Last updated: October 2, 2020
How to Get Facebook to Buy Your Startup
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How do you measure your startup success?
There are as many different reasons for founding startups as there are tech entrepreneurs in Silicon Valley.
Some entrepreneurs start companies in order to follow their passion. They just want to be able to make a living doing what they love, or simply desire the freedom of being their own boss.
Other entrepreneurs might do it for the challenge. Serial entrepreneurs enjoy getting companies up and running and then moving on to start the next one, or even having their hands in multiple businesses at the same time. Staying with one startup for too long would be too boring for them.
Some entrepreneurs make it their goal to get rich. They dream of building their startup into a stable Fortune 500, and making money hand over fist as a powerful CEO.
Other entrepreneurs want to make it rich by selling off their startups for billions to a big company like Google or Facebook.
While that might seem like a lofty goal, it may not be as much of a stretch as you think. After all, Facebook has been snatching up companies left and right since its first acquisition in 2007, and they're paying anywhere from $15 million to $19 billion for each company.
But a winning strategy for getting on Facebook's radar isn't so clear-cut; they're not as predictable in their acquisitions as you might think. While they do buy a lot of startups that are closely related to Facebook's offerings, like Instagram and WhatsApp, they've also acquired some companies that have left onlookers a bit puzzled as to their ultimate strategy, like Oculus Rift and fitness tracking application Moves.
Despite the seemingly random nature of some of their acquisitions, there are discernible patterns you can use to your advantage. If you want your company to get Facebook's attention, you've got to have a strong and talented team, overlap your target audience with Facebook's, and try to complement what Facebook is offering their users. Take a look at the guide below to get started on brainstorming your next startup, and Facebook may soon be knocking on your door.
How to Get Facebook to Buy Your Startup
Facebook has been on a buying spree with around 40 acquisitions since 2007. They buy small businesses they can leverage to expand on and improve their product. Here's how you can get their attention with your own product or service.
Dominate Your Sector
Get Facebook Interested: design your product to integrate with Facebook for mutual benefit.
- What'sApp: A cross platform messaging app
- Facebook and WhatsApp have a "shared mission to bring more connectivity and utility to the world by delivering core Internet services efficiently and affordably."
- Oculus VR: A virtual reality platform
- Facebook wants to expand virtual reality beyond gaming.
- It's possible they'll expand to make the messaging feature more immersive, like a face-to-face conversation.
How can you do it? Look at what Facebook is offering their users:
- Graph search
What, in your sector, can you offer to complement it?
Build a Strong Tech Team
If you have a killer tech team building your products and services, Facebook will pay attention to you for your talent.
They may not buy your entire company/product, but they'll have your staff join their team.
- Branch Media: A social conversation firm; their products live on outside of Facebook.
- Their team is building a "Conversations Group" for Facebook and is based in New York City.
- Hot Studio: A top design team in New York City.
- Facebook acquired the team to improve their own design.
- Little Eye Labs: An Indian software development start-up, known for their analytics programs that examine Android app performance.
- Facebook wanted the team to enhance their own mobile app.
How can you do it? Acquire top-notch talent with impressive resumes.
- Network often.
- Tailor your job offers to an individual applicant's needs.
- Offer rewards to your current employees for referring other applicants.
Appeal to a Younger Audience
Facebook is losing market share with younger audiences. 3 million teens have left the social network between January 2011 and January 2014.
- 95% of teens (aged 12-17) are online.
- 81% of them use at least one form of social media.
- 94% of those teens use Facebook.
Advertisers, including Facebook, love younger audiences because they can more easily alter their taste in products and services. If your product appeals to a younger demographic, you'll likely to get their attention.
- Instagram®: A photo sharing website.
- Facebook wanted this to expand on their existing photo features and to prevent another competitor from getting it first.
How can you do it?
- Research the younger online audience, and features they want.
- Create something that appeals to their wants and desires that will integrate well with what Facebook has to offer.
Help Enhance Facebook
If your product can make Facebook better, you'll be more likely to catch their attention. These companies offered services that Facebook used to improve their platform.
- Face.com: Used to offer face recognition software, to let users tag their friends in photos they share.
- Parakey: Web operating system that makes the process of transferring video, images, and text to the web less complex.
- Used to enhance the Facebook mobile app.
- FriendFeed: Newsfeed that consolidates various social media website updates into a single feed.
- Used to enhance the Facebook feed.
- Octazen: Contact importer that returned a list of contacts to make inviting friends from other platforms to services easier
- Used to make it easier for users to:
- Connect with contacts from other platforms on Facebook.
- Find people they may know.
- Sign into other services with your Facebook login.
- Friendster Patents: Network of social media patents including advertising, virtual payments, etc.
- Enhanced the Facebook credit/advertising purchasing system.
- Enhanced Facebook advertising.
- SportsStream: Platform to capture sports chatter.
- Used to help build out the trending topics feature.
- ShareGrove: Private conversations website.
- Integrated into Facebook Groups feature.
How can you do it? Ask yourself:
- What features does Facebook have that can be improved?
- Facebook is an advertising company, how can you help them better reach niche markets?
- What direction is Facebook moving? Hint →
- "Mobile is the platform of today, and now we're also getting ready for the platforms of tomorrow." - Mark Zuckerberg
- Facebook Mergers and Acquisitions - facebook.about.com
- Facebook to Acquire WhatsApp - newsroom.fb.com
- Why Facebook Loves Acquiring Small Businesses - dailyfinance.com
- Facebook Acquires Branch Media Team To Lead New "Conversations" Group - techcrunch.com
- How to Attract Talent to a Small Company - guides.wsj.com
- Facebook Scoops Up Face.com For $55-60M To Bolster Its Facial Recognition Tech (Updated) - techcrunch.com
- Welcoming the Talented Team Behind Hot Studio - facebook.com
- Facebook Acquires Hot Studio Design Team - insidefacebook.com
- 3 Million Teens Leave Facebook In 3 Years: The 2014 Facebook Demographic Report - istrategylabs.com
- Teens Fact Sheet - pewinternet.org
- More Than 11 Million Young People Have Fled Facebook Since 2011 - business.time.com
- Instagram Press - instagram.com
- 10 Reasons Why Facebook Bought Instagram - forbes.com
- Facebook's First Acquisition: Secretive Start-up Parakey - venturebeat.com
- Facebook Acquires FriendFeed (Updated) - techcrunch.com
- Octazen: What The Heck Did Facebook Just Buy Exactly, And Why? - techcrunch.com
- Facebook Buys Friendster Patents for $40M - gigaom.com
- Report: Facebook to acquire Titan Aerospace for $60M - insidefacebook.com
- Facebook Acquires SportStream To Increase Sports Chatter By Providing News Outlets With Cleaner Data - insidefacebook.com
- Facebook acquires SportStream - techcrunch.com
- Facebook Acquires "Private Conversations" Site ShareGrove - insidefacebook.com
- Facebook Acquires Moves, a Fitness Tracking App - mashable.com
- Facebook Now Translates Posts and Comments Not In Your Native Language - lifehacker.com
- Facebook Acquires Oculus VR for $2 Billion - fastcompany.com