Sure, 2017 was a big year for tech mergers and acquisitions--but 2018 broke records. The first half of the year alone saw $2.5 trillion in mergers, setting a pace to make it the biggest year for major corporate deals ever. Red Hat, which went public in 1999, was acquired for a whopping $34 billion by IBM. It was a market leader and large company--but even startups are making massive, greater-than-$1 billion deals, thanks to the fact the world's largest tech firms possess unprecedented spending power. A recent survey by Deloitte revealed that executives are only gearing up for more, with 76 percent saying they anticipate increased deal-flow over the next 12 months.
"Corporations have spending firepower; more companies say their cash levels have increased, and M&A remains the No. 1 intended use of those funds," wrote Russell Thomson, a managing partner of Deloitte's Mergers and Acquisitions Services.
This year brought some dramatic exits for tech and startup entrepreneurs. Here are the nine biggest startup acquisitions of 2018, listed in ascending order of deal size:
9. Amazon puts a Ring on it
Just five years ago, tinkerer Jamie Siminoff went on ABC's Shark Tank, asking for just $700,000 for his company. He walked off without a deal. But after a rebrand (from "DoorBot" to "Ring") and a lot of publicity, the company drew in more than $200 million in venture capital. It now carries the distinction of being the largest company that has ever appeared on Shark Tank. ("Obviously, I think they wish they had invested," Siminoff recently told Inc.) It was no surprise when Amazon paid more than $1 billion to acquire it in February.
8. Nice work if you can get it
Known as "Yelp for job hunters," Glassdoor gives a window onto what working at a company is really like, thanks to testimonials from current and former employees. It was founded by three former Expedia employees in 2007, and by 2015 it was the fastest-growing career website. Recruit Holdings, a Japanese conglomerate that already owns job-search site Indeed.com, made the deal to buy Glassdoor for $1.2 billion in May.
7. Unlocking the big C
It's not easy to make an $81 million exit à la Google seem quaint, but that's what Nat Turner and Zach Weinberg did in April when they sold their latest company, cancer software maker Flatiron Health, to Roche for $1.9 billion. The software, used in cancer centers, gathers data about individual cases to help researchers learn about the disease. While doctors do pay to use the New York City-based service, investors were banking on the potential sales of Flatiron Health's learnings to drugmakers. The company had attracted more than $130 million in venture capital from the likes of Google Ventures, before the offer from the Swiss pharmaceutical giant came through.
6. Fourth time's a charm
Isaac Saldana, one of SendGrid's three co-founders, had already worked on three startups--each failed--before launching SendGrid, which aimed to be a better way to send email. By 2017, it had raised $80 million and had a sparkling new headquarters for more than 350 employees in Denver. Cloud-communications platform Twilio wanted to build into its platform email capabilities, and by buying the company for $2 billion in stock in October, it did just that--proving that sometimes the fourth time can be a charm.
5. PayPal gets Stockholm syndrome
The mobile-payments company iZettle was founded by Jacob de Geer and Magnus Nilsson in Stockholm in 2010. By mid-2018, it had spent roughly a year trying to go public--in what was expected to be Europe's largest-ever financial technology IPO. But by summer, PayPal had made its intentions clear, and ended up acquiring it for $2.2 billion--a move U.K. investigators found could give PayPal too much market dominance there. The company is still answering questions raised by the Competition and Markets Authority.
4. Takes one to know one
Dug Song was an elite hacker employed by a large software and security company when a high-schooler managed to hack into a digital trap he had set. But Song didn't report 17-year-old Jon Oberheide to the authorities; instead, he partnered with him to create a new digital-security company, Duo Security, specializing in two-factor authentication. The Ann Arbor, Michigan-based unicorn was acquired by Cisco for $2.35 billion in August.
3. There's an app (developer) for that
Github, the coding hub and one-time Inc. feature subject, has certainly had its highs and lows. In 2014, controversy forced co-founder Tom Preston-Werner out of his role, after he and his wife were accused of harassing a female employee. And it's chief executive, Chris Wanstrath, stepped down (oddly, for a second time) in August of 2017. But Github was still reporting $200 million in recurring annual revenue. Perhaps more appealing to Microsoft than the revenue was another key metric: 27 million developers use Github. That's a lot of new users for Microsoft's cloud. The deal was done in $7.5 billion in stock, and completed in October.
2. Survey the masses, dine with the classes
The stage wasn't just set for Qualtrics's IPO; dress rehearsals were called. The Provo, Utah-based customer-survey company, which reported $184 million in revenue for the first half of 2018, had already filed for an IPO and even set its IPO price range when it was snapped up by the German enterprise software giant SAP. It acquired the unicorn for $8 billion in cash in November.
1. If you can't beat them, acquire them
India's answer to Amazon was founded in 2007 by two former Amazon employees, who at first set out to sell books online. Sound familiar? By 2017, it had achieved nearly a 40 percent market share of India's e-commerce industry, putting it neck-and-neck with Amazon itself there. In an interestingly structured deal that will allow for Flipkart to go public in the future, Walmart acquired 77 percent of the company in August for $16 billion.