There has been a trend in the tech world for the past few years called ‘acqui-hire’.  This is a strategy that involves buying startups that meet certain criteria not for the product but for the team that built the product.  The typical criteria are startups that aren’t generating revenue, had the last round of financing occur just over a year ago, with less than $10M in total funding raised.

Modern open space office with city view

What happens when you buy a company for the engineering team

Why is this important?

It shows the value of a well-oiled team and how great the need is for bigger companies to have teams like this to continue to grow.  Typical startup teams are a cohesive unit; due in no small part to their personalities and abilities fitting the environment they’ve created.

Is this acqui-hire strategy gaining or losing momentum and why?

It’s losing momentum since 2013.  Bigger tech companies and venture capital firms used this strategy at peak levels in 2013 with 2014 and 2015 seeing a small downtick in activity.

This downtick in ‘acqui-hire’ doesn’t mean that talent acquisition is any less important now, the opposite is true.  The reason for the downtick is because the new (yet familiar) strategy is to aggressively target the employees of the company and hire them outright.  Remember, the criteria for acqui-hire was a non-revenue generating company with the last injection of cash occurring over a year prior.  Many of these companies missed their window to be acquired and have a high likelihood of going out of business in the near-term.

If the strategy is losing momentum, why are you talking about it?

We’re talking about this because cultureable addresses the issues faced by everyone in this story.  Companies get a much higher value on money spent; cultureable does not charge $10M to hire a team of 15-30.  The startup employees get the same value as all other candidates that we work with, the ability to find an ideal position that matches who they are and what they do