Earlier today, Facebook acquired NextStop, a social travel recommendation service. There’s been some speculation as to why this deal went down. Is Facebook getting into the travel space? Is this about their unlaunched location offering? From what we’re hearing, it’s much more simple than that. It really just boils down to Facebook getting a few very talented people at a relatively low price.
Facebook has been on a mission to scoop up as many smart management types as possible, we’ve heard from a few sources recently — some of whom have talked directly to Facebook. That may seem obvious — after all, who wouldn’t want the best talent? But Facebook is in the unique position now to have resources to simply acquire companies in order to get these people. And that’s exactly what they’re doing, we’re told. → Read More
It’s become a common trope to say that Facebook and Google are vying to become the operating system of the Internet. But there are some very clear hints of that in Facebook’s upcoming new design, which it just opened up to today in a developer sandbox. (You can see it at http://www.new.facebook.com, although you’ll need to download some libraries to start testing apps with it). It appears that Facebook is moving closer to becoming a Webtop application, fusing elements of the desktop into the Web experience. Eagle-eyed TechCrunch reader Ryan Merket (above) noticed something vaguely familiar about the new design. See the menu bar above his profile? Look closely. Its got some handy menus on the left that take him to his profile, his friends, applications, and inbox. And on the right of the menu bar is a search box. That is the same visual metaphor you find in the menu bar on desktop operating systems. The menu choices are different than on you desktop, because these tap into Web applications and resources. But the navigation is the same. Menus on the left. Search on the right. And don’t forget the chat bar on the very bottom that, like a status bar, shows you how many of your friends are online and lets you chat with them. Could this be the work of Facebook’s Parakey acquisition from last July finally bearing fruit? Parakey was the pre-launch startup from Firefox co-founders Blake Ross and Joe Hewitt that was working on a “web operating system.” Facebook was rumored to have beaten Google on the deal. Facebook is already well on its way to becoming an operating system of sorts for the Web. (This time around there will be room for more than one OS). It is the application platform of choice for many Web developers. (Tomorrow, it turns one year old). But why reinvent the wheel on the user interface side when everybody is already trained how to use a menu bar? The aha moment will be when people click on those menus and a whole new world opens up to them. CrunchBase Information Facebook Parakey Information provided by CrunchBase → Read More
When Facebook acquired Parakey in July, everyone assumed the stockholders of that fledgling startup would be popping the champagne bottles. No matter what the acquisition price (it wasn’t disclosed), if the sellers got Facebook stock in return for their Parakey shares, it would likely be worth a fortune down the road. It turns out that wasn’t the case. The acquisition price, say two sources close to the deal, was paid in cash and was “less than $4 million,” providing investors with just a 2x return on their investment. Meanwhile, Parakey founders Blake Ross and Joe Hewitt were rewarded handsome stock options to join Facebook as employees in lieu of any cash compensation. The primary investor in Parakey was Sequoia Capital, but a number of angel investors also participated in the sub-$2 million round that closed in December 2006. The investors were told about the acquisition in mid 2007 just prior to it closing. The terms of the deal were fully disclosed to them, including the number of shares that were being granted to Ross and Hewitt. Some of those investors clearly weren’t happy with the fact that they were getting a 2x cash return while the founders received different, and likely far more lucrative compensation. Their preference would have been to receive Facebook shares or simply to have kept Parakey as an independent entity with a chance for a larger liquidity event down the road. But reputation matters in silicon valley and they made the decision not to disrupt the deal to avoid being labeled as difficult investors. Clearly, though, it left a bad taste in their mouth. Even as investors are lining up to fund new Facebook applications, some others are saying they’re unlikely to invest in startups that are focused only on that popular social network/platform. The fact that Facebook is now involved in directly funding some of these application developers via fbFund only makes them more wary – the company may simply pick off the most talented developers and leave the companies, and any investors, behind. It is often hard to muster up much sympathy for the venture capitalists that fund all of the startups popping up in silicon valley and elsewhere. But their money keeps the system running smoothly. If they don’t see a fair return based on the risk they are bearing (most startups fail outright and are a write off), that well oiled machine → Read More
Their first acquisition: Facebook has bought Parakey, the yet-to-launch “web operating system” created by Firefox co-founders Blake Ross and Joe Hewitt. The price isn’t being disclosed, but Facebook should be issuing a press release this afternoon. Parakey was founded in 2005 and raised a seed round of financing from Sequoia Capital (although this was never confirmed). There is a good background story on Parakey, which will include both browser and client software, here. As he describes it, from a user’s point of view, Parakey is “a Web operating system that can do everything an OS can do.” Translation: it makes it really easy to store your stuff and share it with the world. Most or all of Parakey will be open source, under a license similar to Firefox’s…Parakey is intended to be a platform for tools that can manipulate just about anything on your hard drive—e-mail, photos, videos, recipes, calendars. In fact, it looks like a fairly ordinary Web site, which you can edit. You can go online, click through your files and view the contents, even tweak them. You can also check off the stuff you want the rest of the world to be able to see. Others can do so by visiting your Parakey site, just as they would surf anywhere else on the Web. Best of all, the part of Parakey that’s online communicates with the part of Parakey running on your home computer, synchronizing the contents of your Parakey pages with their latest versions on your computer. That means you can do the work of updating your site off-line, too. Update: Was Google a bidder for Parakey? One source says they were, but couldn’t compete with Facebooks pre-IPO stock. Facebook isn’t saying if this was a stock or cash deal, but it wouldn’t be dumb to assume that Facebook stock was at least part of the acquisition price. In an IPO the value of that stock would probably increase dramatically, giving the Parakey stockholders a nice additional return on investment. → Read More
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