meebo, a company known for messaging products and tools that helped publishers add social features to their websites.
The reported price was around:
$100 million.
Then something strange happened.
Just weeks after the acquisition, Google announced that most of Meebo's products would be shut down.
MEebo HAD BUILT SOMETHING PEOPLE ACTUALLY USED
Meebo wasn't some abandoned startup with no customers.
It had built products including:
Meebo Messenger
Mobile apps
Social-sharing tools
The Meebo Bar
The Meebo Bar was particularly interesting because publishers could place it across their websites to add social and engagement features.
Then Google bought the company.
And most of it disappeared.
WHY BUY SOMETHING — THEN KILL IT?
Because an acquisition doesn't always mean:
"We love your product."
Sometimes it means:
"We want what your company has built."
That could be:
Engineers
↓
Technology
↓
Patents
↓
Expertise
↓
Customers
↓
Infrastructure
↓
Ideas
The product customers see may actually be the least important part of the deal.
GOOGLE WAS FAMOUS FOR THIS
Google had a long history of acquiring companies and then integrating their technology or employees into its own products.
Meebo fit the pattern.
Instead of maintaining several separate products, Google could take the technology and people it considered useful and put them somewhere else.
The result?
The original Meebo ecosystem became much smaller.
THE MOST IMPORTANT PART WASN'T THE APP
Imagine building a company for years.
You create a product.
You get users.
You build a brand.
You hire a team.
Then another company buys you.
And shortly afterward:
Your product disappears.
That doesn't necessarily mean the acquisition failed.
The buyer may have considered the technology or talent more valuable than the standalone product.
THIS IS CALLED AN ACQ-HIRE
One version of this strategy is often called an acqui-hire.
The company isn't primarily buying the startup for its customers or revenue.
It's buying the people.
For a giant technology company, hiring an entire experienced team can sometimes be faster than trying to recruit dozens of people individually.
So the calculation becomes:
Buy the company
↓
Keep the people
↓
Integrate the useful technology
↓
Remove products that don't fit
BUT THERE WAS A PROBLEM
Customers don't see an acquisition this way.
They see:
"The product I used just disappeared."
For them, it doesn't matter that the engineers moved to another Google team.
They lost the service they actually wanted.
That's one of the strange economics of technology acquisitions.
The buyer can consider the acquisition successful even when the original product dies.
THE PRODUCT CAN BE WORTH LESS THAN THE PEOPLE
This is one of the most counterintuitive ideas in the startup world.
A startup might have:
$10 million in revenue
but its technology could be worth more.
Or its engineering team could be worth more.
Or its patents could be worth more.
Or its user data could be strategically important.
Or the company could simply have built something the acquirer doesn't want competitors to control.
The acquisition price isn't necessarily a valuation of the product sitting in the App Store.
AND THAT CHANGES HOW YOU LOOK AT ACQUISITIONS
When you hear:
"Google bought X for $100 million."
Don't immediately ask:
"How much money was X making?"
Ask:
"What exactly did Google buy?"
Was it:
The brand?
The users?
The technology?
The employees?
The patents?
The distribution?
Or simply the time it would have taken Google to build everything itself?
THE STRANGE ENDING
Meebo's products didn't need to become failures for Google to shut them down.
They simply didn't need to remain independent.
The acquisition changed the objective.
Before Google:
Build Meebo.
After Google:
Help Google build what comes next.
That's a completely different business strategy.
MAACAT PERSPECTIVE
The biggest lesson from acquisitions is that the thing being sold isn't always the thing customers see.
A company can buy a startup and destroy its most visible product while still believing it got exactly what it wanted.
Because sometimes the real asset isn't the app.
It's the people, technology, knowledge and time hidden behind the app.
That's why one of the strangest outcomes after an acquisition can be:
The buyer pays millions for a company — and then turns off the product that made everyone notice it.
