The New Reality of R&D

Big companies used to pour huge money into long-term research, looking to create products that might pay off a decade down the road. No longer.

The New Reality of R&D
[Illustration by Owen Gildersleeve, Photo by Sam Hofman]

Today, corporations are much more likely to just buy research that fits their needs, then integrate it into preexisting products or strategies. After all, sinking vast sums into homegrown R&D is risky, whereas purchasing a startup can cut down on both costs and uncertainty. That fundamental shift is visible in a slew of ­acquisitions by major companies over the past few years.



Key Acquisition: R2 Studios
Result: This startup held more than two dozen patents related to smart appliances and the Internet of Things when it was picked up by Microsoft last year for an undisclosed amount. The technology has become part of the Xbox One.
Also bought: Apiphany, ­MetricsHub, Netbreeze, ­Perceptive Pixel, StorSimple


Key Acquisition: Bluefin Labs
Result: People love tweeting about television, so it made sense when Twitter dropped a reported $90 million on TV-focused data-­analytics company Bluefin Labs in 2013. Its technology now drives Twitter ad platform Amplify.
Also bought: BackType, ­Crashlytics,, Lucky Sort, Spindle Labs, Trendrr


Key Acquisition: HaloIPT
Result: This company was among the first to make wireless electric-car charging commercially available. Buying it was a departure for Qualcomm, which spent an undisclosed amount for it in 2011. It’s now known as Qualcomm Halo.
Also bought: Atheros, DesignArt Networks, Digital Fountain, ­Pixtronix, Rapid Bridge



Key Acquisition: Tealeaf
Result: IBM bought Tealeaf in 2012 for an undisclosed sum and integrated the online-customer-­experience tracker (with its name intact) into its Smarter Commerce retail-management software.
Also bought: DemandTec, Star Analytics, StoredIQ, Xtify


Key Acquisition: Parse
Result: Facebook’s 2013 purchase of this app-developer tool kit for a reported $85 million drove home how serious it is about transitioning into mobile.
Also bought: Branch, Little Eye Labs, Monoidics, Onavo, ­SportStream


Key Acquisition: Chomp
Result: In 2012, Apple snatched up this app-discovery technology for a reported $50 million. The name has since been retired, and it’s now integrated into iTunes and the App Store’s search engine.
Also bought: Burstly, HopStop, Locationary, SnappyLabs, Topsy



Key Acquisition: API Healthcare
Result: API provides scheduling and workflow software for hospitals and staffing agencies. GE bought the company for an undisclosed sum in early 2014 and will fold it into its health care business.
Also bought: Avio Aviation, ­Converteam, SmartSignal, Thermo Fisher Scientific


Key Acquisition: Liquavista
Result: Amazon bought the screen-technology innovator in 2013 for an undisclosed price in ­order to improve its next generation of Kindles and Kindle Fires. The company has also created a color e-ink display that may show up on the Kindle
Also bought: Goodreads, IVONA Text-to-Speech, Quorus, UpNext


About the author

Skylar is an Editorial Assistant at Fast Company. He's previously written for Popular Mechanics, Esquire, Dwell and his hometown Chicagoland suburb newspaper


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