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Acqui-hiring is a process primarily focused on obtaining a company's products or services, with human capital being a secondary consideration.
Answer: False
Explanation: Acqui-hiring is defined as the acquisition of companies primarily for their human capital, with products or services being secondary.
The term 'acqui-hire' was coined in 2010, coinciding with the phenomenon gaining widespread media attention.
Answer: False
Explanation: The term 'acqui-hire' was coined in 2005, though the phenomenon gained widespread media attention in the 2010s.
Acqui-hires are generally larger in scale and slower to execute than other mergers and acquisitions.
Answer: False
Explanation: Acqui-hires are typically smaller in scale and faster to execute compared to other mergers and acquisitions.
Discussions about software companies merging to acquire developers first appeared in the press in the early 2000s.
Answer: False
Explanation: Discussions in the press about software companies merging to acquire developers date back as early as 1985.
The phrase 'acqui-hire' was traced by Ben Zimmer to a scholarly journal article published in 2005.
Answer: False
Explanation: Ben Zimmer traced the derivation of the phrase 'acqui-hire' to a blog post published in May 2005, not a scholarly journal article.
The image caption 'Acqui-hiring between 2009 and 2013' refers to a visual representation of the trend or activity of acqui-hiring during that specific four-year period.
Answer: True
Explanation: The image caption 'Acqui-hiring between 2009 and 2013' directly refers to a visual representation of the trend or activity of acqui-hiring during that specific four-year period, as stated in the source material.
By 2014, acqui-hiring was a well-established subject of published academic research.
Answer: False
Explanation: By 2014, despite widespread media discussion, acqui-hiring was not yet a subject of published academic research.
What is the primary focus of acqui-hiring?
Answer: Obtaining human capital, meaning their talented employees.
Explanation: Acqui-hiring is defined as the process of acquiring startups primarily for the purpose of obtaining their human capital, meaning their talented employees.
When was the term 'acqui-hire' first coined?
Answer: 2005
Explanation: Ben Zimmer traced the derivation of the phrase 'acqui-hire' to a blog post published in May 2005.
Which characteristic typically describes acqui-hires compared to other mergers and acquisitions?
Answer: Smaller in scale and faster to execute.
Explanation: Acqui-hires are typically smaller in scale and faster to execute compared to other mergers and acquisitions, often involving startups without revenue.
Discussions in the press about software companies merging to acquire developers date back to what year?
Answer: 1985
Explanation: Discussions in the press about software companies merging to acquire developers date back as early as 1985.
Who traced the derivation of the phrase 'acqui-hire' to a blog post published in May 2005?
Answer: Ben Zimmer
Explanation: Ben Zimmer traced the derivation of the phrase 'acqui-hire' to a blog post published in May 2005.
What does the image caption 'Acqui-hiring between 2009 and 2013' refer to in the source material?
Answer: A visual representation of the trend or activity of acqui-hiring during that specific four-year period.
Explanation: The image caption 'Acqui-hiring between 2009 and 2013' refers to a visual representation of the trend or activity of acqui-hiring during that specific four-year period.
What was the status of academic research on acqui-hiring by 2014?
Answer: It was not yet a subject of published academic research.
Explanation: By 2014, despite widespread media discussion, acqui-hiring was not yet a subject of published academic research.
The primary objective of acqui-hiring is to integrate a group of individuals who are new to working together into the acquiring organization.
Answer: False
Explanation: The primary objective of acqui-hiring is to acquire a cohesive group of people who are already productive when working together, not individuals new to collaboration.
Compared to traditional employee poaching, acqui-hiring typically offers fewer tax advantages due to the larger capital expenditure.
Answer: False
Explanation: Acqui-hiring may offer more tax advantages compared to traditional employee poaching, depending on the jurisdiction and acquisition structure.
Acqui-hiring is most appealing when a particular industry has an abundance of easily accessible talent through conventional hiring methods.
Answer: False
Explanation: Acqui-hiring is most appealing when talent is scarce within a particular industry, making conventional hiring challenging.
Access to talented employees is considered a key factor in competitive advantage because human capital directly contributes to innovation, productivity, and overall business success.
Answer: True
Explanation: Access to talented employees is considered a key factor in competitive advantage because human capital, with its skills and expertise, directly contributes to innovation, productivity, and overall business success.
Acqui-hiring scales recruitment efforts by focusing on individual, highly specialized hires one at a time.
Answer: False
Explanation: Acqui-hiring scales recruitment efforts by allowing for the simultaneous hiring of multiple employees, rather than focusing on individual hires.
Expertise gained from acqui-hiring can help the acquiring company pivot to a new market sector and decrease innovation within established firms.
Answer: False
Explanation: Expertise gained from acqui-hiring can help the acquiring company pivot to a new market sector and *increase* innovation within established firms.
Entrepreneurs might accept an acqui-hire offer primarily to maintain full control of their struggling company's product line.
Answer: False
Explanation: Entrepreneurs may accept an acqui-hire due to burnout or as a more successful outcome than liquidation, and the acquired product is often discontinued, indicating a loss of control over the product line.
Acqui-hires exclusively focus on human capital and never involve the acquisition of intellectual property.
Answer: False
Explanation: Beyond human capital, companies often acquire intellectual property such as patents, software, datasets, or trade secrets during an acqui-hire.
Acqui-hiring is solely motivated by talent acquisition and never by the desire to eliminate competition.
Answer: False
Explanation: Part of the motivation for acqui-hiring may be to remove potential competitors from the market, in addition to talent acquisition.
There is no potential tax advantage to acqui-hiring over simply poaching individual employees.
Answer: False
Explanation: Depending on the specific jurisdiction, there may be a tax advantage to buying a company through acqui-hiring compared to simply poaching individual employees.
A primary objective of acqui-hiring is to acquire a group of people who are already what?
Answer: Productive when working together.
Explanation: The primary objective of acqui-hiring is to acquire a cohesive group of people who are already productive when working together.
In terms of financial benefits, acqui-hiring may offer what compared to traditional employee poaching?
Answer: More tax advantages.
Explanation: The capital expenditure involved in acqui-hiring may offer more tax advantages compared to traditional employee poaching, depending on the acquisition structure.
Acqui-hiring is most likely to occur under which market condition?
Answer: When talent is scarce within a particular industry.
Explanation: Acqui-hiring is most likely to occur when talent is scarce within a particular industry, making conventional hiring challenging.
According to the source, why is access to talented employees considered a key factor in competitive advantage?
Answer: Because human capital contributes to innovation, productivity, and overall business success.
Explanation: Access to talented employees is considered a key factor in competitive advantage because human capital directly contributes to innovation, productivity, and overall business success.
How does acqui-hiring offer an advantage in terms of scaling recruitment efforts?
Answer: It allows for the hiring of multiple employees simultaneously.
Explanation: Acqui-hiring offers an advantage in scaling recruitment efforts because it allows for the hiring of multiple employees simultaneously, rather than individual recruitment processes.
Which of the following is a strategic benefit that expertise gained from acqui-hiring can provide to a company?
Answer: It can help the acquiring company pivot to a new market sector and increase innovation.
Explanation: The expertise gained from acqui-hiring can help the acquiring company pivot to a new market sector and increase innovation within established firms.
Which of the following is a motivation for entrepreneurs to accept an acqui-hire offer?
Answer: Occupational burnout or a more successful outcome than liquidation.
Explanation: Entrepreneurs may accept an acqui-hire offer due to occupational burnout or because it appears to be a more successful outcome than alternatives like liquidation.
Beyond human capital, what other assets are often acquired in an acqui-hire?
Answer: Intellectual property such as patents, software, datasets, or trade secrets.
Explanation: Beyond human capital, companies often purchase intellectual property such as patents, software, datasets, or trade secrets during an acqui-hire.
Can acqui-hiring also be motivated by a desire to eliminate competition?
Answer: Yes, part of the motivation may be to remove potential competitors from the market.
Explanation: Part of the motivation for acqui-hiring may be to remove potential competitors from the market, in addition to talent acquisition.
Is there a potential tax advantage to acqui-hiring over employee poaching?
Answer: Yes, depending on the specific jurisdiction, there may be a tax advantage.
Explanation: Depending on the specific jurisdiction, there may be a tax advantage to buying a company through acqui-hiring compared to simply poaching individual employees.
After an acqui-hire, the acquired company's product is usually the primary interest of the acquiring firm and is often further developed.
Answer: False
Explanation: In an acqui-hire, the acquired company's product is typically of secondary interest and is often discontinued or 'killed'.
For a successful acqui-hire, the acquiring company typically focuses on integrating the product, not necessarily retaining the original founders.
Answer: False
Explanation: For a successful acqui-hire, the acquiring company usually tries to retain the employees and founders of the acquired company, focusing on talent integration.
Employees in an acquired company typically receive a payout in cash that can be immediately sold.
Answer: False
Explanation: Employees in an acquired company typically receive a payout in stock, often with a restriction that it cannot be sold for a specified period.
The first step in the acqui-hiring process is to integrate the new team into the acquiring company.
Answer: False
Explanation: The first step in the acqui-hiring process is identifying the specific talent needed and locating a startup that possesses this talent.
The ideal time to buy a company during acqui-hiring is when its technology is at the peak of the hype cycle, indicating high market value.
Answer: False
Explanation: The ideal time to buy a company during acqui-hiring is when its value is lower, particularly if its technology is in the trough stage of the hype cycle.
The crucial third step for successful acqui-hiring is to discontinue all of the acquired company's products immediately.
Answer: False
Explanation: The crucial third step for successful acqui-hiring is integrating the new team into the acquiring company and effectively putting them to work, not immediately discontinuing products (though products are often discontinued, it's not the *third step*).
Kaushik Gala and Brandon A. Mueller argue that acqui-hires are more successful when the acquired product is based on proprietary, closed-source technologies.
Answer: False
Explanation: Kaushik Gala and Brandon A. Mueller argue that acqui-hires whose product was based on open-source technologies are more likely to be successful.
What typically happens to the acquired company's product after an acqui-hire?
Answer: It is often discontinued or 'killed'.
Explanation: In an acqui-hire, the acquired company's product is typically of secondary interest and is often discontinued or 'killed' shortly after the acquisition.
What is considered crucial for the success of an acqui-hiring strategy regarding acquired employees?
Answer: Retaining the employees and founders of the acquired company.
Explanation: For an acqui-hiring strategy to be successful, the acquiring company usually tries to retain the employees and founders of the acquired company.
What kind of compensation do employees in an acquired company typically receive in an acqui-hire?
Answer: A payout in stock, often with a restriction that it cannot be sold for a specified period.
Explanation: Employees in an acquired company typically receive a payout in stock, which often comes with a restriction that it cannot be sold for a specified period of time.
What is the first step in the acqui-hiring process?
Answer: Identifying the specific talent needed and locating a startup that possesses this talent.
Explanation: The first step in the acqui-hiring process involves identifying the specific talent that the company needs and then locating a startup that possesses this talent.
According to the text, when is the ideal time to buy a company during the acqui-hiring process?
Answer: When its value is lower, particularly if its technology is in the trough stage of the hype cycle.
Explanation: The ideal time to buy a company during the acqui-hiring process is when its value is lower, particularly if its technology is in the trough stage of the hype cycle.
What is considered the crucial third step for the success of acqui-hiring?
Answer: Integrating the new team into the acquiring company and effectively putting them to work.
Explanation: The crucial third step for the success of acqui-hiring is integrating the new team into the acquiring company and effectively putting them to work.
According to Kaushik Gala and Brandon A. Mueller, what makes acqui-hires more likely to be successful?
Answer: When the acquired product was based on open-source technologies.
Explanation: Kaushik Gala and Brandon A. Mueller argue that acqui-hires whose product was based on open-source technologies are more likely to be successful.
Legal scholars John F. Coyle and Gregg D. Polsky argue that team acquisition is the sole sufficient explanation for acqui-hiring.
Answer: False
Explanation: Legal scholars John F. Coyle and Gregg D. Polsky argue that team acquisition alone is not a sufficient explanation for acqui-hiring, as poaching entire teams is already common in some industries.
A significant downside of acqui-hiring for the acquiring company is the minimal capital expenditure required.
Answer: False
Explanation: A significant downside for the acquiring company in an acqui-hire is the *large* capital expenditure required, not minimal.
Investors might view an acqui-hire unfavorably if they believe the purchase price is too high, benefiting the acquiring firm.
Answer: False
Explanation: Investors might view an acqui-hire unfavorably if they suspect collusion between the acquired and acquiring firms, leading to a *lower* purchase price for the company in favor of higher employee compensation.
Employees from acquired startups tend to remain with the acquiring company at a higher rate than other hires.
Answer: False
Explanation: Employees from acquired startups tend to leave the acquiring company at a higher rate compared to other hires.
An acqui-hire is more likely to be successful if the acquired team is broken up and given individual projects to foster independence.
Answer: False
Explanation: An acqui-hire may not be successful if the acquired team is broken up, as this can lead to employee dissatisfaction and departure.
Founders are more likely to stay with an acquiring company if their acquired team is broken up, allowing them to pursue new individual roles.
Answer: False
Explanation: Founders are more likely to leave an acquiring company if their acquired team is broken up or if they do not receive a high-level position.
Similarities in company culture between the startup and the acquiring company are a significant barrier to acqui-hiring success.
Answer: False
Explanation: Differences in company culture between the startup and the more established acquiring company can be a significant barrier to acqui-hiring success, not similarities.
Acqui-hiring can only lead to investor claims related to intellectual property disputes, not financial misconduct.
Answer: False
Explanation: Acqui-hiring may give rise to various investor claims, including fraud, breach of fiduciary duties, fraudulent transfer, and successor liability, which are related to financial misconduct.
Acqui-hiring always strengthens the enforceability of non-compete agreements and trade secret protections across all jurisdictions.
Answer: False
Explanation: In some jurisdictions, acqui-hiring might help firms bypass non-compete agreements and trade secret protections, and enforceability varies by region.
What argument did legal scholars John F. Coyle and Gregg D. Polsky make regarding team acquisition as a motivation for acqui-hiring?
Answer: Team acquisition alone is not a sufficient explanation for acqui-hiring.
Explanation: Legal scholars John F. Coyle and Gregg D. Polsky argue that team acquisition alone is not a sufficient explanation for acqui-hiring, as poaching entire teams is already common in some industries.
What is identified as a significant downside associated with acqui-hiring for the acquiring company?
Answer: The large capital expenditure required.
Explanation: A significant downside for the acquiring company is the large capital expenditure required for acqui-hiring.
Why might investors in an acquired company view an acqui-hire deal unfavorably?
Answer: They might suspect collusion between the employees of the acquired firm and the acquiring firm, leading to a lower purchase price.
Explanation: Investors in an acquired company might view an acqui-hire deal unfavorably if they suspect collusion between the employees of the acquired firm and the acquiring firm, potentially leading to a lower purchase price for the company.
What is a notable trend regarding employee retention from acquired startups?
Answer: Employees from acquired startups tend to leave the acquiring company at a higher rate compared to other hires.
Explanation: Employees from acquired startups tend to leave the acquiring company at a higher rate compared to other hires, posing a challenge to retention.
Which factor can lead to an unsuccessful acqui-hire concerning employee satisfaction?
Answer: Dissatisfaction with product cancellation, lack of autonomy, or if the acquired team is broken up.
Explanation: An acqui-hire may not be successful if employees leave due to dissatisfaction with product cancellation, a lack of autonomy, or if the acquired team is broken up.
Under what conditions are founders more likely to leave an acquiring company after an acqui-hire?
Answer: If they do not receive a high-level position or if the acquired team is subsequently broken up.
Explanation: Founders are more likely to leave an acquiring company if they do not receive a high-level position or if the acquired team is subsequently broken up.
What significant barrier related to organizational environment can hinder the success of acqui-hiring?
Answer: Differences in company culture between the startup and the more established acquiring company.
Explanation: Differences in company culture between the startup and the more established acquiring company can be a significant barrier to the success of acqui-hiring.
Which of the following is a type of investor claim that can arise from acqui-hiring?
Answer: Fraud, breach of fiduciary duties, fraudulent transfer, and successor liability.
Explanation: Acqui-hiring may give rise to various investor claims, including fraud, breach of fiduciary duties, fraudulent transfer, and successor liability.
In some jurisdictions, how might acqui-hiring relate to non-compete agreements and trade secrets?
Answer: It might help firms bypass non-compete agreements and the protection of trade secrets, though this varies by region.
Explanation: In some jurisdictions, acqui-hiring might help firms bypass non-compete agreements and the protection of trade secrets, though this varies by region, as noted for California.
Amazon and Apple were among the large software companies that attracted widespread media attention for acqui-hiring in the early 2010s.
Answer: False
Explanation: Facebook, Microsoft, Twitter, and Google attracted widespread media attention for acqui-hiring in the early 2010s. Amazon was not listed among these, and Apple was not specifically highlighted in this context.
A 2014 analysis identified Amazon and Apple as the most prolific acqui-hirers.
Answer: False
Explanation: A 2014 analysis identified Facebook, Google, Twitter, Zynga, Yahoo, and LinkedIn as the most prolific acqui-hirers, not Amazon and Apple.
Acqui-hiring is exclusively common in the software and services sectors and has not been observed elsewhere.
Answer: False
Explanation: While particularly common in software and services, acqui-hiring has also been observed in other sectors like agriculture, consumer products, and energy management.
An estimated 25 percent of acquisitions by technology firms in 2011 and 2012 were considered possible acqui-hires.
Answer: False
Explanation: An estimated 50 percent of acquisitions by technology firms in 2011 and 2012 were considered possible acqui-hires.
In 2010, Mark Zuckerberg stated that Facebook primarily buys companies for their innovative products, not their people.
Answer: False
Explanation: In 2010, Mark Zuckerberg stated, 'We have never once bought a company for the company. We buy companies for excellent people,' indicating a focus on human capital.
Instagram was one of Facebook's earliest acqui-hires, acquired in 2007.
Answer: False
Explanation: Facebook's earliest acqui-hire mentioned was Parakey in 2007. Instagram was acquired in 2012, not 2007.
Chatterji's categories for Facebook's acqui-hires include Financial, Market Expansion, and Talent Retention.
Answer: False
Explanation: Chatterji's three categories for Facebook's acqui-hires are Strategic, Innovation, and Product Improvement, not Financial, Market Expansion, and Talent Retention.
Mark Zuckerberg and Sheryl Sandberg are examples of founders acquired by Facebook for strategic high-ranking roles.
Answer: False
Explanation: Bret Taylor, Gokul Rajaram, Sam Lessin, and Peter Wilson are examples of founders acquired by Facebook for strategic high-ranking roles. Mark Zuckerberg and Sheryl Sandberg were not acquired by Facebook in this context.
Mark Zuckerberg stated that hiring entrepreneurs through acqui-hiring helped Facebook streamline its corporate hierarchy.
Answer: False
Explanation: Mark Zuckerberg stated that hiring entrepreneurs through acqui-hiring helped Facebook retain its startup culture, not streamline its corporate hierarchy.
Facebook's acquisition of WhatsApp in 2014 is cited as an example of an innovation-driven acqui-hire that led to rapid product development.
Answer: False
Explanation: Facebook's acquisition of the Beluga messenger service in 2010 is cited as an example of an innovation-driven acqui-hire that led to the rapid development of Facebook Messenger.
Google Glass was developed solely through internal Google R&D, without any contributions from acqui-hired companies.
Answer: False
Explanation: Google Glass resulted from the acqui-hiring of Neven Vision and DNN Research, and patents from MicroOptical Corporation, indicating contributions from acquired companies.
Apple acqui-hired EditGrid in 2008 to enhance its mobile operating system.
Answer: False
Explanation: Apple acqui-hired EditGrid in 2008 for the development of its iWork.com web applications, not to enhance its mobile operating system.
Which of the following companies was NOT specifically mentioned as attracting widespread media attention for acqui-hiring in the early 2010s?
Answer: Amazon
Explanation: Facebook, Microsoft, Twitter, and Google were mentioned as attracting widespread media attention for acqui-hiring in the early 2010s. Amazon was not listed among these.
According to a 2014 analysis of media reports, which of the following companies was NOT identified as one of the most prolific acqui-hirers?
Answer: Amazon
Explanation: A 2014 analysis identified Facebook, Google, Twitter, Zynga, Yahoo, and LinkedIn as the most prolific acqui-hirers. Amazon was not listed among these.
In which economic sectors is acqui-hiring particularly common?
Answer: Software and services sectors, but also observed in others like agriculture and energy management.
Explanation: Acqui-hiring is particularly common in the software and services sectors, but has also been observed in a variety of other sectors, including agriculture and energy management.
What percentage of acquisitions by technology firms in 2011 and 2012 were estimated to be possible acqui-hires?
Answer: 50 percent
Explanation: An estimated 50 percent of acquisitions made by technology firms in 2011 and 2012 were considered possible acqui-hires.
What statement did Facebook CEO Mark Zuckerberg make in 2010 regarding the company's acquisition strategy?
Answer: "We have never once bought a company for the company. We buy companies for excellent people."
Explanation: In 2010, Facebook CEO Mark Zuckerberg stated, 'We have never once bought a company for the company. We buy companies for excellent people,' emphasizing the focus on human capital.
Which seed-funded startup was one of Facebook's earliest acqui-hires, acquired in 2007?
Answer: Parakey
Explanation: One of Facebook's earliest acqui-hires was the seed-funded startup Parakey, acquired in 2007.
Which of the following is NOT one of Chatterji's three categories for Facebook's acqui-hires?
Answer: Financial
Explanation: Chatterji's three categories for Facebook's acqui-hires are Strategic, Innovation, and Product Improvement. Financial is not one of them.
Which of the following individuals was acquired by Facebook for a strategic high-ranking role, as mentioned in the text?
Answer: Bret Taylor from FriendFeed
Explanation: Bret Taylor from FriendFeed is explicitly mentioned as an example of a founder acquired by Facebook for a strategic high-ranking role.
According to Mark Zuckerberg, what was a benefit of hiring entrepreneurs through acqui-hiring for Facebook?
Answer: It helped Facebook retain its startup culture.
Explanation: Mark Zuckerberg stated that hiring entrepreneurs through acqui-hiring helped Facebook retain its startup culture.
Which acquisition is provided as an example of Facebook's innovation-driven acqui-hire, leading to the rapid development of Facebook Messenger?
Answer: The Beluga messenger service in 2010.
Explanation: Facebook's purchase of the Beluga messenger service in 2010 is cited as an example of an innovation-driven acqui-hire that led to the rapid development of Facebook Messenger.
Which companies contributed to the development of Google Glass through acqui-hiring?
Answer: Neven Vision, DNN Research, and MicroOptical Corporation.
Explanation: Google Glass resulted from the acqui-hiring of Neven Vision and DNN Research, and patents/expertise from MicroOptical Corporation.
Apple, Inc. acqui-hired EditGrid in 2008 for the development of what?
Answer: Its iWork.com web applications.
Explanation: Apple Inc. acqui-hired EditGrid in 2008 for the development of its iWork.com web applications.