The Guardian probes an interesting dilemma for startups: Should you flip or float (an IPO)?
The truth is that innovation blackmail [Starting an industry-changing company] and selling out is becoming an increasingly attractive option. With the world's financial outlook so torrid that even the most strapping City magnates are being shrivelled up by paranoia and turned into tiny human prunes, we can't expect much different.
Nobody gets into the startup business just to be average. You've got to have big ambitions: change the world, make a fortune, get famous - or perhaps all three. The scrutiny that young dotcoms are under means very few entrepreneurs are simply hoodlums who think they'll blackmail their way to a retirement fund. But there are two real exit strategies for a startup founder: to flip or float. Option two is disappearing fast....
The post comes in response to Tom Foremski's post about disruptive startups selling out to the very companies they should be putting out of business. Foremski's is a fair critique, but as The Guardian notes, it may be that startups have little choice but to succumb. Entrepreneurs like cash, too.
As for open-source startups, Tim O'Reilly posited a year ago that open-source disruptors would mostly end up feeding the hands that they had been biting: "I will predict that virtually every open-source company (including Red Hat) will eventually be acquired by a big proprietary software company."… Read more