Chart: Google's appetite for acquisitions continues to grow |
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It seems that nearly every other week Google is in the news with another acquisition announcement. The search giant has gobbled up 23 companies so far this year, making it the biggest tech acquirer by far, according to an analysis from CB Insights. By comparison, Google's chief rival, Microsoft, has announced zero deals so far this year, according to the report. [Posted updated below with clarification on Microsoft's M&A deals.]
Interestingly, the merger and acquisition chiefs from Google, Microsoft, Facebook, Amazon.com and Cisco discussed the state of the M&A market at the WTIA TechNW forum in Seattle on Monday. Amin Zoufonoun, director of corporate development at Google, indicated that the search titan's acquisition pace won't slow down too much in the future.
"...Things are evolving so rapidly, that for us to be able innovate outside of our core DNA as rapidly as entrepreneurs in this audience is probably a losing battle. So, we will probably continue to acquire," he said.
That might be good news for venture-backed startups. The vast majority of companies purchased by Google were backed by venture capitalists or angel investors, according to the report. (One exception was Seattle online photo editing service Picnik, which was backed by the company founders and sold to Google earlier this year for around $50 million).
The lack of M&A deals by Microsoft has been somewhat perplexing to me. And it also has caught the eyes of the data hounds at CB Insights, who ask in a blog post whether Microsoft is just focused on organic growth or if something bigger might be in the works.
Marc Brown, managing director of corporate development at Microsoft, didn't disclose many secrets at the TechNW forum on Monday. But he did offer one comment which left me scratching my head about Microsoft's current acquisition tally. Here's what he said:
"Over the past 12 months, Microsoft has been very focused on smaller acquisitions, feature functionality that we can add to our current product set. We've done roughly 15 acquisitions over that period of time. The purchase prices have been in the up to $75 million range, and typically it will be 20 to 30 people who haven't yet begun to add the marketing muscle and haven't started to look internationally in terms of distribution and we find great people and great technology in that set of companies."
I am not sure if Brown misspoke when he mentioned the 15 acquisitions or whether the software giant has simply engaged in a number of smaller, unannounced deals in the past 12 months. I'll try to get some clarification, and I'll update when I hear more.
But there's no question that the new chief acquirer in tech land is Google.
UPDATE: Microsoft's Brown said that Microsoft has completed about 15 M&A deals this year, though a number of them were very small and therefore were not announced. [CB Insights only tracked announced deals). He also indicated that the company has entered into a few deals that are signed, but have yet to be announced. Anyone have any ideas on where Microsoft might be sniffing around?
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