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Oh, What a Tangled Web

Do you ever wonder about how entangled the corporate giants of our time are? You already know that the big companies try to outdo each other with new business strategies. But how are they all connected?

Take Tumblr and Yahoo, for example. Did you know that their parent company was Verizon? Scratch beneath the surface of one industry giant and you might very well find another one that is in control.

It is a solid strategy. Buying another company helps a large corporate in a few different ways, but primarily enables it to access skills that it would not normally have had access to.

It is the reason that, for example, eBay initially bought out PayPal. PayPal provided an effective payment solution for the company and offered expertise that eBay did not have at the time. 

The travel eCommerce giant also grew their reach and influence by acquisitioning lots of smaller companies like HomeAway and Hotels.com, and thanks to this smart business move they’ve become one of the most successful companies in their field.

Larger companies might also consider it strategically sound to buy out the competition. It makes sense – if another company is meeting the needs of your market better than you can, and are so gaining market share, taking them over can be a good business strategy.

After all, as the saying goes, “Keep your friends close, and your enemies closer.” Strategically, though, being able to buy out your “enemies” means that you get to cash on their successes as well.

It is also an excellent way to get in new blood and fresh ideas. Sometimes a smaller company is better poised to make and answer changes in the market than a larger one. It may be more in tune with what prospective clients are looking for.

It makes for quite interesting relationships between different companies – companies that you might never have otherwise connected. Like when Amazon acquired Whole Foods, for example. Who would have associated Amazon with organic produce?

Want to check out other interesting connections? See the infographic below for more connections you might not have expected.