How to Get Your Start-Up Acquired in Six Months or Less

Fish image via Ivelin Radkov

The story of Zite has been a whirlwind. We launched on March 9, 2011, and closed our acquisition by CNN on Aug. 30 of the same year — just under six months later.

But acquisition was not our original plan. We never built the company with the intention of getting acquired. When we launched Zite, we were thrilled to get such a great reception from the press and hundreds of thousands of new users. Our goal was to use that influx of users to secure series A funding to build a team and compete effectively in a crowded market. But fate intervened, and we got an attractive acquisition offer from CNN, a company that believed in our vision. In hindsight, I can see that there were a few really smart things that we did that made us an excellent acquisition target.

My goal for this article isn’t to give you a silver bullet for getting your company acquired, but rather to offer some insight into what I think are the key reasons that Zite was able to move from launch to transaction in such a compressed timeline.

  • Have a huge product launch — It doesn’t matter how good your product is if people don’t know about it. Once we believed we had the right product, we marketed it very hard. We spent much more money on PR surrounding our launch than was fiscally prudent at the time (we were risking future payroll) because we realized that we had one chance to tell the world that Zite was awesome. This paid off in spades: On launch day, we had print articles in The Wall Street Journal and USA Today, plus dozens of other fantastic pieces. This yielded us top billing in the App Store for free applications, and 125,000 downloads in the first week.
  • Put your best foot forward — We focused much of our product design on the first minutes of the user experience. We knew that if a user never saw our amazing personalization technology, we’d lose them, and they’d think we were just a “me-too” news reader. We put our technology front and center by designing a simple, intuitive set-up experience that yielded immediate delight and serendipity.
  • Have technology that is incredibly difficult to replicate — You’re not going to get bought if the acquiring company thinks they can build the product themselves. Zite had the advantage of almost six years of R&D (we were formerly called Worio), but until we became Zite, we were a technology company with a product problem. Instead of continuing to use the technology on a failed product, we pivoted to Zite. We also seized the opportunity to launch on the iPad, which is the perfect delivery device for the technology.
  • Have a clear vision — We had a vision to change the way people consume information. Zite (the product) and personalization are components of that vision, but we proved that we were not a one-trick pony, and we were excited about innovating on news delivery.
  • Disrupt the market — CNN noticed Zite after we received a cease-and-desist from major media companies, including Time Inc. (which is a cousin of CNN, since both are owned by Time Warner). My boss jokes, “If all of the media companies were able to get their lawyers to send you a letter, then you must be doing something right.” At the time, we weren’t sure how we would work with publishers, and publishers weren’t sure of the value of Zite. We’re now on solid ground with publishers, since they have realized the value of Zite as a discovery engine — but at the time it was a great boost to our visibility among the exact same executives who would later give us an offer for the company.

I want to stress that none of the above points are a guarantee that your company will get acquired — let alone be successful — but they certainly influenced CNN’s decision to buy Zite and, ultimately, our success to date. Look for ways you can integrate these tips into your start-up, and even if you aren’t acquired quickly, you will certainly build a better long-term offering for whatever market you choose to address.

Mark Johnson is CEO of Zite. He was an adviser to the company for almost two years, prior to taking the CEO role. He brings a strong product and technology background, with experience at several successful search start-ups: Powerset (natural-language search, acquired by Microsoft), Kosmix (categorized search, acquired by Walmart), and SideStep (travel search, acquired by Kayak). Most recently, he led product at Bing in San Francisco.


Must-Reads from other Websites

Panos Mourdoukoutas

Why Apple Should Buy China’s Xiaomi

Paul Graham

What I Didn’t Say

Benjamin Bratton

We Need to Talk About TED

Mat Honan

I, Glasshole: My Year With Google Glass

Chris Ware

All Together Now

Corey S. Powell and Laurie Gwen Shapiro

The Sculpture on the Moon

About Voices

Along with original content and posts from across the Dow Jones network, this section of AllThingsD includes Must-Reads From Other Websites — pieces we’ve read, discussions we’ve followed, stuff we like. Six posts from external sites are included here each weekday, but we only run the headlines. We link to the original sites for the rest. These posts are explicitly labeled, so it’s clear that the content comes from other websites, and for clarity’s sake, all outside posts run against a pink background.

We also solicit original full-length posts and accept some unsolicited submissions.

Read more »