Is Facebook Making Another Purchase?

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Neil
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Is Facebook Making Another Purchase?

Post by Neil »

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Let's be honest.  Facebook buying Oculus VR almost seems like pickles and ice cream.  It's obviously not the most appetizing combination, but it's a fan favorite for pregnant women.  Maybe that's the way we should be looking at this; eating for two...

Would Oculus VR's acquisition and Mike Abrash's "departure" make a lot more sense if Valve was next in line to be acquired by Facebook?

MTBS has never been one to guess and gander...but this could be the meaningful end-game Facebook is working towards.  Share your thoughts below.

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tnylab
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Re: Is Facebook Making Another Purchase?

Post by tnylab »

Well, Oculus needed money to help them make their public version of the Rift as good as possible for mass market.

Valve does not seem to need money from others any time soon, they already have Steam for that.

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Neil
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Re: Is Facebook Making Another Purchase?

Post by Neil »

tnylab wrote:Well, Oculus needed money to help them make their public version of the Rift as good as possible for mass market.

Valve does not seem to need money from others any time soon, they already have Steam for that.

Facebook's deal with Oculus wasn't an investment; it was an acquisition. This is great for VR and immersive technology in general because it's a strong statement of future market valuation - they really did everyone a wonderful service. I don't pretend to know what the ramifications are of such a deal. When a company gets acquired for $X dollars, it's unclear to me if that money just goes to the shareholders as a buy-out and future funding is derived from Facebook's quarterly financial purse (i.e. the $2 billion investment has nothing to do with Oculus' day to day financial operation), or if this acquisition funding is expected to be somehow put back into the company. I have no idea. I really think a deal like this would have happened eventually anyway; it's just a question of whether it was a matter of months or years. This is what we call an "exit strategy" for venture capital investors. It's not a statement of the company's product development intentions or future; it's about how the investors get a fast return on their investment without necessarily having to wait for the company to turn a profit. I think this is all standard procedure when the opportunity presents itself, and it was a really good opportunity.

The Valve scenario is just a fantasy analysis on my part. However, with Valve working hard to launch their Steambox initiatives and directly/indirectly break into the console market + their demonstrated interest in VR and immersive technologies, Facebook could do much worse than buying Valve. Maybe I'm reading way too much into things, but I also think Mike Abrash's transition to Oculus was way too easy. Maybe I watched too much X-Files in my youth. :lol:

Did George Lucas need the money when his company was sold to Disney? I think not.

Anyways, this is just fun and games on my part. There are definitely exciting times ahead for everyone in this market.

Regards,
Neil

tnylab
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Re: Is Facebook Making Another Purchase?

Post by tnylab »

Thank you Neil for these explanations about how the money from Facebook could be used. I did not think about all these venture capital investors things.

Concerning Valve, It would be nice to hear what Gabe Newell thinks about the acquisition of Oculus by Facebook and about the move of Mike Abrash to Oculus.

Hopefully, the next two years will be really interesting for VR ;) .

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Re: Is Facebook Making Another Purchase?

Post by blazespinnaker »

Likely, valve owns ~10% of ovr, so that's about 200m. My guess is valve has had it hard lately with incursions into steam by msft/sony. Acquiring valve would put them in Msfts radar.

I'd guess that gabe is happy with his return from Facebook and Can't really complain losing a star employee to his benefactor. Rather than an acquisition, I see partnership.

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Re: Is Facebook Making Another Purchase?

Post by Neil »

blazespinnaker wrote:Likely, valve owns ~10% of ovr, so that's about 200m. My guess is valve has had it hard lately with incursions into steam by msft/sony. Acquiring valve would put them in Msfts radar.

I'd guess that gabe is happy with his return from Facebook and Can't really complain losing a star employee to his benefactor. Rather than an acquisition, I see partnership.

I had no idea that Valve owned any part of Oculus. Is this just a guess on your part?

Regards,
Neil

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Re: Is Facebook Making Another Purchase?

Post by blazespinnaker »

Yes, speculation. However, if OVR is using important IP built by a Valve employee, what else can you conclude?

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Neil
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Re: Is Facebook Making Another Purchase?

Post by Neil »

blazespinnaker wrote:Yes, speculation. However, if OVR is using important IP built by a Valve employee, what else can you conclude?

I conclude...NOTHING! Sometimes my Schneider-sense is tingling...sometimes I just have a cold.

Regards,
Neil

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Re: Is Facebook Making Another Purchase?

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