You should never be in a position where you depend on getting bought.
Why not?
Not that I disagree, but just for the sake of discussion. You may sell things, services or ideas, as well as you may sell entire companies. Is there a fundamental difference?
Consider relative bargaining power when you enter into acquisition negotiations. If you NEED to sell, then you will most likely accept any offer, no matter how bad, from the buyer. When you can take or leave any offer put on the table, you're in a much better position to bargain from.
Valid point, although same applies to any type of bargain, be it selling a mass product or closing a one-off deal. Any business depends on a need to sell, and there's nothing wrong about it, except you may want to pretend you are doing Ok. Acquisition is generally the same game, except it's meta-business.
After all, doesn't everybody know YC depends on a need to sell?
The market for startups is so illiquid that it's qualitatively different from buying and selling most other things.
You're doing a single big sale, instead of a flow large enough to generate a smooth curve in response to demand. And the buyers are extremely fickle-- so much so that needing to get bought makes you way less likely to get bought.
In addition to Kaizyn's excellent point, making acquisition your corporate strategy is basically admitting you have a product that can't survive on its own. That's a problem - why can't it work without acquisition?
When ownership of a popular company changes, it doesn't immediately make consumers dump the product. They rather wait and they can give up basically when the new owner is doing terribly wrong. In general, consumers don't care that much about ownership.
What if Steve Jobs sells his shares and leaves the company? You can't even tell for sure if Apple would become better or worse after that.
You're not Steve Jobs and your company isn't Apple, it's a piece of paper. When the first thing you say is "I'm looking to sell this company", myself as a customer thinks: "The guy running it is only in for a quick payday, I think I'll try someone else."
Acquisition is not a bad thing, planning on acquisition prior to you even building something worth acquiring is something that probably won't work out too well. If you instead build something lasting, finding people to give you money so you can retire won't be that big of a deal, really.
That doesn't make sense. Even if my whole strategy WAS to get acquired, I wouldn't plaster it in 48-pt font on the website. What do you think Twitter's strategy is? It's a pretty cool idea, but I fail to see how anyone could monetize it. Does that mean no one uses Twitter?
I think that's just a cliche and reality proves the opposite. A lot of acquisitions are going on constantly in all industries, and there is no or very little correlation between that and sales.
Do you have anything to prove that? I don't have anything to prove my assertion (other than personal opinion) so I'd be interested if you had something.
Can't remember when was the last time that change of ownership influenced my decisions on buying or using products, at least immediately after acquisition. Of course new owners can dump the product, but likewise they can improve it. I didn't think about it before starting this discussion, but it seems to be true.
Why not?
Not that I disagree, but just for the sake of discussion. You may sell things, services or ideas, as well as you may sell entire companies. Is there a fundamental difference?