Big Tech’s ‘Voracious Appetite,’ or Entrepreneurs Who Dream of Acquisition? Regulation and the Interpenetration of Corporate Scales

At a conference of technology entrepreneurs in 2015, a moderator introduced a panel of executives in charge of mergers and acquisitions (M&A) for Facebook, Google, Twitter, and Yahoo. ‘We put it on the Eventbrite invitation: “What one question do you want answered?,”’ he announced. ‘By far, the audience’s most common response was “how do we get on your radar?”’ (Foundersuite, 2015). This event was not atypical; law firms who conduct and profit from corporate acquisitions host such panels regularly, and they archive them on YouTube for consumption by hopeful entrepreneurs everywhere. They indicate that dominant technology firms have become so not by internal expansion alone, but also by acquiring other firms. Between 2015 and 2020, Amazon made 42 acquisitions; Apple 33; Facebook 21; Google (Alphabet) 48; and Microsoft 53 (Motta and Peitz, 2020, citing multiple sources). These Big Tech companies, colloquially referenced as GAFAM, and their acquisitions, have come under public and regulatory scrutiny for their anti-competitive effects. What is rarely recognized is that Big Tech’s tendency to acquire startups and absorb their intellectual property, workers, and user base owes not only to its own ‘voracious appetite,’ as both the popular press and scholars describe it (Tiku, 2017; Glick et al., 2021). This tendency is also driven by the supply side, as it were, in that many founders of technology startups – and their investors – want to get acquired. This paper problematizes a popular but increasingly anachronistic view of competition which holds that entrepreneurs invent new products to win market share from incumbents. In the contemporary technology sector, this idealized process is often short-circuited; it is now common for startups to develop products which deliberately aim to compliment or enhance the offerings of established companies. The goal of many startups is not to compete with, but to get incorporated into, Big Tech. This current reality