Under Ballmer’s Reign at Microsoft, 41 VC-Backed Company Acquisitions

Much has been written about Steve Ballmer’s decision to step down as Microsoft CEO and what it says about the technology industry’s migration away from a PC-centric world order.

Here is something else: Over his 13-year reign on the throne of the once dominant software king, Ballmer presided over the acquisition of at least 41 venture-backed technology companies, or roughly three a year.

While it seems like a small number, given the modern day habits of such active acquirers as Google, Facebook and Yahoo, it is nonetheless an interesting record.

At the top of the list is the eye-popping $8.5 billion 2011 purchase of Skype. In the absence of a financial analysis of the benefits of this deal, it is hard to believe the value was fully achieved. Skype’s backers include Index Ventures, Bessemer Venture Partners and Draper Fisher Jurvetson, among others.

A deal that is likely looked upon as being a greater success is the $1.2 billion acquisition in 2012 of Yammer, which was eventually integrated into the Office division. Yammer’s backers included DFJ, Charles River Ventures, Emergence Capital Partners and Khosla Ventures.

Not included on the list is aQuantive, the publicly traded ad network it bought in 2007 for more than $6 billion and then largely wrote off. Not included as well is last week’s announced purchase of Nokia’s cell phone unit, which also is a division of a public company.

Below are a couple of the other Microsoft acquisitions of VC-backed companies listed in the Thomson Reuters database. VCJ subscribers can read more about it here.

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  • Calista Technologies, which raised about $4.6 million from Greylock Partners and Lightspeed Venture Partners, was acquired in early 2008;
  • DATAllegro, which raised more than $64 million from Intel Capital and Venrock, among others, was acquired in late 2008;
  • Kidaro, which raised $14 million from Storm Ventures and other and was acquired in 2008;
  • MongoMusic, which raised $7.4 million from BlueRun Ventures, Draper Richards and others and was acquired for $65 million in late 2000.
  • Navic Networks which raised $52 million FirstMark Capital, Highland Capital Partners and others and was acquired in 2008;
  • Sentillion, which raised about $30 million from Intersouth Partners, Polaris Venture Partners and others and was acquired in late 2009; and
  • Tellme Networks, which raised $263 million in several rounds from the Barksdale Group, Benchmark Capital and Kleiner Perkins Caufield & Byers, among others and was acquired in 2007.

Photo of Microsoft Corporate Vice President Joe Belfiore (left to right) is joined by Microsoft CEO Steve Ballmer and actress Jessica Alba during the launch of Windows Phone 8 in San Francisco, Oct. 29, 2012. REUTERS/Robert Galbraith.

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1 Comment

  • During Steve’s tenure, Microsoft failed to diversify itself in any significant way. 90% of their revenue still comes from operating systems and desktops – exactly the way it was when he first got there.

    Ballmer shoud’ve been fired years ago. Microsoft badly needs a shakeout and a re-focus to create the wonderful growth company Bill ran through 2000.

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