Acqui-hiring or Acq-hiring (a portmanteau of "acquisition" and "hiring", also called talent acquisition[1]) is a neologism which describes the process of acquiring a company primarily to recruit its employees, rather than to gain control of its products or services.[2][3] Ben Zimmer traced the derivation of the phrase to a blog post in May 2005.[4]

Talent acquisitions can provide a relatively favorable exit strategy for employees, with the prestige of being bought by a larger company, combined with the typical process of hiring.[5][6] A risk to talent acquisitions are employees that are not interested in working within a corporate environment — which may cause them to defect elsewhere.[6]

By the early 2010s, acqui-hiring had become increasingly common in venture capital-backed startup companies, especially within the competitive technology sector (where skilled software engineers working for startups were considered lucrative). By March 2013, Facebook was the largest performer of talent acquisitions, with 12 over the previous five fiscal quarters. One such Facebook purchase in 2009, FriendFeed, brought several high-profile Google alumni into the company, including Bret Taylor — who became Facebook's chief technology officer shortly after the purchase.[7] Twitter, Yahoo!, and Google ranked alongside Facebook as a similarly major user of talent acquisitions.[8]

Typically, a company that performs a talent acquisition does not show an interest in the products and services of the target, which results in them being discontinued upon the purchase (so that their staff will focus exclusively on incorporating their knowledge into their new employer's projects) or some time afterward. The file sharing service Drop.io was shut down after its 2010 purchase by Facebook, while FriendFeed was left dormant (with no new feature development and a slowly shrinking user base) until 2015, when it was discontinued.[7][6][9]

The opposite of acqui-hiring is also possible; when Cisco closed its Flip Video subsidiary despite good sales, two years after acquiring the company in 2009, David Pogue of The New York Times speculated "Maybe, in fact, that was Cisco’s plan all along. Buy the beloved Flip for its technology, then shut it down and fire 550 people".[10]

References

  1. ↑ Coyle, John F.; Polsky, Greg D. (16 April 2012). "Acqui-Hiring". Duke Law Journal. 63: 281. SSRN 2040924. Retrieved 10 July 2020.
  2. ↑ Sullivan, John (10 December 2012). "Acqui-hiring: A Powerful Recruiting Strategy That You've Never Heard of". ERE.net. Archived from the original on 27 October 2016. Retrieved 20 April 2013.
  3. ↑ Yarow, Jay (10 August 2012). "Why So Many Startups Are Being Acqui-Hired". Business Insider. Retrieved 20 April 2013.
  4. ↑ Zimmer, Ben (29 September 2010). "Buzzword Watch: "Acq-hire"". Visual Thesaurus. Retrieved 27 May 2013.
  5. ↑ "The Vanity of the "Acqhire": Why Do a Deal That Makes No Sense?". All Things D. Retrieved 23 May 2013.
  6. 1 2 3 Helft, Miguel (2011-05-17). "In Silicon Valley, Buying Companies for Their Engineers". The New York Times. ISSN 0362-4331. Retrieved 2019-04-19.
  7. 1 2 Wagner, Kurt (2015-03-09). "Facebook Officially Shuts the Door on FriendFeed". Recode. Retrieved 2019-04-19.
  8. ↑ "Facebook leads growing acqui-hire craze". Upstart Business Journal. Retrieved 23 May 2013.
  9. ↑ Parr, Ben (29 October 2010). "Facebook Acquires Simple File-sharing Service Drop.io". Mashable. Retrieved 2019-04-19.
  10. ↑ David, Pogue (April 14, 2011). "The Tragic Death of the Flip". The New York Times. Retrieved August 27, 2011.
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