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MagicDiligence (< 20)

5 of the Best Tech Acquisitions Ever



November 30, 2012 – Comments (0) | RELATED TICKERS: MSFT , AAPL , VMW

In honor of Evan Niu's worst tech acquisitions article, here's my top 5 tech acquisitions... 

5) Google buying YouTube for $1.65 billion in 2006.  Youtube should generate about $3.5 billion in revenue this year, about double 2012.  Online video portals are a highly contested area right now and Google is sitting pretty as Youtube is easily the most ubiquitous and heavily trafficked of the lot.     


4) eBay buying Paypal for $1.5 billion in 2002.  Paypal today is about a $6 billion revenue outfit and continues to grow at double-digit rates, proppling up the lagging auction website.  It is one of the biggest payment processors in the world.   


3) EMC buying VMware in 2003 for $635mm in 2004.  A shrewd purchase just before virtualization started to take off as a networking strategy.  Today, EMC's stake in VMware is worth a cool $32 billion, a nifty 50x return!     


2) Apple's $432 million purchase of NeXT in 1996.  With this, Apple acquired the technical underpinnings for both their desktop (Mac OS X) and mobile (iOS) operating systems - programming class names still start with "ns"!  They also bought some amazing engineering talent in Avie Tevanian and Scott Forstall, the "OGs" of Mac OS X and iOS, respectively.  And, of course, the move brought Steve Jobs back to Apple.  A transformative acquisition that is a very close 2nd to Microsoft's move.   


1) Microsoft buying 86-DOS from Seattle Computer in 1981 for $50,000!  The company licensed MS-DOS as a product for over a decade and then wrote a graphical layer over it.  You might of heard of it, it's called Windows?  The core MS-DOS kernal is still a part of Windows 7.  One of the greatest tech companies ever owes its entire existence to this singular, shrewd acquisition.  

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