Facebook To Make About 15 Talent Acquisitions in 2011
Next year, look for Facebook to make plenty of small acquisitions to beef up its engineering expertise, like it did with Hot Potato and Drop.io this fall. — That was the message from Michael Brown, corporate development manager at Facebook …
Context & Ripple Effects
Facebook closed out 2010 with two small team purchases — Hot Potato and Drop.io — both framed internally as engineering additions rather than product buys. Corporate development manager Michael Brown has now put a number on the strategy: roughly 15 similar deals in 2011. The approach was already visible in November, when Facebook bought start-up assets specifically to staff its mail overhaul.
Individually these deals are too small to move markets; taken as a stated annual program, they make talent acquisition a primary hiring channel for a company entering an aggressive scaling phase, and they give very early-stage founders a repeatable exit route that does not require building an independent business.
First-order effects
- Sub-scale startups with strong engineering teams become direct targets: Facebook's corporate development group, per Michael Brown, intends to absorb around 15 of them during 2011.
- Acquired teams feed product work immediately rather than running standalone, the pattern set by Hot Potato, Drop.io, and the assets folded into the mail project.
Second-order effects
- Rival acquirers competing for the same scarce early-stage engineers now face a buyer willing to run fifteen deals in a single year, tightening the market for small technical teams.
- For founders and their backers, being built to be acqui-hired becomes a rational endpoint alongside traditional venture paths, since Facebook has signaled it will pay for teams whose products may never ship independently.
Third-order effects
- Talent acquisitions harden into a recognized M&A category — fast, small, product-dissolving deals that sit below the deal sizes where antitrust scrutiny concentrates on market share.
- If the cadence holds across the industry, headcount growth at large consumer platforms increasingly comes through absorbed startup teams rather than organic recruiting alone, reshaping how early-stage companies are valued.
The trend: Acqui-hiring is consolidating from opportunistic deals into a standing corporate-development function at large consumer internet companies, turning startup teams into a routine hiring pipeline.