The Vanishing Collaboration Start-ups

What I am seeing is a number of small (4-8 people) collaboration start-ups that have been gobbled up by larger organizations within 18 months of their start. The first one of these I had personal experience (as a minor stock holder) with was Kibits, who changed their name to when they bought the domain from me a year ago. Within 6 months they had been discovered, vetted, and bought by Cisco.

I saw the same thing happen again with Assemblage. Cathrine and Christian from Stockholm were making collaboration tools totally based on WebRTC and a year ago their initial tool was called Cathrine came to SF about 6 months after they started as CEO and CMO, and Christian was doing most of the development. Their tool was free, and so many people tried it. Catherine went through a 6 month incubator process, and I got invited to the incubator graduation where each of the companies got to do a 6 minute presentation. By that time they had broken their tool up into 3, based on functions:, and They got $1M in funding 3 days after the demo (which has to be some kind of record). Then last week I got an e-mail saying they had been purchased by Cisco, and the Assemblage sites were closing down. Unfortunately, I did not have stock in this one.


This got me to thinking, how many other collaboration start-ups have been snapped up by larger companies in the last year. So I did some research and found there had been quite a few:

  • WorkVoices acquired by Viadesk
  • PGI acquired Powwownow
  • PGI acquired ACT conferencing
  • (November 2012) Jive acquired New York-based social task management company Producteev
  • Jive acquired and San Francisco-based, a real-time communications platform
  • Jive acquired Offisync ($27M)
  • Rally software acquires Flowdock
  • ViewPoint acquires 4Projects
  • Telligent acquires Zimbra (from VMware)
  • Autodesk acquires Qontext
  • Citrix acquired Podio
  • Citrix acquired Netviewer
  • Citrix acquired RingCube ($33M)
  • Google acquired QuickOffice
  • Google acquired Docverse

I am sure there are many more that I missed, but I think this is enough data points to show a trend.

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This same kind of thing happened in 2007-2008, but at that time it was document management and project management companies that were being pressed by their user base for collaboration features. This time it is cloud-based solutions that need collaboration features, so it is no big surprise that many of these start-ups are being snapped up again.

Most of these acquired start-ups had these characteristics:

  • They already had a good number of users
  • They were already through a seed round, and sometimes an A round of funding
  • They were 4-20 people (in general)
  • Some were co-located, some were distributed
  • They all had great teams with lots of talent and creativity
  • Often they had identified a need or trend before the larger companies had, and so had a head start, making the big companies think that it is easier to buy than build.
  • Their technology had to be compatible with the big companies in some way.
  • They were part of the big companies new collaboration strategy

I expect this trend of acquiring early stage collaboration start-ups to still be quite active in 2014 and 2015, as there are many pieces to the collaboration puzzle, and no one vendor has solved this puzzle yet!