Think acquihires are limited to relatively small deals for relatively small, young companies? Think again.
Google, which is aggressively investing in Google+ despite widespread skepticism over its prospects, yesterday confirmed the rumors that it is acquiring toolbar and ad service Meebo.
Meebo, which began its life in 2005 as a web chat service and was at one point considered a star in the social media space, had previously raised some $70m in venture capital funding. But despite the company’s ability to reinvent itself every so often, Meebo’s investors apparently believed that selling to Google for a reported $100m was the best option available.
So what does Google want with Meebo? According to TechCrunch’s Eric Eldon, Meebo is basically an acquihire to bolster the Google+ team. “We’ve learned that the product team will be using its expertise to help build out publisher tools for Google+. We don’t know if this means there’ll be some sort of new Google+ toolbar coming. But, presumably the existing Meebo properties will be morphed into G+ or otherwise closed,” he writes.
Eldon’s sources say that employees in Meebo’s sales and marketing departments have been laid off, which wouldn’t be surprising if the acquisition is indeed intended to bring new blood into the fold of the Google+ product development team.
The big question, of course, is whether such a big acquihire can really help Google+. Recently, Google completed a much smaller acquihire with the same intent. But the search giant’s purchase of Kevin Rose’s app incubator Milk doesn’t appear to have produced the desired outcome, with Rose joining Google’s venture arm, Google Ventures. While all of the details obviously aren’t public, the move to make Rose a partner at Google’s VC firm all but ensures that Rose isn’t going to be the social-savvy product guy who will save Google+.
For Google’s acquisition of Meebo to be worth the $100m the company is paying, key members of the Meebo team, which includes founders Seth Sternberg and Sandy Jen, can’t pull a Kevin Rose. They will need to stick around, and even then, there’s no guarantee that it will be enough.