Big Tech ‘Acquihiring’ Is an Ugly But Useful Trend
Meta and Google’s AI talent grab may lead to more sustainable tech companies.
Mark Zuckerberg, chief executive officer of Meta Platforms Inc.
Photographer: Drew Angerer/AFP/Getty Images
If you’re a venture capitalist, you dream of backing the next billion-dollar startup to one day feast on the returns of a sale. The buyer? A gargantuan tech company, of course. But these days, Big Tech isn’t buying so much as “acquihiring” the most promising artificial intelligence firms, specialized deals that scoop up the industry’s hottest talent while avoiding antitrust scrutiny, often by leaving behind business operations, a.k.a. the husk of a company.
The phenomenon has been great for tech giants who can remove potential rivals more cheaply, but it’s left venture capital investors in a rut with fewer returns than they would have expected from a traditional sale or even an initial public offering. How they react could set the whole industry on a different path and if we’re lucky, a better one.