Mark, I know for a fact that my experience was not an isolated incident. Several other startup founders & Facebook employees have told me that what I experienced was part of a systematic M&A “formula”. 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. I know all about intimidation-based negotiation tactics: I experienced them for years while dealing with the music industry. Bad-faith negotiations are inexcusable, and I didn’t want to believe your company would stoop this low. My mistake.
In a lot of ways, I got what I deserved. I have come to the conclusion that I took this foolhardy risk because the Twitter “platform” was even more of a joke than the Facebook “platform”. As someone that wants to build quality social software, software that doesn’t force users to re-create their friends list, or not use oAuth, etc., I have to endure huge platform risk. Personally speaking, I am resolved to never write another line of code for rotten-to-the-core “platforms” like Facebook or Twitter. Lesson learned.
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Rafer sez:
@daltonc I’m concerned you’re learning the wrong lesson here, and in doing so lost the direct involvement of a guy like Andreessen.
It’s incumbent on you (and certainly also me) to make sure that we’re starting businesses in segments that actually require a new entrant and can not be filled by a product line extension from an incumbent. Whether or not they fill holes as early as Twitter, large companies with developer programs all consolidate their segments — and do so a economically as possible. That means every third-party developer grows up, sells cheap, or dies.
Playing naive to that reality went out the window in the mid-1980s with PC software and has been reproven by the platforms at least every 24 months since.
The lesson instead is: build something whose very nature makes it a cannibalistic cash flow hit for a BigCo so that their shareholders resist competing, but which their users love.
It feels trite to point to Instagram, but it’s a pretty good example here. In theory, either Apple or Facebook could have built that app instead. For whatever reason, Apple’s strengths seem to systematically keep them out of social. That’s great for a lot of companies big and small. More critically, Instagram’s mobile traffic is lousy for Facebook’s income statement. I’m willing to theorize that Facebook didn’t want to make a social camera work before they figured out mobile monetization. And Instagram grew up before that happened, making its acquisition by someone other than Facebook a bigger threat than the near-term financial hit. It’s no accident that Instagram is getting big-screen friendlier now that Facebook is influencing their product direction.
At Lumatic, we believe that we’re building Maps that screw up the incumbents’ models. We’re using all sorts of bigco third-party APIs and social distribution. If we’re not compelling to them as a developer, that’s no one’s fault but our own.
(via rafer)
»I’d go further to say that buy vs. build conversations happen all the time, and it’s kind of honest and direct to have them openly. The only thing that rankles me in Dalton’s post is the implication that there was platform leadership support for their developing in this area. It’s incumbent on a platform that wants to keep the good faith of its developers to warn them away from the soon-to-be-filled holes if it reasonably can.
(via rafer)
