Facebook Acquires Drop.io

Facebook's recent talent acquisitions sort of make sense to me from Facebook's standpoint (good, entrepreneurial talent is hard to find), but I wonder how the founders, employees, users, and investors feel about these relatively odd buyouts.<p>This drop.io deal sounds a lot like the Hot Potato acquisition from a few months ago: in both cases the startups were well-funded, but didn't have much traction, and then Facebook paid 8 figures to essentially buy the main founder (Sam Lessin at drop.io, Justin Schaffer at Hot Potato), and essentially let everything else die (the sites were shut down, the technology scrapped, other employees weren't hired by facebook, etc.)<p>A few questions for HN:<p>- <i>Is Facebook paying too much for these founders?</i> (They're basically shelling out a $10 MM signing bonus that lets these entrepreneurs placate their investors, and then come to Facebook. (Accept the founders only get a fraction of the money, obviously). <i>Is it worth it?</i> What are other new Facebook executives paid in signing bonuses?)<p>- <i>What do the investors think about this?</i> (Are the investors in Hot Potato and Drop.io happy to get a modest return instead of nothing (because these companies hadn't taken off yet), or are they frustrated that these companies ended somewhat abruptly?)<p>- <i>How do the employees feel?</i> (Does it feel like success for them when the whole point of the acquisition is really just to buy their boss? Obviously they get money for their equity, so maybe that trumps any other feelings.) [Full disclosure: I actually work with one of the co-founders of Hot Potato (who didn't go to Facebook), so I know his opinions on this issue, but I'm still curious to hear others' thoughts].<p>- <i>How do users feel?</i> (Are these buyouts fair to them?)<p>- And lastly, <i>Isn't there a slight paradox with the fact that these founders are being plucked at such high premiums because they're brilliant leaders, and yet, in both the cases of Hot Potato and Drop.io, these startups weren't runaway successes?</i> In other words, doesn't the lack of clear success of these startups undermine the basic premise that the founders deserve $10 MM "signing bonuses"?

It took the longest time for me to understand what Drop.io did. And during most of that time I was a NYC entrepreneur.<p>It's hard to build a real company if no one understands what you do. Maybe they would have had a better outcome had they hired a CEO who could create &#38; communicate a cohesive vision.<p>But that's just me.

This was a sale of near last resort.<p>This was not a "win" or an "exit" by any measure.

I always wondered how Drop.io made money. I use it all the time for one time file sharing drops, but they never had anything to sell me.

Congrats to Drop.io. In 2007 I presented my start-up at the New York Tech Meetup (<a href="http://www.businessinsider.com/2007/11/nytech-meetup-at-iac" rel="nofollow">http://www.businessinsider.com/2007/11/nytech-meetup-at-iac</a>). It was an odd meetup as only two unknown start-ups presented that evening, mine and a complete unknown, Drop.io who launched at the meetup. Other presenters were established companies presenting new products.

Hm, someone just asked me this week if their data will last on Drop.io--I told them yea for sure, they've been around for a long time, they're not just gonna shut down all of a sudden.<p>And then this.

Does anyone know the deal price?

Drop.io has very interesting technology; I think it deserved more than a talent acquisition.<p>Their company had a positioning problem. They built a platform that did something very unique (abstracting the coolest features from XMPP into an HTTP/RESTful API) and yet the takeaway for most people is that it's "a file sharing service."<p>Had the Drop.io team done a better job communicating their value proposition to developers with clarity and aggressively positioning their service, I think they could have had a big following.

My first thought was to take Drop.io and create a Google wave out of it. Now that Rasmussen has defected to Facebook, this may be true(<a href="http://techcrunch.com/2010/10/29/rasmussen-facebook-google/" rel="nofollow">http://techcrunch.com/2010/10/29/rasmussen-facebook-google/</a>)

seems like just a talent acquisition to me

I'd love hearing more drop.io alternative suggestions from others. Dropbox and Tonido have been mentioned, but they really aren't the same thing.<p>My band lives in various areas of the country, and we share mp3 files via drop.io. We're able to comment on each riff/song, link directly to the files, get updates via RSS, and even listen to the mp3s without downloading them.<p>Anything else like this exist?

Maybe some should copy their business plan and enter that market niche they occupied (assuming their plan has been successful so far).

Obviously not for their ability to build scalable blogging services (dropio blog site currently down) ;)

That's too bad, I always recommended the service for easy collaboration and sharing, was one of my favourites.<p>But well, Facebook will hopefully make good use of the technology and the many channels drop.io had already incorporated to extend it's group collaboration options.

A replacement for Drop.io is already in the works, I imagine. (And Dropbox won't cut it for a lot of people; it's not as straightforward to do a simple fileshare, and there are other cool features [e.g. RSS] that Dropbox doesn't do.)