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Facebook’s First Indian Acquisition: Bad Negotiation On Little Eye’s Part

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As reported in our article Facebook In Talks To Buy India Based Start-up Little Eye, finally Facebook acquired the Indian start-up firm Little Eye Labs based out of Bangalore.

Facebook’s first acquisition from India – Little Eye Labs – a performance analytics company for mobile. A lot of people are very excited with this news but let us take a deep breath and think, is this really a good deal?

The deal is rumored to be around $10-15 million and the entire Little Eye Labs team is supposed to move to California as part of the deal. Who gets the exit?

Early stage funds and VCs invest more than this amount in technology start-ups these days. Didn’t the founders believe in their ability to build a company and earn more? The company even had investors and board advisors. Did none of them believe in the company’s future?

If the $10 million figure is correct, this is just the cost of talent acquisition for Facebook looking at the size of the team at Little Eye Labs. I just wonder if the security of a little cash and a job at an MNC was all the founders wanted, why they started on their own in the first place.

Young Indian start-ups need some really solid negotiators on their board. This deal looks a great win for Facebook, but not a great exit for Little Eye Labs I guess.

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Varun Arya

The author holds a Master's Degree in Business Administration from IIM Rohtak and is currently associated with Happiest Minds Technologies Pvt. Ltd, Bangalore as Senior Business Analyst.

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