

Spin-in startups from Cisco - vkdelta
http://www.businessinsider.com/why-cisco-showered-three-men-with-billions-2014-9

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tptacek
Cisco is famous for this; if you work in a field where Cisco is a potential
acquirer, your company has probably had several meetings with Cisco BD.

There's a downside. A skilled PM or engineer in Cisco who gets a product MRD
has a choice to make. They can keep their heads down and implement internally,
or they can jump ship and start a company knowing that Cisco wants it in the
future. To make matters worse: it's not exactly unlikely that Cisco will buy a
company to get that product _even if you do a good job implementing it
internally_.

It's not just MPLS that Cisco "spins in". I know people without the MPLS
cachet that have done the same thing at Cisco several times.

~~~
mathattack
I've known folks who left Cisco on the assumption that "The mothership will
buy us, and I will get my old seat back." It didn't work out that way, though
the folks wound up doing fine anyway.

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beambot
I hear about lots of companies trying to do "internal startups." If your
company is contemplating this.... then reading about Cisco's "spin in"
successes is mandatory.

I keep trying to tell people: If corporate "startup" founders don't have
massive upside potential (spelled out in contracts), then it's probably not a
"startup." It's just another way for the company to extract more productivity
out of salaried employees. Over the long term, equity-starved founders will
have to endure insane stress, massive efforts, and other startup "glass
chewing".... This will be challenging if founders don't have the potential for
a big payoff upon success. For example, this is why VCs are so concerned about
ensuring founders have enough skin in the game.

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salem
Cisco does this because they suck at assessing performance of, remunerating,
and retaining top engineering talent.

The best engineers figure out pretty quickly that they'll get more interesting
work and more money by riding the Cisco-Juniper-Startup-Cisco merry-go-round a
couple of times.

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mathattack
Is it that Cisco sucks at this, or do all big companies suck at this?

At some point "Getting along with others" trumps "Bringing in money" and
"Building great things" (or combined, "Building great things that people will
pay for") at big companies. The result of this is a bunch of "Well rounded B+
employees". Well rounded B+ employees don't change the world.

For every company that's 20+ years old with 10,000+ employees who does a great
job managing top engineering talent, I can point 5 that do it awful. (ok,
let's not go through that exercise, but it's the point...)

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salem
Well, you'd probably find that those 1/5 companies that don't suck at managing
engineering talent are probably run by former engineers, not former sales
guys.

The best career options for engineers in Cisco are: * sales engineer (not
really engineering) * become a manager * jump ship to juniper * go to a
startup, maybe even get bought back by Cisco with a career boost * shoot for
the moon, stay and maybe become a Cisco Distinguished Engineer, which are like
unicorns

Ergo, rank and file engineers are not valued by management, like they are at
Facebook/Google/etc.

~~~
mathattack
Interesting that you comment on that. One ex-Cisco engineering friend of mine
went to both Facebook and Google.

I think the CEO does set the tone of which types of employees a company
values. I recall a quote (I thought was Joel Spolsky or Bill Gates) around why
the CEO of a tech company needs to be an engineer. It's basically that only
they can understand the important technical details to make big changes in
corporate strategies. There's also a component of knowing who to value.

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trevmckendrick
This is great, but how do they possibly come up with a fair price?

Even assuming Cisco doesn't want to screw anyone, what's MPLS's best
alternative offer if Cisco's offer is too low?

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qthrul
If a team consistently 'delivers' time and time again with a specific
structure and arrangement it makes sense that the same team would be
reconsidered -- time and time again.

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bsiemon
This is interesting. It seems like a large bureaucracy like cisco recognized
it's own flaws and used this method to get around the institutionalized
toxicity to crazy ideas.

You get to leave all the friction of creating new ideas in a large org behind.
The price seems incredibly steep vs just creating a company that is friendly
to new ideas (of course creating such a company is no easy task).

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bankim
From what I hear, Noiro Networks/Project is the next "spin-in" from Cisco
[http://www.networkworld.com/article/2176631/data-
center/litt...](http://www.networkworld.com/article/2176631/data-
center/little-known-cisco-open-source-project-among-contributors-to-openstack-
neutron-policy.html)

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petercoolz
This is one of the the few cases where Clayton Christenson's insights on
disruption apply. Insieme was founded on the premise of trying to disrupt
Cisco's existing business because Cisco cannot effectively do so from within.

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amirmc
Original article is at [http://www.businessinsider.com/why-cisco-showered-
three-men-...](http://www.businessinsider.com/why-cisco-showered-three-men-
with-billions-2014-9) (link currently points at a Yahoo copy).

~~~
dang
Thanks—changed from [https://www.yahoo.com/finance/news/why-cisco-showered-
three-...](https://www.yahoo.com/finance/news/why-cisco-showered-three-
men-121320914.html).

