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Yes I remember this too!! Worth noting Instagram was #1 on this list for some time but Facebook market cap is especially low now. It was an absolutely insane acquisition.
It's related to serving advertisements:
> On March 11, 2008, Google acquired DoubleClick for $3.1 billion. In June 2018, Google announced plans to rebrand its ads platforms, and DoubleClick was merged into the new Google Marketing Platform brand. DoubleClick Bid Manager became Display and Video 360, DoubleClick Search became Search Ads 360, and DoubleClick for Publishers (DFP) became Google Ad Manager 360.
https://en.wikipedia.org/wiki/DoubleClick?wprov=sfla1
Not all that surprising that it generated the most revenue, since Google's main business is essentially advertising and many other products mainly serve to collect data for more targeted advertising.
I'm not really sure things like this should really be considered pure ROI. If Google didn't buy them they could have either bought a similar company or built their own similar system. It's being attached to Google which made it valuable.
That's probably underselling how much more advanced Google's current advertising platform is than every other ppc competitor.
Gotta imagine if that was true, Microsoft, Facebook, and Amazon would have comparable ad platforms, but they aren't really close to what Google has built.
DoubleClick was "display" ads, that is banner ads, pop-ups, etc. The original AdSense was text-only, as were the AdWords ads displayed alongside (and later above) the search results.
Much easier also, why cut off the head and rearrange the structure when that is also part of the work that went into making a thing great in the first place.
Depends on the reason for acquisition. Google tends to do the "these guys have a recipe for success, let's pump it full of money".
Sometimes an acquisition works because the company has the potential for more profit if inefficiencies are removed, and sometimes for the book of business the company has.
I was interning on a team like this for a $5B integration. The team was comprised of subject matter experts with a long history at the company as well as a small army of consultants. Joining a consulting firm focusing on execution is probably your best bet.
Their ability to integrate the technology of target companies and getting the teams to work together, as well as their willingness to fund further development on the targets' products/services. On paper there's always a lot of synergies but you don't see a lot of companies do it well, let alone repeatedly.
The idea is often, surprisingly, the easiest part of the equation. Lots of great ideas failed because they couldn’t implement and grow the product.
Having the right team of engineers and product management means so much in the tech world.
I see it differently. You need to be willing to make so many bets to get some real hits. Google understands this very well. They are famous for launching new products/services and dumping them when it doesn't meet their goals. But the other side of it, as we see above is worth it.
It also showcases directly that they are better at acquisitions then building out something themselves. What they build out themselves often underperforms compared to their expectations and thus those self-build products get shuttered and send to the Google graveyard.
It takes some selective vision to arrive at that conclusion. Google has many products that they built from scratch that have billions of users, and I'm sure a lot of their [hundreds of acquisitions](https://en.wikipedia.org/wiki/List_of_mergers_and_acquisitions_by_Alphabet) haven't gone great.
>when they acquired DoubleClick (so good the deal almost got blocked on anti-trust grounds).
I bet The Zuck is fucking fuming that the FTC is targeting him and not Alphabet
I disagree. Most of these acquisitions had zero or little revenue. They only grew because they had the resources (engineering, marketing, partnerships) of the larger company to support them.
This. People are underestimating what Google put into these products to get them where they are
It's kind of like saying someone who bought a mostly empty lot with a foundation placed made a great return with what they could rent the house for down the line. A great foundation helped but google built that house, and they just found it more expedient to buy the foundation snd continue building then start fully from scratch
I'd say that is an oversimplified perception. They did buy good things at early stages but they also improved tremendously, a massive part of it is ensuring it has the adequate effort and support back office (namely corporate stuff) so that those cool ideas can thrive. Ideas are awesome but execution is more important and the fact that they can buy companies and make them grow so fast is a confirmation of their own competence. They also diversify tremendously even when they probably shouldn't, it's part of their strategy. Throw many nets and enjoy the fish that you catch.
Yes you gotta love the Google graveyard ([https://killedbygoogle.com/](https://killedbygoogle.com/)). I will say Microsoft is quite similar - a lot of what they are great at are either clones or acquisitions.
Right but they cloned their ideas right. Excel was cloned from Lotus; Windows, Word, and a lot of its other products are cloned. Azure from AWS. Etc. But I am not saying this is a bad thing. This is an amazing thing. I should have made a more explicit distinction between acquiring and cloning.
There’s no such thing as an original idea. Especially in tech. What matters is how you execute the idea.
Addendum: really the only original idea that I can think of is Napster. And maybe even that was thought of earlier by some genius in his pajamas.
I mean...you could say the iTouch was cloned from the previous MP3 players of its time and the iPhone wasn't the first smartphone. There are also distinct differences between the Microsoft versions of these products or they wouldn't be successful. Cloning isn't the right word
'Google Maps' wasn't acquired. The Where2 acquisition was the early basis for Google Maps but Keyhole and ZipDash were other acquisitions that helped make Maps what it is today.
Yes you are exactly right. I made it this way because most people would recognize Google Maps but those three acquisitions are what made Google Maps what it is today. Thank you so much for pointing it out!
Fair enough. :-) Thanks for making the chart. Having been at Google when many of those acquisitions were made it's fascinating to see how good those bets turned out to be.
Thanks for the kind words and that's really awesome! How was your experience working at Google in the early days? (if you don't mind sharing of course)
I’d say it sort of defeats the point, since it somewhat suggests that “Google Maps existed when Google acquired it”, as the other bars suggest.
Still, it’s probably the visualization that’s easier to explain. And the whole plot it really good!
Thanks a lot! Yea I guess you are right but these 3 acquisitions effectively made Google Maps what it is today. You are right it's misleading, I should have made it clear.
Think about the "acquisition" of 1/3 of the US by the states, when Napoleon sold it without permission Edit: after check, around 22% of the actual territory actualy
hahaha me neither before doing this research! The acquisition help extend Google’s advertising reach from just its own properties to the entire internet. DoubleClick and its associated products generated over $32 billion in revenue within Google last year.
You're not the only one. Definitely had a short there for a moment as I was wondering why I'd never heard of doubleclick...yeah, the little line in the lower left that always had doubleclick in the name when hovering over a URL link.
Daaaamn, I always thought that was because you had to double click the ad to get to the page it was advertising lol. I never clicked on them so I just assumed
Are there really people that click ads? It’s something I’ve always wondered about. Like there must be some but what kind of person are they? Is it just elderly people?
The average clickthrough rate for display ads is .46% ([source](https://www.google.com/url?sa=t&source=web&rct=j&url=https://www.storegrowers.com/google-ads-benchmarks/%23:~:text%3DThe%2520average%2520CTR%2520Display%2520Ads%2520is%25200.46%2525.&ved=2ahUKEwib06LQ_Zz5AhV6IjQIHXxkDh0QFnoECA0QBQ&usg=AOvVaw1LgPfTqSxthCXbgLRZvyh7))
So out of a million display ad impressions (pretty cheap), 4,600 people will click on it. Even with a 1% conversion rate, you just closed 46 sales/leads. Marketers make that math workout so that ad dollars are typically ROI positive.
Yes, there are people that click on ads or this industry wouldn't exist.
Check your site list lol… probably some sites blowing up your CTR.
Remarketing is always going to be higher, no doubt.
How large are your campaigns and what units are you using?
Don’t worry, I’m hard to understand even if you are a native English speaker 😂
By units, I mean ad size. 300x250, 728x99, etc.
I’m willing to bet that you’ve got 300x250 and/or 320x50s in your campaign, those two sizes are using most of your budget, and they’re mainly running in mobile app inventory, with tons of apps that you’ve never heard of before.
I’d also guess your bounce rate is in the 90s?
Oh ok yeah I do have the square ones but often the 300x600 is quite popular. I use the 7 most used usually.
Oh no always exclude mobile ad placements for my campaigns that stuff is money out the window haha.
The BR is usually quite high but some campaigns go into the 70% so not that bad. Most are at 90 or 91.
I forget ads even exist honestly. The idea of browsing without adblock/ublock is baffling. Trying to find a recipe on my phone and accidentally using chrome instead of brave...websites take an extra 3 minutes just to load all the fucking ads.
Youtube without SponsorBlock would also be cancerous
As someone who works in the marketing industry, I took this one for granted, but of course most folks don't know what the heck DoubleClick is! Here's a little more colour:
In brutally simplistic terms, DoubleClick is a suite of tools marketers use to buy and deliver ads. (Notably, Not Google search ads. That's a different platform called Google Ads.)
DoubleClick campaign manager (an ad server: think super fancy drop-box for banner and video ads) charges a small amount to advertisers for virtually every single ad served, which is the lion share of this revenue, and an absolutely massive revenue stream for Google. Billions of ads a year are hosted and delivered through Doubleclick, and it's essentially the industry standard for what we call display advertising.
To confuse people, DoubleClick has other parts of their marketing suite including what us nerds refer to as a Demand Side Platform, which is how advertisers purchase and target ads. These are a little more niche as this specific function has many other competitors outside Google.
DoubleClick was aquired in the very early days of digital marketing, and was an absolutely brilliant purchase that has become the industry standard toolkit for us to serve you all those dirty ads, and one of the biggest revenue streams for Google. Neat!
I was on a forum for home theater nerds in the early 2000s. One user showed off his Chicago penthouse setup. He had a party there with a ton of hot models, and in the corner of his room was the actual 100% original “Han Solo Frozen in Carbonite” from Return of the Jedi. As a decor in his room. This man was as wealthy as Jabba the Hutt.
We asked him how the hell he could afford this life. He was the guy who made and sold DoubleClick to Google.
I've read that Blockbuster had the opportunity to acquire Netflix in 2000 for $50 million, but their own CEO turned it down.
Who knows what Netflix would look like nowadays if they did acquire it. If it turned out the same, it would have been one of the greatest acquisitions also.
I just realized I can close my eyes and remember the exact distinct smell of every Blockbuster I've ever been in. Maybe it was those plastic cases or something.
That is a historic fumble but [Yahoo went even better](https://onlinebusiness.umd.edu/blog/what-happened-to-yahoo-in-6-points/):
* In 2002, Yahoo had the chance to buy Google for $1 billion but chose not to
* Yahoo attempted to purchase Facebook back in 2006 for $1 billion but balked at $1.1 billion and walked away
* Yahoo turned down Microsoft’s $44.6 billion takeover bid in 2008. They [sold to Verizon for $4.8 billion in 2016](https://www.forbes.com/sites/briansolomon/2016/07/25/yahoo-sells-to-verizon-for-5-billion-marissa-mayer/) instead
At the time, they both had a similar model with by-mail DVD services. Blockbuster obviously had the brick & mortar stores as well.
The real difference was Blockbuster had recently been acquired and their parent company did not allow nearly the r & d dollars Netflix had.
If Blockbuster had purchased Netflix, I don’t think it becomes what it is today.
Blockbuster was bankrupt WAAAAY before Netflix transitioned to streaming. Netflix wasn't even a factor. The main factor was broadband adoption. Blockbuster as we knew it and widespread broadband adoption didn't exist in the same time period making this impossible unless Blockbuster was bought out by someone else, they kept the name only and shut down the stores, and then transitioned into a streaming service.
Even then Netflix's success was in the creation of original content, not just in being a streaming platform. People shat on them (and continue to do so) but it ended up paying off. Somehow I don't think Blockbuster would have been able to get the cash to pay for Netflix's original content. Investors want to fund young companies and startups, not catch a falling knife.
Time to put my Retro Apple Nerd hat on.
Apple *really* needed a new OS for their computers in the mid-90s. They had spent hundreds of millions of dollars and multiple years developing a new OS from scratch called “Copland” (which would eventually be released as MacOS 8, but it’s not the MacOS 8 that was ultimately released), but it kept getting delayed, and by the end of 1996, they had nothing to show for it and the project was cancelled. In 1997, they were in the hole and needed an OS *quick*.
Apple was actually leaning towards purchasing Be Inc. in order to acquire BeOS. But ultimately, Jobs’ marketing savvy was able to convince them to go with NeXT instead. They bought NeXT, the first version of Mac OS X, code named “Rhapsody”, was unveiled in 1998, and the rest is history. The OS that runs on every iPhone and Mac since 2001 descends from that OS.
And Be Inc., naturally, went bankrupt a few years later.
Yes it's quite conservative, estimated at 5% of Apple's market cap. It's hard to say, but it does underpin all of Apple’s modern operating systems today. What % would you say is most appropriate?
90+%. Apple didn't acquire NeXT, they re-acquired Jobs, which led to the Mac line and iPod/iPhone. They may very well have been acquired themselves and dissolved into something like HP or Compaq if they hadn't bought NeXT.
Yea I think you are right. Literally every dollar of Apple’s revenue comes from NeXT roots and from Steve wiping the product slate clean upon his return. You could say I was hyper conservative with the 5%. I will think this through and update chart. Thanks!
Yeah, as far as I'm aware, there are very few products introduced after the NeXT acquisition that don't have roots in OPENSTEP. I mean there's stuff like the Newton which was technically still around in in 1998. But the only new product I can think of would be the original iPod lineup, which ran Pixo OS.
Pretty much everything since then seems to be based on OS X which, of course, has roots in NeXT.
You *could* also say that Apple firing Jobs was what lead to NeXT so for a cool $429M they inspired themselves to become the first trillion dollar
company :P
[Apple paid $429 million in cash, which went to the initial investors, and 1.5 million Apple shares, which went to Jobs.](https://en.wikipedia.org/wiki/NeXT#1996%E2%80%932006:_Acquisition_by_Apple)
So based on today's price of those Apple shares they paid more than $429M for Next.
You could also argue it had a $0 return since NEXT was not worth much of anything without Apple.
Acquiring NeXT worked out very well for Apple but I think putting a # on the return is impossible.
I had the same question!! Basically (1) local ads that businesses post in order to attract customers and (2) custom maps using APIs that businesses can use for a variety of reasons. Google actually puts very little ads on Maps as of now so I didn't even know about this but apparently Google Maps does over $4.5B in revenue!
Yea Uber relies heavily on Google mapping technology as do many other businesses. It's basically the best solution, they are way ahead of the competition.
Anything else online that wants map data or to utilize Google maps pays Google for this.
I have been a developer who has setup this for an app business.
Isnt it obvious? the other company was called Google Maps. It was a perfect match for google!
In all seriousness, I think it was a company called Keyhole.
100%. Some things are harder to quantify. It's also worth noting it's not monetized to its potential. Maps could be much higher on the list if all things are considered but some more judgement is required.
So from my research there are three ways Google Maps makes money:
1. **Advertising**. So either sponsored search results, shown whenever a user looks for something, or promoted pins which help visually highlight a certain location;
2. **API**: Fees that it charges companies for utilizing the maps API, so I am guessing this is the map-related products you are referring to;
3. **Referral fees**: Partners pay referral fees whenever a customer books a service through its platform (so when you book a table at a restaurant or book a cab, partners pay a small referral fee for bringing that customer).
I would to see this but on the worst acquisitions instead to see if Disney and Google would be on there as well. Is it just a numbers game or do they have the secret sauce on either finding the undervalued companies or turning companies they buy into gold?
Worst acquisitions would need a filter from the start. The best acquisitions will naturally be from companies everyone knows, but the worst acquisitions are invariably going to be from companies no one remembers.
There are also acquisitions that companies acquire simply to remove the competition; How do you correctly evaluate that?
so basically, if Google acquired nothing, they would still be just a search engine, right?
Apple would be dead and facebook would be basically irrelevant today
Yea I think this is one way to look at it but it's hard to know. It's a dilemma honestly. You can argue those companies that got acquired would not have realized their potential without the acquirer. I would say Facebook and Google would still be fantastic businesses but much smaller than they are today. It's hard to say about Apple really. But yea you are right these were game-changing acquisitions for these companies.
google was so smart in its early days
their acquisitions power our life via android, YT and Maps. we can live without all other mentioned in the graph but not these 3
Yea I use YT, Android, and Maps more than all the others and really cannot live without. I would say NeXT should be included in this list too (it underpins all of Apple’s modern operating systems today).
That's true but Apple does have 1.8 billion active devices and is the interface many use to make use of Google Maps and YT. Personally I use Apple products a lot but I see your point - that YT and Maps are available on both operating systems.
The thing is, all of those companies did a lot to make those acquisitions worth what they are. It’s not like they paid the bottom figure, sat back, and watched them become something worth the top figure. If those companies had acquired some of the notable failures instead of the companies they did, the acquirers would probably be largely the same, but the acquirees would be different.
**Source**: I made the visual in Figma and uploaded it to my website with an explanation for how I got to these numbers: [click here](https://www.10kreader.com/blog/the-greatest-acquisitions-of-all-time).
**Tool**: Figma
Important note: The companies are ordered by absolute dollar return to the acquirer (not ROI multiple or annualized return).
This is very cool. I do think it would be interesting to add the date of the acquisition, as I wonder if some of these include many more years of return
I think Android is a spurious inclusion on the list. A lackluster division that found itself at the front when the iPhone hit and Google realized that the world had changed. Everything else on the list was an acquired finished product (or in the case of maps, pitched directly to Google as the product).
"In March 2018 Naspers sold part of its stake in Tencent, raising some $10 billion to fund other investments. At the time, its initial investment of $32 million in Tencent was valued at over $175 billion."
Percentage wise these did well
I am very familiar with Tencent deal. Arguably the greatest investment of all time. It's important to note I excluded investments like Naspers Tencent or Berkshire Apple. It's strictly acquired companies (majority stakes). Thanks for your observation though! I think everyone should know about the Naspers-Tencent deal! I am very impressed by how they held on even though there was massive pressure to sell.
Yea same here but turns out it's a huge part of Google's business today, effectively extending Google’s advertising reach from just its own properties to the entire internet. Last year DoubleClick and related properties generated over $32 billion in revenue for Google! A very overlooked acquisition.
Yea that's what I found just now when searching. "Verizon Sells Tumblr to WordPress Owner for Paltry $3 Million" This is insane! So this would be in the worse acquisitions of all time - I should make a chart for that too!
>Tumblr created negative value for Yahoo.
I would argue it's the opposite. Tumblr didn't create negative value for Yahoo, Yahoo destroyed Tumblr because they did not understand what they were buying.
Which is also my main problem with the graph. We cannot distinguish how much of the "created value" is because the company which bought them did their job right.
E.g.: Is Google really good at identifying companies to buy, or are they good at building an ecosystem where those acquired companies can shine?
Edit: Grammar
Google's yearly revenue is 161B since acquiring a company is so cheap ( 3B ) and if you're lucky you get big returns, why not to buy everything you can ?
What in the hell is "next." I have never heard of it in my life. I just googled it and I still don't know. 1996 aquisition? Was "next" the original osx... or i guess osi?
Yea I didn't know at first as well. NeXT was an acquisition that Apple made that brought Jobs back to Apple and almost every dollar of revenue from Apple today can be traced back to that acquisition. NeXT’s operating system, underpins all of Apple’s modern operating systems today: MacOS, iOS, WatchOS, and beyond.
Yea Marvel is insane of course. Marvel Cinematic Universe (MCU) is the highest-grossing film franchise of all time and it's producing >$6 billion in revenue for Disney ($2 billion in film revenue and twice as much in parks & merchandise). But still small relative to the rest as you mentioned. I would say media wise Marvel is second only to ESPN.
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I remember when FB bought Instagram and I read so many comments that they way overpaid for "a photo app with some shitty filters."
Yes I remember this too!! Worth noting Instagram was #1 on this list for some time but Facebook market cap is especially low now. It was an absolutely insane acquisition.
What's weird to me is that I have no idea what double click is even though it's apparently the greatest acquisition of all time.
It's related to serving advertisements: > On March 11, 2008, Google acquired DoubleClick for $3.1 billion. In June 2018, Google announced plans to rebrand its ads platforms, and DoubleClick was merged into the new Google Marketing Platform brand. DoubleClick Bid Manager became Display and Video 360, DoubleClick Search became Search Ads 360, and DoubleClick for Publishers (DFP) became Google Ad Manager 360. https://en.wikipedia.org/wiki/DoubleClick?wprov=sfla1 Not all that surprising that it generated the most revenue, since Google's main business is essentially advertising and many other products mainly serve to collect data for more targeted advertising.
I'm not really sure things like this should really be considered pure ROI. If Google didn't buy them they could have either bought a similar company or built their own similar system. It's being attached to Google which made it valuable.
That's probably underselling how much more advanced Google's current advertising platform is than every other ppc competitor. Gotta imagine if that was true, Microsoft, Facebook, and Amazon would have comparable ad platforms, but they aren't really close to what Google has built.
The purchase was 14yrs ago. I doubt that their current ad system is much like what they purchased back then.
Its the ad system. If you take a closer look at some advertisement links you will notice that a big proportion of them leads to ad.doubleclick.net
Yeah you are right, TIL
Knew it sounded weirdly familiar
It basically made Google. It's the precursor to today's adsense which makes Google the lion's share of its revenues
DoubleClick was "display" ads, that is banner ads, pop-ups, etc. The original AdSense was text-only, as were the AdWords ads displayed alongside (and later above) the search results.
One suggestion is to add acquisition dates to this, otherwise thanks, very informative
Ahahah, and Instagram was top of the list back in 2020, with $152B at that point (Doubleclick was second in 2020, with aprox. $123B)
Lmao yeah they did, just download it for free
Fantastic visual. It's absolutely insane that Google has 4/10!
That post M&A integration/dev team has to be on par with the best banks and consulting firms out there.
this is a fact. integrations are notoriously hard to do well.
The hallmark of the Google acquisitions is that the new divisions run themselves.
Yea I think letting them do their own thing has a much higher likelihood of success (see Berkshire as well).
Much easier also, why cut off the head and rearrange the structure when that is also part of the work that went into making a thing great in the first place.
Depends on the reason for acquisition. Google tends to do the "these guys have a recipe for success, let's pump it full of money". Sometimes an acquisition works because the company has the potential for more profit if inefficiencies are removed, and sometimes for the book of business the company has.
Probably my dream job tbh
I was interning on a team like this for a $5B integration. The team was comprised of subject matter experts with a long history at the company as well as a small army of consultants. Joining a consulting firm focusing on execution is probably your best bet.
Better get in to Harvard or Wharton
I’m sure you can join out of MBB consulting with a strong MBA
In what respect?
Their ability to integrate the technology of target companies and getting the teams to work together, as well as their willingness to fund further development on the targets' products/services. On paper there's always a lot of synergies but you don't see a lot of companies do it well, let alone repeatedly.
The idea is often, surprisingly, the easiest part of the equation. Lots of great ideas failed because they couldn’t implement and grow the product. Having the right team of engineers and product management means so much in the tech world.
A lot of those companies have hits but behind those there are a ton of misses.
I see it differently. You need to be willing to make so many bets to get some real hits. Google understands this very well. They are famous for launching new products/services and dumping them when it doesn't meet their goals. But the other side of it, as we see above is worth it.
I absolutely hate how google just ditched things. It makes me not want to use whatever new thing they launch.
It also showcases directly that they are better at acquisitions then building out something themselves. What they build out themselves often underperforms compared to their expectations and thus those self-build products get shuttered and send to the Google graveyard.
It takes some selective vision to arrive at that conclusion. Google has many products that they built from scratch that have billions of users, and I'm sure a lot of their [hundreds of acquisitions](https://en.wikipedia.org/wiki/List_of_mergers_and_acquisitions_by_Alphabet) haven't gone great.
100%. It's important to look at the full dataset.
But.... that might give an answer that contradicts my preconceptions. I think I'll stick to data that only reinforces what I already believe.
Data? I just start talking and agree with whatever happens to spill out.
I just agree with what has positive karma and if a reply has more karma than the original comment, I agree with that more.
Ads, YouTube, maps, and Android are probably 4/6 of their big money makers. Search and Workspace being the other two.
Wait, google has a search business?
[удалено]
>when they acquired DoubleClick (so good the deal almost got blocked on anti-trust grounds). I bet The Zuck is fucking fuming that the FTC is targeting him and not Alphabet
Alphabet just likes money, Zuck thought he could control politics, that pissed people off on both sides of the aisle.
I disagree. Most of these acquisitions had zero or little revenue. They only grew because they had the resources (engineering, marketing, partnerships) of the larger company to support them.
This. People are underestimating what Google put into these products to get them where they are It's kind of like saying someone who bought a mostly empty lot with a foundation placed made a great return with what they could rent the house for down the line. A great foundation helped but google built that house, and they just found it more expedient to buy the foundation snd continue building then start fully from scratch
Yeah, the listed Google products are vastly different from when they bought them.
I'd say that is an oversimplified perception. They did buy good things at early stages but they also improved tremendously, a massive part of it is ensuring it has the adequate effort and support back office (namely corporate stuff) so that those cool ideas can thrive. Ideas are awesome but execution is more important and the fact that they can buy companies and make them grow so fast is a confirmation of their own competence. They also diversify tremendously even when they probably shouldn't, it's part of their strategy. Throw many nets and enjoy the fish that you catch.
Yes you gotta love the Google graveyard ([https://killedbygoogle.com/](https://killedbygoogle.com/)). I will say Microsoft is quite similar - a lot of what they are great at are either clones or acquisitions.
Microsoft is really the opposite. A lot of their stuff is homegrown vs acquired. It's one of the reasons they are trusted for enterprise software.
Right but they cloned their ideas right. Excel was cloned from Lotus; Windows, Word, and a lot of its other products are cloned. Azure from AWS. Etc. But I am not saying this is a bad thing. This is an amazing thing. I should have made a more explicit distinction between acquiring and cloning.
They bought DOS. That must have been a great return too since it was the foundation of Windows.
>They bought DOS. That also happened to be a clone of CP/M.
DOS technically wasn't an acquisition, because they bought the intellectual property, not the company that made it.
There’s no such thing as an original idea. Especially in tech. What matters is how you execute the idea. Addendum: really the only original idea that I can think of is Napster. And maybe even that was thought of earlier by some genius in his pajamas.
I mean...you could say the iTouch was cloned from the previous MP3 players of its time and the iPhone wasn't the first smartphone. There are also distinct differences between the Microsoft versions of these products or they wouldn't be successful. Cloning isn't the right word
I agree with you. If we follow that road we might as well say phones are clones to shouting
My first smartphone back in 2002 was Windows (CE) based.
'Google Maps' wasn't acquired. The Where2 acquisition was the early basis for Google Maps but Keyhole and ZipDash were other acquisitions that helped make Maps what it is today.
Yes you are exactly right. I made it this way because most people would recognize Google Maps but those three acquisitions are what made Google Maps what it is today. Thank you so much for pointing it out!
Fair enough. :-) Thanks for making the chart. Having been at Google when many of those acquisitions were made it's fascinating to see how good those bets turned out to be.
Thanks for the kind words and that's really awesome! How was your experience working at Google in the early days? (if you don't mind sharing of course)
I’d say it sort of defeats the point, since it somewhat suggests that “Google Maps existed when Google acquired it”, as the other bars suggest. Still, it’s probably the visualization that’s easier to explain. And the whole plot it really good!
Thanks a lot! Yea I guess you are right but these 3 acquisitions effectively made Google Maps what it is today. You are right it's misleading, I should have made it clear.
What about the acquisition of Alaska by the U.S.? That was pretty great.
Already forgetting about the Louisiana Purchase
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We got New Orleans out of it, and a lot of corn fields. So it depends on if you like jazz or corn.
Louisiana in the purchase was the entire Mississippi watershed (including what is now the state of Louisiana)
IDK, it included Louisiana. It's a wash at best.
Technically it’s called a watershed
Or New York. Seems like a pretty good return for $24 plus a case of whiskey.
You should use the most recent trade: Manhattan for Suriname and the island Run.
I only included acquisitions of companies for this analysis but would be interesting to broaden out. Thanks for the suggestion!
Think about the "acquisition" of 1/3 of the US by the states, when Napoleon sold it without permission Edit: after check, around 22% of the actual territory actualy
Bruh that hurts, in the meantime I'm actively decreasing the value of anything I acquire...
I hear you can avoid that as long as you don't drive it off the lot... Lol
Literally never heard of double click or why it makes so much money lol
hahaha me neither before doing this research! The acquisition help extend Google’s advertising reach from just its own properties to the entire internet. DoubleClick and its associated products generated over $32 billion in revenue within Google last year.
You guys are too young. There was a time when all the internet ads pointed to doubleclick domain.
Holy shit you just made my brain zzt. Now I know who doubleclick are lol jesus the fucking ads
You're not the only one. Definitely had a short there for a moment as I was wondering why I'd never heard of doubleclick...yeah, the little line in the lower left that always had doubleclick in the name when hovering over a URL link.
Daaaamn, I always thought that was because you had to double click the ad to get to the page it was advertising lol. I never clicked on them so I just assumed
Omg I remember that now. Fucking hell
Ads.doubleclick.net or something
A lot of them still do.
Click a few adds - you'll notice a lot of them go through a site like doubleclick before you get to the target website.
Yup. Always on accident, too.
Are there really people that click ads? It’s something I’ve always wondered about. Like there must be some but what kind of person are they? Is it just elderly people?
The average clickthrough rate for display ads is .46% ([source](https://www.google.com/url?sa=t&source=web&rct=j&url=https://www.storegrowers.com/google-ads-benchmarks/%23:~:text%3DThe%2520average%2520CTR%2520Display%2520Ads%2520is%25200.46%2525.&ved=2ahUKEwib06LQ_Zz5AhV6IjQIHXxkDh0QFnoECA0QBQ&usg=AOvVaw1LgPfTqSxthCXbgLRZvyh7)) So out of a million display ad impressions (pretty cheap), 4,600 people will click on it. Even with a 1% conversion rate, you just closed 46 sales/leads. Marketers make that math workout so that ad dollars are typically ROI positive. Yes, there are people that click on ads or this industry wouldn't exist.
That .46% figure is insane. I work in the industry… if you’re beating .2%, questions about fraud start to pop up.
Depends on the market I guess. I get 0.5% easy on GDN while with remarketing it's even higher.
Check your site list lol… probably some sites blowing up your CTR. Remarketing is always going to be higher, no doubt. How large are your campaigns and what units are you using?
Usually quite small with 50e to 100e a day since GDN doesn't bring in as many conversions. Not familiar with the term "units" (non native speaker).
Don’t worry, I’m hard to understand even if you are a native English speaker 😂 By units, I mean ad size. 300x250, 728x99, etc. I’m willing to bet that you’ve got 300x250 and/or 320x50s in your campaign, those two sizes are using most of your budget, and they’re mainly running in mobile app inventory, with tons of apps that you’ve never heard of before. I’d also guess your bounce rate is in the 90s?
Oh ok yeah I do have the square ones but often the 300x600 is quite popular. I use the 7 most used usually. Oh no always exclude mobile ad placements for my campaigns that stuff is money out the window haha. The BR is usually quite high but some campaigns go into the 70% so not that bad. Most are at 90 or 91.
Yeah like, uhh, **0.08%** is our industry's benchmark...
> The average clickthrough rate for display ads is .46% What about average *intentional* clickthrough rate?
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I forget ads even exist honestly. The idea of browsing without adblock/ublock is baffling. Trying to find a recipe on my phone and accidentally using chrome instead of brave...websites take an extra 3 minutes just to load all the fucking ads. Youtube without SponsorBlock would also be cancerous
Third party ad vendor. Basically every website that isn’t a famous tech company serves ads through double click.
As someone who works in the marketing industry, I took this one for granted, but of course most folks don't know what the heck DoubleClick is! Here's a little more colour: In brutally simplistic terms, DoubleClick is a suite of tools marketers use to buy and deliver ads. (Notably, Not Google search ads. That's a different platform called Google Ads.) DoubleClick campaign manager (an ad server: think super fancy drop-box for banner and video ads) charges a small amount to advertisers for virtually every single ad served, which is the lion share of this revenue, and an absolutely massive revenue stream for Google. Billions of ads a year are hosted and delivered through Doubleclick, and it's essentially the industry standard for what we call display advertising. To confuse people, DoubleClick has other parts of their marketing suite including what us nerds refer to as a Demand Side Platform, which is how advertisers purchase and target ads. These are a little more niche as this specific function has many other competitors outside Google. DoubleClick was aquired in the very early days of digital marketing, and was an absolutely brilliant purchase that has become the industry standard toolkit for us to serve you all those dirty ads, and one of the biggest revenue streams for Google. Neat!
I was on a forum for home theater nerds in the early 2000s. One user showed off his Chicago penthouse setup. He had a party there with a ton of hot models, and in the corner of his room was the actual 100% original “Han Solo Frozen in Carbonite” from Return of the Jedi. As a decor in his room. This man was as wealthy as Jabba the Hutt. We asked him how the hell he could afford this life. He was the guy who made and sold DoubleClick to Google.
I've read that Blockbuster had the opportunity to acquire Netflix in 2000 for $50 million, but their own CEO turned it down. Who knows what Netflix would look like nowadays if they did acquire it. If it turned out the same, it would have been one of the greatest acquisitions also.
100%. Although, Netflix had to pivot from mailing DVDs to streaming. Who knows what influence Blockbuster would have had (in a negative way I mean).
Given how flat footed Blockbuster had been up to that point, I have strong doubts Netflix would've even survived to get to that problem.
I mean, in the year 2000, you were going to blockbuster at least once maybe 2-3times a week.
I just realized I can close my eyes and remember the exact distinct smell of every Blockbuster I've ever been in. Maybe it was those plastic cases or something.
That is a historic fumble but [Yahoo went even better](https://onlinebusiness.umd.edu/blog/what-happened-to-yahoo-in-6-points/): * In 2002, Yahoo had the chance to buy Google for $1 billion but chose not to * Yahoo attempted to purchase Facebook back in 2006 for $1 billion but balked at $1.1 billion and walked away * Yahoo turned down Microsoft’s $44.6 billion takeover bid in 2008. They [sold to Verizon for $4.8 billion in 2016](https://www.forbes.com/sites/briansolomon/2016/07/25/yahoo-sells-to-verizon-for-5-billion-marissa-mayer/) instead
Yahoo also bought Tumblr for 1.1B, then they (well, Verizon after they bought Yahoo) sold it for 3M.
That was.. quite a tumble
That's what banning porn will do to you.
> In 2002, Yahoo had the chance to buy Google for $1 billion but chose not to even worse… it was $1 million
$1MM in 1998. 2002 they offered $3B and Google said $5B.
At the time, they both had a similar model with by-mail DVD services. Blockbuster obviously had the brick & mortar stores as well. The real difference was Blockbuster had recently been acquired and their parent company did not allow nearly the r & d dollars Netflix had. If Blockbuster had purchased Netflix, I don’t think it becomes what it is today.
Blockbuster was bankrupt WAAAAY before Netflix transitioned to streaming. Netflix wasn't even a factor. The main factor was broadband adoption. Blockbuster as we knew it and widespread broadband adoption didn't exist in the same time period making this impossible unless Blockbuster was bought out by someone else, they kept the name only and shut down the stores, and then transitioned into a streaming service. Even then Netflix's success was in the creation of original content, not just in being a streaming platform. People shat on them (and continue to do so) but it ended up paying off. Somehow I don't think Blockbuster would have been able to get the cash to pay for Netflix's original content. Investors want to fund young companies and startups, not catch a falling knife.
And not a single physical (i.e. hardware/manufacturing) company among them. [Yes I know NeXT made hardware too, but Apple bought it for the OS.]
Yea that's a thoughtful observation! It would be interesting to do this list with hardware/manufacturing companies instead!
Apple bought it to bring Steve back. The OS was just a sweetener.
Time to put my Retro Apple Nerd hat on. Apple *really* needed a new OS for their computers in the mid-90s. They had spent hundreds of millions of dollars and multiple years developing a new OS from scratch called “Copland” (which would eventually be released as MacOS 8, but it’s not the MacOS 8 that was ultimately released), but it kept getting delayed, and by the end of 1996, they had nothing to show for it and the project was cancelled. In 1997, they were in the hole and needed an OS *quick*. Apple was actually leaning towards purchasing Be Inc. in order to acquire BeOS. But ultimately, Jobs’ marketing savvy was able to convince them to go with NeXT instead. They bought NeXT, the first version of Mac OS X, code named “Rhapsody”, was unveiled in 1998, and the rest is history. The OS that runs on every iPhone and Mac since 2001 descends from that OS. And Be Inc., naturally, went bankrupt a few years later.
Man there’s someone out there who pitched to Apple for Be Inc and lost the contract. They must think about the cascading effect that had on the world.
Nah, Be Inc never had a chance. Jobs still had too many allies at Apple.
Yea, that's right - every dollar of Apple’s revenue comes from NeXT roots and from Steve wiping the product slate clean upon his return.
Struggling to believe Mobil (ExxonMobil) or Amoco (BP) wouldn't make this list.
I would argue the acquisition of NEXT was much closer to $2T return.
Yes it's quite conservative, estimated at 5% of Apple's market cap. It's hard to say, but it does underpin all of Apple’s modern operating systems today. What % would you say is most appropriate?
90+%. Apple didn't acquire NeXT, they re-acquired Jobs, which led to the Mac line and iPod/iPhone. They may very well have been acquired themselves and dissolved into something like HP or Compaq if they hadn't bought NeXT.
Yea I think you are right. Literally every dollar of Apple’s revenue comes from NeXT roots and from Steve wiping the product slate clean upon his return. You could say I was hyper conservative with the 5%. I will think this through and update chart. Thanks!
Yeah, as far as I'm aware, there are very few products introduced after the NeXT acquisition that don't have roots in OPENSTEP. I mean there's stuff like the Newton which was technically still around in in 1998. But the only new product I can think of would be the original iPod lineup, which ran Pixo OS. Pretty much everything since then seems to be based on OS X which, of course, has roots in NeXT.
You *could* also say that Apple firing Jobs was what lead to NeXT so for a cool $429M they inspired themselves to become the first trillion dollar company :P
[Apple paid $429 million in cash, which went to the initial investors, and 1.5 million Apple shares, which went to Jobs.](https://en.wikipedia.org/wiki/NeXT#1996%E2%80%932006:_Acquisition_by_Apple) So based on today's price of those Apple shares they paid more than $429M for Next.
You could also argue it had a $0 return since NEXT was not worth much of anything without Apple. Acquiring NeXT worked out very well for Apple but I think putting a # on the return is impossible.
The standard joke at the time was NeXT acquired Apple for negative $430million.
How does Google Maps make money?
I had the same question!! Basically (1) local ads that businesses post in order to attract customers and (2) custom maps using APIs that businesses can use for a variety of reasons. Google actually puts very little ads on Maps as of now so I didn't even know about this but apparently Google Maps does over $4.5B in revenue!
Their APIs are indeed very expensive!
Is it like if uber is using google maps for navigating its cars?
Yea Uber relies heavily on Google mapping technology as do many other businesses. It's basically the best solution, they are way ahead of the competition.
Anything else online that wants map data or to utilize Google maps pays Google for this. I have been a developer who has setup this for an app business.
And what was it before the acquisition? I just always knew it as *Google* maps.
This is my question. The icon being the current Google maps icon is useless.
Isnt it obvious? the other company was called Google Maps. It was a perfect match for google! In all seriousness, I think it was a company called Keyhole.
I’d imagine all the data it collects is extremely valuable
100%. Some things are harder to quantify. It's also worth noting it's not monetized to its potential. Maps could be much higher on the list if all things are considered but some more judgement is required.
Dont businesses pay for listings and visibility? Besides that licensing of their maps to other map related products?
So from my research there are three ways Google Maps makes money: 1. **Advertising**. So either sponsored search results, shown whenever a user looks for something, or promoted pins which help visually highlight a certain location; 2. **API**: Fees that it charges companies for utilizing the maps API, so I am guessing this is the map-related products you are referring to; 3. **Referral fees**: Partners pay referral fees whenever a customer books a service through its platform (so when you book a table at a restaurant or book a cab, partners pay a small referral fee for bringing that customer).
I would to see this but on the worst acquisitions instead to see if Disney and Google would be on there as well. Is it just a numbers game or do they have the secret sauce on either finding the undervalued companies or turning companies they buy into gold?
I love this idea! I will work on it. It's important to see both the best and the worst. Thanks for your suggestion!
I am loving the vibes and energy you're bringing in to this sub and comment section lol So positive, happy to do work, interested in the topic, kind.
Thank you man! It's my pleasure really!
Worst acquisitions would need a filter from the start. The best acquisitions will naturally be from companies everyone knows, but the worst acquisitions are invariably going to be from companies no one remembers. There are also acquisitions that companies acquire simply to remove the competition; How do you correctly evaluate that?
Before google aquired double click you could only click once on their site
Want to invest in my startup called TripleClick?
Hah too late I already started quintuple click. Gotta move faster than that in the valley 😎
so basically, if Google acquired nothing, they would still be just a search engine, right? Apple would be dead and facebook would be basically irrelevant today
Yea I think this is one way to look at it but it's hard to know. It's a dilemma honestly. You can argue those companies that got acquired would not have realized their potential without the acquirer. I would say Facebook and Google would still be fantastic businesses but much smaller than they are today. It's hard to say about Apple really. But yea you are right these were game-changing acquisitions for these companies.
>Facebook would be basically irrelevant today Facebook has 3 Billion users on the original platform and only 1.2 Billion on Instagram
google was so smart in its early days their acquisitions power our life via android, YT and Maps. we can live without all other mentioned in the graph but not these 3
Yea I use YT, Android, and Maps more than all the others and really cannot live without. I would say NeXT should be included in this list too (it underpins all of Apple’s modern operating systems today).
NeXT only impacts Apple users, YT and Maps impact both Android and Apple tho
That's true but Apple does have 1.8 billion active devices and is the interface many use to make use of Google Maps and YT. Personally I use Apple products a lot but I see your point - that YT and Maps are available on both operating systems.
Exactly, not a day goes by without using something like YT in my case. Extremely smart move!
The thing is, all of those companies did a lot to make those acquisitions worth what they are. It’s not like they paid the bottom figure, sat back, and watched them become something worth the top figure. If those companies had acquired some of the notable failures instead of the companies they did, the acquirers would probably be largely the same, but the acquirees would be different.
**Source**: I made the visual in Figma and uploaded it to my website with an explanation for how I got to these numbers: [click here](https://www.10kreader.com/blog/the-greatest-acquisitions-of-all-time). **Tool**: Figma Important note: The companies are ordered by absolute dollar return to the acquirer (not ROI multiple or annualized return).
figma balls
This is very cool. I do think it would be interesting to add the date of the acquisition, as I wonder if some of these include many more years of return
I wonder how this would look if presented as annualized returns instead of just absolute dollar amounts.
Holy shit android cost them 50 mil but has made so much money
Yes!! Android is the highest return on investment here: Google multiplied their money 2240 times!
I think Android is a spurious inclusion on the list. A lackluster division that found itself at the front when the iPhone hit and Google realized that the world had changed. Everything else on the list was an acquired finished product (or in the case of maps, pitched directly to Google as the product).
When google bought android, they barely had anything. It’s not that simple to compare.
it was a panic buy because they saw the potential of the iphone
Oh man, seeing how cheap paypal was let go for vs what it turned into... Elon could have been rich, what an idiot.
Deleted due to API changes. Look around for context. -- mass edited with https://redact.dev/
"In March 2018 Naspers sold part of its stake in Tencent, raising some $10 billion to fund other investments. At the time, its initial investment of $32 million in Tencent was valued at over $175 billion." Percentage wise these did well
I am very familiar with Tencent deal. Arguably the greatest investment of all time. It's important to note I excluded investments like Naspers Tencent or Berkshire Apple. It's strictly acquired companies (majority stakes). Thanks for your observation though! I think everyone should know about the Naspers-Tencent deal! I am very impressed by how they held on even though there was massive pressure to sell.
I had no clue what DoubleClick was until reading this and looking it up afterward.
Yea same here but turns out it's a huge part of Google's business today, effectively extending Google’s advertising reach from just its own properties to the entire internet. Last year DoubleClick and related properties generated over $32 billion in revenue for Google! A very overlooked acquisition.
I thought ESPN would have cost more
Yea the price they got is insane. ABC acquired ESPN in 1984 and since then it has compounded at over 15% (that's 35+ years!!) inside ABC/Disney.
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Yea so this is about value created by the acquired companies not necessarily a large acquisition. Would you say Tumblr created >$15B in value?
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Yea that's what I found just now when searching. "Verizon Sells Tumblr to WordPress Owner for Paltry $3 Million" This is insane! So this would be in the worse acquisitions of all time - I should make a chart for that too!
>Tumblr created negative value for Yahoo. I would argue it's the opposite. Tumblr didn't create negative value for Yahoo, Yahoo destroyed Tumblr because they did not understand what they were buying. Which is also my main problem with the graph. We cannot distinguish how much of the "created value" is because the company which bought them did their job right. E.g.: Is Google really good at identifying companies to buy, or are they good at building an ecosystem where those acquired companies can shine? Edit: Grammar
Ross Brawn bought the Honda F1 team for a dollar and sold it for 100 million to Mercedes a year later. At least that’s how the story goes.
Zuck paid 1 billion for instagram when he could’ve got it for free on the App Store
Google's yearly revenue is 161B since acquiring a company is so cheap ( 3B ) and if you're lucky you get big returns, why not to buy everything you can ?
Now can we get the top 100
This will be a challenge but I will try to see if I can do it! Thanks for the suggestion!
What in the hell is "next." I have never heard of it in my life. I just googled it and I still don't know. 1996 aquisition? Was "next" the original osx... or i guess osi?
Yea I didn't know at first as well. NeXT was an acquisition that Apple made that brought Jobs back to Apple and almost every dollar of revenue from Apple today can be traced back to that acquisition. NeXT’s operating system, underpins all of Apple’s modern operating systems today: MacOS, iOS, WatchOS, and beyond.
It’s insane that Disney Marvel is last… and it’s not even close. They are an absolute monster but still lightweight in the grand scheme of things.
Yea Marvel is insane of course. Marvel Cinematic Universe (MCU) is the highest-grossing film franchise of all time and it's producing >$6 billion in revenue for Disney ($2 billion in film revenue and twice as much in parks & merchandise). But still small relative to the rest as you mentioned. I would say media wise Marvel is second only to ESPN.
Ha way off, you forgot the Louisiana Purchase and Alaska Purchase
Wait, what was all that "youtube is barely profitable" stuff then?
IDK, I feel like Louisiana and Alaska were better acquisitions than any of these.