My experience with mergers and acquisitions is that it's akin to keeping a warm body on life support. When I worked at a company that did a lot of M&A I was sitting around like, "Why couldn't you have just built that?" When I worked at a company that was recently acquired and went through the merger process I was like, "wow I see why you bozos would've never built this yourselves." That isn't to say there aren't companies that do them well or there aren't places where it makes sense in an ultra-competitive landscape but I'm curious - when was the last time anyone really considered tech an ultra competitive landscape?
Post-2015 other than large language models this industry has mostly been riding on intellectual property consolidation. That's basically Lina's point; nobody actually benefits from this - not customers, not share holders, not the American people. The over practice of M&A leaves a small pool of winners who are not the kind of people that post on or read this forum.
The only ones that benefit are the executives from temporary boosts of revenue numbers hitting targets for their bonus payouts.
>nobody actually benefits from this
The secondary market drives the primary market.
If you mean the ones transacting in derivatives, no, they don't. The US market isn't India where the size of the secondary market was bigger than the primary market. If you mean that financial markets drive real markets, that's also wrong. While yes, certain products need a infusion of cash to get to market, that's not the same as having a company acquire the possibility of a new product and just sit on it.
You could just look up what primary and secondary markets meant without speculating and chiming in with irrelevant takes.
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Buying a company for its customer base is rarely good for the customers, though. That's the main point, I think. Why should society allow someone to take control productive entity simply so they can extract more value from it? There needs to be some value for the customer or the public as a whole for that to be a good thing.
If I build a company I should be able to sell it to whoever I want for any reason. It’s my company
A "company" is a legal framework that we, society, has decided is allowed to exist. That also means that we are allowed to put any requirements and restrictions on it that we like. The health of our society is what matters, not the wealth of any particular founder.
Yes and in our democracy I can advocate for stronger property rights including over ownership of companies
Yes, but a lot of society will advocate against that.
"your company" is an abstract idea in a social framework forming the interactions of many other people. Many decisions are delegated to you by that framework, but it is not a fundamental absolute.
I accept we live in a society which decides at some arbitrary point that my property becomes the collective’s. However I philosophically disagree with this present state of affairs
Ownership is a useful framework for sure, but if it comes at the expense of destroying competition, I think we can agree that's not healthy for the economy and society as a whole.
I disagree with the concept of “monopoly” or rent seeking in a free market. And the only way a market becomes non-free is with government regulation
The world has never, ever seen a free market, and probably never will.
The idea that completely unencumbered markets would actually give good outcomes for society is a complete fantasy.
It appears to me that wherever we allow market forces to exist we get better results
If companies get large enough, you no longer have a free market. You simply have a company so dominate and powerful, they can undercut any new company or product. Not on merit or offering a better product. Purely based on size and its entrenched position.
Let's say company A is monopolizing a market. New company B finds a way to make company A's product providing exactly the same value, except half as expensive. A healthy market would reward company B and consumers both by allowing that innovation to spread, providing a return for those that invented it and a cheaper product for consumers, leading to greater prosperity for society. However, in the market you speak of, company A can simply use their orders of magnitude more wealth to undercut company B for a time until they go bust.
What incentive is there to innovate, to improve, in a market that doesn't reward it?
Not for no reason at all, just not economical or innovative or supporting the customers.
It is all a dog and pony show now to chase the investors while centralize and concentrate wealthy in the hands of very few.
Edit: do think we ought to promote using Penpot type of alternative to proprietary counter part.
M&A deals are analyzed pretty closely and there (usually) has to be a convincing argument that it is economically or strategically accretive to the acquirer. It's easy to call them all morons from afar, but I think it just highlights how difficult it is to pull off successfully. And when it is successful, it's always an obvious no-brainer in retrospect.
Anecdotally, I know someone that spent two years intentionally sabotaging an M&A deal that would replace his internal product and team in a company. He and his colleagues were successful and everyone thinks the acquirer was a dumbass for doing it, but with more knowledge about the misaligned incentives it starts to become more clear.
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In context, Lina Khan didn't have authority to regulate non-American entities.