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· Posted on
February 21, 2024

Zendesk has canned its Momentive acquisition

In the words of Ariana Grande, shareholders are saying 'thank you, next'.

What's the key learning?

  • Zendesk was set to acquire Momentive for US$4.1 billion, but shareholders have vetoed the acquisition
  • The company says it's now planning to try and develop its own products that expand the platform
  • As tech companies mature, they often face the age old decision: build their own products, or buy a company that's already doing it?

Background: Zendesk creates customer service tools for companies, and in October last year, it said it was going to acquire Momentive Global (the owners of SurveyMonkey).

What happened: Now, the company's had to pack the deal in after shareholders vetoed the acquisition.

What else: The company says it's now planning to try and develop its own products that expand the platform. In other words, it's taking the build over buy strategy.

🔔 What's the key learning?

💡As tech companies mature, they often face the age old decision: build their own products, or buy a company that's already doing it?

💡Gmail is an example of a pure 'build' project. It was built internally, tested internally, and finally released. But Google's Nest Labs is a 'buy' - it had no smart home division, and it needed one fast. So they snapped up Nest.

💡There's no right or wrong way to approach this decision, but clearly Zendesk's shareholders either didn't value SurveyMonkey's tech...or didn't like the price Zendesk was going to pay for it.

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