He used different tactics, from "soft" to "hard" so that the acquisition of companies took place quickly.
In the weeks prior to Mark Zuckerberg's decision to buy Oculus for $ 2 billion, he received a message from Oculus's CEO, Brendan Iribe, saying that Google was also seeking to buy back Oculus. you.
The same thing happened with the acquisition of WhatsApp in 2014 for $ 19 billion. Two weeks after the deal was finalized, Google also offered to buy WhatsApp at an attractive price to grab the messaging app from Facebook.
However, Facebook has successfully captured both Oculus and WhatsApp, causing Google to miss this precious opportunity twice.
Zuckerberg shared his acquisition strategy at a Dallas court on Tuesday. He came to report that Oculus had been sued by Zenimax because they thought Oculus had infringed intellectual property rights.
Here are the four strategies Mark Zuckerberg used:
1. Build relationships
Although Facebook only took over Oculus within a week, Zuckerberg said he often approached big companies by building friendships with their founders or owners. "Relationship building is happening with all three Instagram, WhatsApp and Oculus companies." Says Zuckerberg.
"I have built relationships for many years with the founders / stakeholders, at least in the case of Instagram and WhatsApp. This is a very important point in many acquisitions. I think we were no longer rivals, but we became like-minded people and this is a very valuable thing. Another one is hard to get, "he explained.
2. Have a general look
Zuckerberg said that the reason he could buy Oculus for under $ 4 billion (Oculus wanted a higher price like this) is because he shared his vision of Facebook's future and it coincides with what Oculus is coming.
"The most important thing is that the views on the future must match, and both companies must be excited about the future of working together, or they will build the hardware and we will develop the experience. Is it better than working alone? ", says Zuckerberg." If the acquisition of the company happens, it's not because we bought it at a high price, The price we give is unmistakable. That's because we let them know they will grow if they work with us. "
3. Use "bullying"
Although Zuckerberg used the tactic of acquiring the company in a very peaceful way, he said that sometimes a little "scrambling" would get small companies to accept the acquisition. "I do not usually use it, but sometimes I have to explain to the company that they want to buy back the hardships they will face without cooperating with us," he said.
Evan Spiegel, CEO / co-founder of Snapchat.
Evan Spiegel, CEO / co-founder of Snapchat.
It is not clear whether Zuckerberg used this method with Evan Spiegel. Spiegel declined to offer a $ 3 billion acquisition of Snapchat from Facebook a few years ago.
4. Act fast
When Zuckerberg was advised by advisers that the acquisition of Oculus too quickly would bring risks, Zuckerberg, however, said it was a quick move to sign the deal. "When you are in a position to buy a company and it has the potential, you do not have much time to make a decision," Zuckerberg said.
This is also the motto of Facebook: "Move fast and break things." It has caused Facebook to beat many of its competitors by acquiring other companies. Zuckerberg says more about this tactic:
"In big deals with billions of dollars, like Instagram or WhatsApp, we have to act fast because other big companies want to be on the same page." At the same time, Facebook At some price, the competitor also offers a higher price. So we have to move quickly to sign up for the acquisition and at the same time save money as long as they have the opportunity. A higher price, other companies often take a couple of weeks to make important decisions, but a big advantage on Facebook is that we can flexibly and make quick decisions if needed. Helpful to the development of Facebook "
Refer to Business Insider
