They intend to enter this new space, using their technology and their people.
As a courtesy they offered to hire you / throw a lot of money at you.
What would you have had them do instead?
Not compete with you, because you're a precious snow flake?
Acquire you and treat you like a prima donna, giving you your own team and allowing you to take your own technical direction?
Why should Facebook - or any competitor - do either of these things?
Seems to me like they acted pretty reasonably here.
Of all the things you said, this struck me as the weirdest:
> Strangely, your “platform developer relations” executive made no attempt to defend my position.
What do you think the purpose of the “platform developer relations” executive is? To advocate AGAINST Facebook and for random outside developers?
I'm not a fan of the Facebook app (not a member) or the company...but in this case, the firm seems to be acting 100% reasonably.
If they had been upfront about their intentions with the meeting, he probably would have never gone.
What do you think the purpose of the “platform developer relations” executive is?
To advocate AGAINST Facebook and for random outside developers?
While it is true that he said the thought he would be demoing, I don't think the discussion about an acquisitions was a problem in itself:
I said that if Facebook wanted to have a serious conversation about acquiring my team and product, I would entertain the idea.
I think his problem was that Facebook were negotiating from a position of strength (and were honest about that), and he didn't like it.
It really is odd how ecosystem developers always seem to act so shocked when they realize that the prime developer (the one who wrote the API agreement) turns out to hold all the power and control.
b) Even if there is an implicit promise, in this case Facebook acted very ethically in offering to buy him our when they decided to offer the same features. I can't imagine a better way to have handled that situation from Facebook's point of view.
As you note, the trust involved is invariably abused, but always within limits - vaguely defined as they may be. What Dalton Caldwell is observing is that these parameters appear to be shifting.
That's FB's prerogative, and I don't object to their exercising it. But there were two ways to handle the change. The first was to buy Dalton out, shut down the project, but provide jobs for his team. The second was to do what they did with Instagram, preserving the product and the team, and letting things evolve from there.
It seems like going the latter route would actually encourage people who really care about products to build on FB's platform. The former route also provides incentives, but of a much lower grade, and only appealing to people who don't really care about the products they develop, and see the compensated shut-down / aqui-hire as their highest goal.
There is a difference between "using something against you" and a platform keeping their options open.
But, to quote Tim Bray from 2003:
They own the ground you’re building on, and if they decide they don’t like you, or they can do something better with the ground, you’re toast. They can ship their own product and give it away till you go bust, then start charging for it; and use secret APIs you can’t see; and they can break the published APIs you use. All of these things have historically been done by platform vendors.
My point is that no platform has ever behaved differently to how Facebook are now, and Facebook are at least offering money to companies they are planning on competing with.
People will continue to develop for these platforms, though, because they offer the incredible lure of money - they are were the users are, and where the users are the money is too.
Agreed, but an honest question [and I'm no fan of FB, but...]: how could FB have requested a meeting without acting in bad faith and without being dumb? Seems dumb for FB to say to Dalton: hey, we're about to launch a competitive product and, since you're going to be squashed, we wanted you to come in to talk about an aqui-hire. Now Dalton has inside-ish info on FB (which he will have post meeting anyways) and can run around telling FB's competitors that FB is bidding for his company.
I suppose one of the VPs could have pinged Dalton about meeting for coffee, but then, assuming the informal meeting goes well, Dalton still has to meet all the other VPs, Dirs. Plus FB has a lot of these conversations with companies (I've been in 3 separate ones with 2 companies), so this is kind of the process.
I don't particularly see a better way for FB to handle the situation. Were I Dalton, I would have given myself some cool-down-room and, rather than blowing off the discussion, would have engaged the folks in a discussion and then told everyone that I'd get back to them first thing in the morning. Then I would have gone for a long run and let my thoughts settle. Or at last that's what I did when this happened to me 4 years ago.
I was hoping the outcome of this meeting would be executive-level support for my impending product launch.
What executive-level support would they give him except to buy him/his product? The bad faith here is going into this meeting with no intention of entertaining their obvious position.
If Facebook wanted an acqui-hire from this meeting here, they sold it awfully poorly. They don't have to care, of course, they'll likely just look elsewhere and scoop up 5 people to do the same thing, but from a business perspective this meeting would have seemed to be a waste of time for all concerned. Again, FB has the cash so who cares, but to drag people in with the hope that they'll forget themselves and jump at whatever opportunity is presented. They're taking time and attention away from the thing that attracted them to this person.
Heck, that they kind of throw offers around like this is kind of a lesson for future targets simply to triple their ask. "Sure, $50MM all cash." Screw those jerks.
Let's not insult Dalton. Let's assume Dalton is a smart guy and not a naive guy, but that he's in an unfamiliar situation and that THIS SHIT IS HARD. It's easy to sit on the sidelines and judge. It's quite another thing to figure out what to do when: you're a VP at FB who wants to talk with Dalton about an aqui-hire (seriously, how do you do this?); and when you're Dalton and you receive an email from said VP asking for an audience [what kind of audience?!?! who knows.].
>They could simply have explained their position in a way more
>appropriate for the kind of meeting they had portrayed.
My original comment suggested that they couldn't. You haven't provided any evidence to the contrary (in fact, you've suggested my "dumb" route without saying why it's not dumb). Let's assume everyone is a decent person [AFAICT this is a reasonable assumption]: this is not a soap opera; this is trying to figure out how to have a tense conversation with someone you respect.
>Heck, that they kind of throw offers around like this is
>kind of a lesson for future targets simply to triple their ask.
>"Sure, $50MM all cash." Screw those jerks.
This is a very dangerous comment. Of course, there are anecdotes to the contrary, but, by and large, few think the way you suggest they do and I'd warn fellow readers to take this as an anti-pattern. Those playing the game who get to the aqui-hire level are very high performers, not sell-outs. To suggest that the aqui-hirers are fools from whom to part money or that aqui-hires are sell-outs is to demonstrate extreme naivete. Google's top line really can benefit by adding high performance teams and Google is willing to pay for it. This is rational. At the same time, an acquired CEO, such as Kevin Systrom, can be happy that his biggest, in fact existential, competitor is now his partner. This, too, is rational.
Above all, this stuff is both hard and subjective. Let's look at how to use it to be more effective, rather than how to tabloid-ize it.
I don't have to provide evidence of an opinion, so I don't know where you're pulling that from.
My original comment suggested that they couldn't.
how could FB have requested a meeting without acting in bad faith and without being dumb?
Really? First of all that appears to be a false dichotomy. Secondly, they have a lot of brains at FB, yet idiocy and bad faith were the only two possible motivators for the meeting? They can figure it out, and if they can't, well, maybe they take the more-informative route.
Saying you are at a disadvantage for having everybody on the same page and not being oppositional or predatory is a sign of a bad mind to me. Can't tell him in advance that it's really about acqui-hire? Pretty much the same kind of arbitrary rule as "don't call her for three days." If you want to go through life accomplishing your goals in an antagonistic way, then follow their examples, but engaging in business this way in terms of romantic relationships is "The Rules" type poppycock. I'm not even going to address your assertion and denigration of decency and information as "soap opera."
Oh, but they "couldn't." How powerless FB is in this situation! How ever did they find themselves so?
this is trying to figure out how to have a tense conversation with someone you respect
Isn't that tension entirely related to preserving the hustle? Let's all shed a tear for the difficulties FB has in maintaining a powerful negotiating position.
Thing is, in this case I would say that what you identify as "tension" is a reflection of their powerlessness. Obviously they wanted him on board rather than building it themselves with other people, by sheer dint of coming to him before what other people wind up being their follow-on choices. So the hustle was functional in that they just decided to wield the bat of money that apparently is all they have to offer when manners fail them. Of course Mark Zuckerberg is known to be a rude person, so we can also see this episode as evidence (as you so require) of the fish rotting from the head.
To suggest that the aqui-hirers are fools from whom to part money or that aqui-hires are sell-outs is to demonstrate extreme naivete
Hey, all I'm saying is that if you're open to selling in the first place and FB comes sniffing around, ask for more than you would normally when being ambushed in a meeting. And yes, it's foolish to treat someone you want to work with in the way that they did here. Perhaps their negotiator end-points aren't as highly-performing as you say the acqui-hire targets are.
But I appreciate your point: decency is too much to ask of Facebook.
I thought that I covered this in my comment under the "dumb" option. I don't mean to be disparaging, but I'm not sure how else to take the suggestion, so switching to a not-great analogy:
Your suggestion is sorta like saying that people should walk into a car dealership and say "I want to buy this car. No, not that one. THIS car." It's a classic negotiating fail. If you know they're going to buy the car/company, you're going to milk them.
Of course, FB may think that THIS car/startup is absolutely perfect to acquire, but it's unrealistic to expect them to reveal that bit of info.
It just so happens that what FB were selling was a position of some repute within their organization, which they not only failed to do, but they misrepresented the product in the first place.
I don't understand why this is a big issue. What was the cost to him in going to this meeting? It would hardly have changed the outcome (outcome: he declines their offer and they build a service which clobbers his.)
Your team doesn’t seem to understand that being “good negotiators” vs implying that you will destroy someone’s business built on your “open platform” are not the same thing.
He then goes on to call out the root-cause of the problem as FB's understandable but unfortunate focus on ad-revenue. This puts them at odds with the developers who use the platform and that's clearly not a good dynamic. Both MS and Apple have long understood that getting developers and keeping them happy was essential to keep a platform fertile.
EDIT:fixing typo/poor construction in last sentence.
Microsoft refined the practice to the point they coined a new term for it:
As a recent example from Apple, they are now requiring sandboxing in the App store, which is heavily messing with a number of developers. But they are not sandboxing their own applications.
EDIT: this comment appears to be unpopular? what's the disagreement?
EDIT: Also, I should point out that apple didn't used to mess with developers, probably because they were primarily a hardware company, with low market share, so developers were key, and there was no competition. However, they have expanded and are now also a services company, so they have an incentive to mess with the environment in order to defend their services against competition. Microsoft, conversely, made quite a bit of money off of it's office products, so always had a reason to manipulate the environment.
Time, both in the meeting and in preparing, and in information transfer. He didn't specifically say what he went through, but he may have divulged pieces of the puzzle that they were unaware of.
In retrospect, our contact with the other side that had set up the meeting hadn't properly communicated to us what the meeting would be about, and presumably had not communicated much with his side about what they were looking for at this stage.
Their side was basically dysfunctional, with each person on their team having a different agenda.
I wouldn't say that meeting was mal-intentioned, just that their company was really screwed up.
Facebook may be in a similar stage at certain levels.
a) Facebook will knock on his door again at a later date asking to "acqu-hire".
b) Facebook will eventually release something in-house that will compete with his app (and most likely win due to Facebook's large momentum).
With the impending doom stuff aside, I still don't think that he should've expected getting exec-level support for his product walking in to the meeting. Facebook doesn't _need_ to give him anything. So yeah, he wasted his time, but that's _his_ problem, not Facebook's.
Also, relations does not mean advocate. He has relations with the customer, he is not obliged to advocate their views. Especially not when it goes against FBs interests.
Unfortunately this is a business. Not a university, non-profit or a government entity.
As an example from tech, I believe HN's 'jf' used to be a startup-relations person for Microsoft, whose job really did involve trying to advocate for their needs within Microsoft, reporting out of the product groups' normal management hierarchy to make sure he was giving them third-party input.
I definitely understand your point but I don't think it is correct to use the phrase "not that uncommon" with respect to "for-profit businesses" without defining what types of businesses you are referring to.
The overwhelming majority (anecdotal of course) of for-profit businesses do not have anything like an ombudsmen. I would agree that with respect to newspapers that statement would be correct from what I've seen and probably universities.
I wouldn't want to speculate on the percentages here, but if we believe the numbers as far as the amount of businesses of all sizes that are out there, I think it's safe to say that the majority don't have an ombudsmen. So I would say it is uncommon.
no, thats marketing.
Dev relations works with you once you are already using the platform. Don't get their intentions confused. They may be on your side with bug fixes and feature requests, but if you try to do something that goes against their company, why the hell would they be on your side?
The implication is that by having a large ecosystem with lots of developers, the company will benefit, but in this case, FB appears to have shot themselves in the foot.
Not compete with you, because you're a precious snow flake and
Acquire you and treat you like a prima donna, etc.
add nothing other than nastiness to Not compete with you and Acquire you, etc.
"You" did not refer to a generation, but to a person, so the language was personally insulting. The bar for personal insult is much higher and this comment doesn't pass it. First, the OP did nothing to deserve it, so it was out of place. Second, delete the insulting language and the comment not only doesn't lose information, its point (defending Facebook) becomes clearer. There was no need for arbitrary sticks in the eye. That's the meaning of "gratuitously rude".
I do think that the author's post came off as somewhat precious. Saying Not compete with you, because you're a precious snow flake? was less polite than perhaps is ideal, but OTOH the author's post was also less-than-polite.
 "I didn’t want to believe your company would stoop this low. My mistake.", "rotten-to-the-core “platforms” like Facebook", etc
Far be it from me on the day after Gore Vidal died to say that snideness is always a bad thing, but the community here is fragile and simply can't withstand the free flow of vitriol.
This argument has been made for likely as long as the human race has existed and is completely worthless. May as well say you walked up hill both ways through snow on your way to school every day.
And you try and tell the young people of today that, they won't believe you.
If Facebook went from expressions of support for the project to hostility, I think anyone would feel they'd acted in bad faith.
It's not illegal, and it's a fair point that developers should anticipate Facebook's conflicting interests. But it's also fair to publicly shame sleazy behavior when you see it.
It's one thing to use Facebook for authentication. It's easy and takes little investment. However, building a REAL product on the platform is a risk. If Facebook behaves like this, they show that it's a risk NOT worth taking, and they devalue their own platform, putting short term gain (product) over long term gain (platform).
Microsoft and Google are doing it with hardware. I imagine the phone/tablet manufacturers had a similar reaction as this guy, but didn't go blogging about it on the web. It's good for us that he did, because OEMs talk to each other in meetings. Small time devs best communicate a company's intentions via the web.
That said, the real difference is that Microsoft's platform was better. It offered more power for less risk.
You're absolutely right, I would. The OP has a point.
But let's be honest here, we're talking about a multi billion dollar company with thousands of employees, now traded on the stock market, so presumably aggressively trying to spin a profit.
Expecting said company to be "nice" is naive at best.
Nothing wrong with it at all. Go for it.
Let me know how that works out.
Yes, I agree that it is a sad state of affairs.
Whether you accept it or not, this is the world we've created for ourselves.
(Obviously you do accept it, as evidenced by the lawyers you mention)
What a depressing statement. Doubtless true but what a revealing and totally awful thing to take for granted. So now we live in a world in which not only are corporations people (thank you Judge Roberts) but they are psychopaths with no social conscience and we all take that pathology for granted.
Enjoy the next century. :)
In fact, this completely confirms my previous post from two weeks ago:
>All these aquisitions are more insidious, they are being done by the big players to stifle diversity in the market and continue to solidify their leads on online services under the guise of talent acquisition to better their companies - rather its an effort to prevent that talent from building something that would be a detriment to their positions
As well as:
>The acquiring of the teams is defensive in that they take that team and their IP etc off the market from their competition. It is offensive in that it squashes any possibility that whatever service it was the startup had would compete for their similar service.
>Attention is the resource that social services are harvesting from their users and monetizing.
Companies that provide features, utility and services that keep the attention of users (especially when providing no physical product) are those that will have longevity.
So, capturing those that would build things that direct user attention away from your product is critical to these huge companies.
Deception is occasionally a necessary tactic, but it would be insane to try to argue that it is a behavior that creates economic value. It should not be the expected default behavior, and in fact, is not. Which is why there are both civil and criminal penalties for fraud.
Deceptive behavior that is less than fraud may not be illegal, but it's still shame worthy in my view.
If we swapped out companies with strangers and HN with facebook, would these people be responding to their friends posting venting comments about whistlers on the bus to work with "It's a free country, they are allowed to whistle on the bus, so shutup."? To be honest, I don't think so. I think the reason this reply is absurd is patently is likely obvious to them when the subject of the criticism does not involve a corporation. It seems as far as they are concerned, as soon as a company enters the picture, all criticisms become invalid if they do not involve law-breaking.
Why this is the case I can only guess.
Because in contemporary North American culture the expectation for a company is basically sociopathic behavior within the law. But the expectation for an individual person is ethically aware and polite behavior in the face of public scrutiny.
Too many people playing poker games instead of building a world where we all get better lives.
I expect companies to not act ethically. In other words, I think of myself as a realist and this just seems to be how companies are going to act.
On the other hand, I expect them to act ethically. Meaning ethical behaviour is the behaviour that I demand from them.
Like when a parent says to their teenage kid who refuses to study for an exam, "Well I expect you to get an A". They don't expect that, but they do expect that of them.
Maybe these two sorts of "expect" get shorted out when corporations enter the picture? On the other hand, perhaps the expectation of a corporation in both senses really is sociopathic behaviour. All that "duty to the shareholders" crap...
I could invite you over to my house for dinner, and then ask you to pay for the raw materials after you've eaten. Legitimate, but still asshole-ish.
Legitimate is a low-bar.
It may be legitimate, but that doesn't mean there aren't consequences.
How many developers would continue using Facebook's platform if they knew Facebook would kill their product on a whim?
Those exact words have been uttered about both Microsoft and Apple in the past. Both have been wildly successful. At the end of the day developers will follow where the money is and absorb the risk.
Sorry but I don't think you know what those words mean.
People who do, know that the business of an infrastructure providers revolves around SLAs and contracts.
No good deed goes unpunished. Moreover, it's just not smart to publicly pick a fight with Facebook after they offered to acquire you. If you're the guys on the other side of the table, you might well brand this guy "unreasonable" and reckon that Kevin Systrom beat him once (score of $1B to $0), and Kevin is now playing for Facebook.
Seriously, this was not a good move on Dalton's part. As for this ("perhaps the public markets...will give you the time and goodwill to fix the obvious structural flaws"), he must be joking. Facebook has helicopter problems. Their dilemma is whether they are worth 20 billion dollars or 100 billion dollars. For Dalton to lecture Zuck in this tone, when Zuck has lapped him like 1 billion times over, and after they extended him a hand in good faith...just not smart.
Social media platforms should not be ad-supported.
This is just a continuation of that theme. He's saying, ~Your employees are doing asshole things to 3rd party developers, even though you're calling it a platform, because they have bad incentives, and that bad incentive is coming from the search for ad revenue~
Essentially, he's not so much mad at Mark, or even really caring whether Mark reads it or not. This is another piece of proof (to him and others that might listen), that social media platforms should not be ad-supported.
"The only way to get fulfillment is to help other people that believe what you believe." - Simon Sinek
You should watch the TED video where Simon Sinek talks about this. Dalton is basically putting this crazy idea out there about a non-ad supported social media platform (gasp!), and trying to find people who believes what he believes.
And, as a for profit business, they don't even have to hit anywhere near 100%. They just have to do well enough in how they operate not to loose business or somehow jeopardize what they have. It's really that simple.
This is a story that prior to the Internet nobody would ever hear about. No journalist would tell this story except in a magazine piece maybe that had an agenda and wanted to paint a picture.
This tale goes nowhere near even scratching the surface of how business operates. Spying. Payoffs. "Cut off their air supply" (Microsoft/Netscape)
Here's a story from when I started in business years ago. I called a friend of my fathers for a reference on someone who had worked with him in the past. He said "hmm, Bob left his job? Hmm." and then gave me a nice reference on him. Before I knew it he had hired Bob and basically told him "he's a startup you are wasting your time". I lost out on hiring Bob. This was a friend of the family. That may or may not be how any one of us would operate but in business as you say you can't be "a precious snow flake".
natrius: "Did they threaten to revoke API access?" (http://news.ycombinator.com/item?id=4325586)
dalton: "yep. That was presented as an option they could use by one exec, on a phone call." (http://news.ycombinator.com/item?id=4325593)
What they'd really be paying for is avoiding exactly this situation they're in now, with him talking quite loudly about how they shut him down. Can't blame 'em for trying, but they need to suss out their target a bit better before threatening them.
Or is Dalton complaining publicly now in the hopes that Facebook will pay him more later than they would have if he'd just gone along with their proposal now?
(Honestly curious: I do not have an opinion yet.)
Whether or not he is right, I'll give him a lot of respect for sticking with his guns and turning down something so outrageously tempting that hardly anyone else has turned down ever, just to chase his dreams. Props Dalton, and whether or not you get it, you deserve congrats and success for this.
When I do think about Dalton's motivations, I think he made a very risky bet and lost, and he's probably a bit angry with himself as much as he is with anyone else. Nothing wrong with that, I'd probably feel the same way.
It's Facebook's platform. Sometimes they are going to create internal products that compete with developers' ideas. The fact that they brought you in, explained what they were doing, and raised the possibility that they were willing to give you what I assume to be a boatload of cash to compensate you for your efforts seems almost comically generous to me.
The simple fact of the matter is that they CAN crush your business. They seem to be cognizant of that fact and were wiling to do something to help you. All I can say is that I'll bet most people reading this wish they had this kind of "problem" and would be writing "thank you" letters to Mark Zuckerberg, even if we ultimately rejected the offer. The title of this story could easily have been "This Just In: Facebook Has a Heart".
If FB did not declare itself a platform...if it had not encouraged others to build on its platform...if it had not encouraged DC to build his product on this platform...then you would be right. But if you are a platform, if you do encourage others to build on your platform (which is the whole point) and if you encourage a company to continue developing a product then it is not right. It may be realpolitik. It may be that having done all those things the platform company realizes that something it has encouraged is more strategic than it had realized, that it doesn't want a third party owning that product and it has to reel back its promises (which is what is sounds like here) but that is (a) a crippling result for the poor developer who took you at your word, and (b) and blow to your credibility as a platform. One incident like this won't kill you. Two won't. But at some point people just won't develop on your platform because there's no trust. ALL successful platforms have to walk this tightrope. Some do it better than others.