Here's what it's like when Apple wants to buy your company

Posted:
in General Discussion
Six years after Apple bought his transit app firm, David Hodge has revealed the tensions, the secrecy, and the conditions that Apple puts you through while buying your firm.

The road to Apple. David Hodge has revealed how his transit app company was bought for Apple Maps
The road to Apple. David Hodge has revealed how his transit app company was bought for Apple Maps


Back in 2013, while everyone else was watching Apple unveil macOS Mavericks, David Hodge was missing WWDC announcements because he was in the middle of selling his company. Even as Apple presented its news that Apple Maps was adding the 3D flyover, it was already negotiating to acquire Hodge' firm and improve future versions of its maps.

Now, six years later, Hodge has revealed a step by step account on Twitter of what happens when Apple buys your company.

2. What's it like to sell your company? Well, it's a hellish process that might kill your company if it doesn't work. Also, there's lots of paperwork.

This is what my dining room table looked like on day 1 of diligence. pic.twitter.com/2u3I8hCIEU

-- David Hodge (@DavidHodge)


In a series of 15 tweets, Hodge recounts how his company Embark was invited to visit Apple. At the time, Embark was an independent firm adding public transit features to Apple Maps in iOS 6

Ostensibly, this meeting at Apple was to discuss an improvement to a developer API that Embark wanted Apple to do.

"Turned out it was an audition for an acquisition," tweeted Hodge.

Even once Apple had made its intentions clear, and even though ultimately it did buy Hodge's Embark firm, the journey was fraught.

The Embark team circa 2013, when the company was bought by Apple.
The Embark team circa 2013, when the company was bought by Apple.


"What's it like to sell your company?" continues Hodge. "Well, it's a hellish process that might kill your company if it doesn't work."

While Hodge does not disclose what sums Apple eventually paid for the firm, he does reveal some of his costs. Simply negotiating with Apple required legal advice that cost dearly and ate into Embark's reserves. It ate into money that Hodge describes as the company's runway, the funds it had to keep going while it was growing.

"We also managed to rack up $195,000 in legal bills for a deal that might not close," he says. "Our runway went from a comfortable [approximately] 16 months to 8."

AppleInsider has spoken off the record with other firms who have been through this process and they confirm how constantly uncertain it is. Apple has a history of looking at multiple companies for similar purposes, such as when the original iTunes was made from SoundJam instead of Panic Software's Audion.

Similarly, AppleInsider has also reported on accounts from companies such as Luna Display who say Apple "used us for market research" before producing a rival to that firm's product.

Hodge reports that Apple even bought one of his firm's rivals.

"As I was in a meeting with the [Mergers & Acquisitions] team at One Infinite Loop," he continues, "the news leaked that Apple bought our competitor Hop Stop. My phone started blowing up. What did this mean for us?"

The old Embark app before being acquired by Apple
The old Embark app before being acquired by Apple


The protracted and serious secrecy over the negotations with Apple, says Hodge, put family relationships "under heavy strain." And Hodge himself started to have physical problems.

"Wasn't sleeping well," he explains, "and had developed an excruciating issue with my jaw from apparently clenching as I slept."

On August 13, 2013, the deal was completed -- but the secrecy was not over. "We still couldn't tell anyone... So we celebrated by throwing a party for my co-founder's cat."

David Hodge and his colleagues joined Apple as part of the deal and Embark's features were incorporated into Apple Maps. Hodge stayed with Apple until 2016, shortly after which, he tweeted about the impact his company had brought to Apple Maps.

2/ Specifically, a year ago Apple announced Transit at WWDC. Was a highlight to eight years working on Transit / Mobility at Embark & Apple.

-- David Hodge (@DavidHodge)


Apple's most recent improvements to its maps include the addition of the Street View-like Look Around and greater detailing, including transit improvements, to major US cities.
applesnoranges
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Comments

  • Reply 1 of 25
    sdw2001sdw2001 Posts: 17,078member
    I'm sure the process isn't easy.  However, this really comes off as whining to me.  Oh, you were stressed in your business life because an international company wanted to acquire your firm?  You're kidding.  You let it seep into your professional life?  Go figure.  The owner's entire story comes across like something that happened to him, as if he had no control whatsoever.  Any business owner should go in with eyes wide open.  Did he not anticipate legal fees and stress and the possibility the deal would fall through?  Did he not have contingency plans?  Did he not get some kind of assurance from Apple that they would help make him whole if it didn't come to pass?  Responsible owners do these things.  He obviously was interested, otherwise he would have shut it down right away.  I don't see any accusation that Apple made him sell or threatened his existing relationship.  

    Now, as a former Apple employee, he gets to talk about how hard it was.  I'm just not sympathetic.  
    gutengelRayz2016razorpitmichelb76MacProrandominternetpersonlarz2112MacQctzm41lolliver
  • Reply 2 of 25
    gutengelgutengel Posts: 339member
    Your autoplay Ai YouTube videos are pretty annoying. Having an ad play AFTER you tried to pause the first autoplay is x10 more annoying!
    retrogustowatto_cobra
  • Reply 3 of 25
    lkrupplkrupp Posts: 7,454member
    gutengel said:
    Your autoplay Ai YouTube videos are pretty annoying. Having an ad play AFTER you tried to pause the first autoplay is x10 more annoying!
    Depending on which version of Safari you are currently running you can turn off auto-play on a website-by-website basis. Under the Safari app dropdown menu select “Settings for This Website” and elect the auto-play option you desire. If you are using some other browser then check for the same option. Videos do not auto-play when I visit AppleInsider.
    watto_cobra
  • Reply 4 of 25
    dysamoriadysamoria Posts: 2,333member
    sdw2001 said:
    I'm sure the process isn't easy.  However, this really comes off as whining to me.  Oh, you were stressed in your business life because an international company wanted to acquire your firm?  You're kidding.  You let it seep into your professional life?  Go figure.  The owner's entire story comes across like something that happened to him, as if he had no control whatsoever.  Any business owner should go in with eyes wide open.  Did he not anticipate legal fees and stress and the possibility the deal would fall through?  Did he not have contingency plans?  Did he not get some kind of assurance from Apple that they would help make him whole if it didn't come to pass?  Responsible owners do these things.  He obviously was interested, otherwise he would have shut it down right away.  I don't see any accusation that Apple made him sell or threatened his existing relationship.  

    Now, as a former Apple employee, he gets to talk about how hard it was.  I'm just not sympathetic.  
    Your comments sound incredibly out of touch and you’re not paying attention. Of course Apple had all the control. Apple had (has) virtually limitless resources to draw on and the company being acquired did not. Did you even read the article? Hint: Look for the legal fees part. 

    Your utter lack of sympathy comes off as entirely callous, and your complaint about the guy “whining” makes you sound like a frighteningly irrational corporate fanatic who cannot allow for anyone else’s unpleasant experiences with Apple to be real.
    CloudTalkinzoetmbgatorguyretrogustoviclauyycphilboogieflyingdpmark fearingMissNomerdavgreg
  • Reply 5 of 25
    SpamSandwichSpamSandwich Posts: 31,497member
    I bet the slags at “Beats by Dre” didn’t go through any of this.
    edited October 8 davgreg
  • Reply 6 of 25
    larz2112larz2112 Posts: 289member

    2. What's it like to sell your company? Well, it's a hellish process that might kill your company if it doesn't work. Also, there's lots of paperwork.
    This is what my dining room table looked like on day 1 of diligence. pic.twitter.com/2u3I8hCIEU



    In my world that is not considered "lot's of paperwork", especially for something like an acquisition. I guess everything is relative to your own experiences. But no matter, I'm sure that getting aquired by a company like Apple is a hellish process. 
    edited October 8 randominternetperson
  • Reply 7 of 25
    The size of the company probably makes a big difference. If you’re Beats, you can afford to assign a team of lawyers and accountants to handle a lot of the paperwork, and the fees will be trivial to your bottom line. If you’re a tiny startup, you don’t have a ton of extra cash on hand and your team is probably already stretched thin, so the relatively large drain on resources can exacerbate an already precarious situation. 
    lolliverapplesnorangeswelshdogwatto_cobra
  • Reply 8 of 25
    philboogiephilboogie Posts: 7,494member
    larz2112 said:
    In my world that is not considered "a lot of paperwork", especially for something like an acquisition. I guess everything is relative to your own experiences. But no matter, I'm sure that getting aquired by a company like Apple is a "hellish process". 
    Perhaps he meant to say that Apple isn't as green as they pretend to be.

    muthuk_vanalingam
  • Reply 9 of 25
    dysamoria said:
    sdw2001 said:
    I'm sure the process isn't easy.  However, this really comes off as whining to me.  Oh, you were stressed in your business life because an international company wanted to acquire your firm?  You're kidding.  You let it seep into your professional life?  Go figure.  The owner's entire story comes across like something that happened to him, as if he had no control whatsoever.  Any business owner should go in with eyes wide open.  Did he not anticipate legal fees and stress and the possibility the deal would fall through?  Did he not have contingency plans?  Did he not get some kind of assurance from Apple that they would help make him whole if it didn't come to pass?  Responsible owners do these things.  He obviously was interested, otherwise he would have shut it down right away.  I don't see any accusation that Apple made him sell or threatened his existing relationship.  

    Now, as a former Apple employee, he gets to talk about how hard it was.  I'm just not sympathetic.  
    Your comments sound incredibly out of touch and you’re not paying attention. Of course Apple had all the control. Apple had (has) virtually limitless resources to draw on and the company being acquired did not. Did you even read the article? Hint: Look for the legal fees part. 

    Your utter lack of sympathy comes off as entirely callous, and your complaint about the guy “whining” makes you sound like a frighteningly irrational corporate fanatic who cannot allow for anyone else’s unpleasant experiences with Apple to be real.
    Wow, something struck a nerve.

    I'm with '2001 on this one.  I don't know if I'd call it "whining" exactly, but there's very little there that is surprising or unexpected.  If you're a three-person firm looking to get acquired by a huge corporation, it's going to be stressful, time consuming, and expensive.  As for that being a lot of paperwork, have you bought a house lately?  Or been audited, or written a grant proposal?
    13485larz2112MacQcfastasleeptzm41lolliversdw2001watto_cobra
  • Reply 10 of 25
    apple ][apple ][ Posts: 8,742member
    It does come off as whining and complaining.

    Of course there are bound to be large legal fees associated with such a deal. Of course there will be lots of paper work. Of course there will be secrecy. This goes without saying.

    If the dude didn't want to sell the company, then they shouldn't have done it, if they can't handle everything that comes with it.
    MacQclolliversdw2001watto_cobra
  • Reply 11 of 25
    mdriftmeyermdriftmeyer Posts: 7,321member
    apple ][ said:
    It does come off as whining and complaining.

    Of course there are bound to be large legal fees associated with such a deal. Of course there will be lots of paper work. Of course there will be secrecy. This goes without saying.

    If the dude didn't want to sell the company, then they shouldn't have done it, if they can't handle everything that comes with it.
    This is the Millennial Generation who have no fucking clue the R&D NeXT and then Apple invested to make their ``start ups'' possible via the App Store, and then bitch there is paperwork and other reviews to go through. This is the way of Business in Silicon Valley and other Fortune 100/500/1000 space, period.
    lolliversdw2001watto_cobra
  • Reply 12 of 25
    ParrParr Posts: 7unconfirmed, member
    After dealing with Apples Legal team for months, it’s something that I wouldn’t wish on anybody, no matter what.  They can be a very, very aggressive force, with what appears to be an unlimited budget in dollars, attorneys, and time.

    And they will use ANY method possibly to win.
    The most polite way to describe them is that “They are NOT nice.“ I would prefer to use other words, but then this post would be blocked.

    They have changed my opinion 180 degrees about Apple as a company. And definitely not for the better. They can chew up small companies, and people very easily, without any regard for the companies, individual or families.

    And I don’t think that Tim Cook has a clue about how ruthless his company can really be.
    welshdogmuthuk_vanalingamgatorguysingularity
  • Reply 14 of 25
    apple ][ said:
    It does come off as whining and complaining.

    Of course there are bound to be large legal fees associated with such a deal. Of course there will be lots of paper work. Of course there will be secrecy. This goes without saying.

    If the dude didn't want to sell the company, then they shouldn't have done it, if they can't handle everything that comes with it.
    This is the Millennial Generation who have no fucking clue the R&D NeXT and then Apple invested to make their ``start ups'' possible via the App Store, and then bitch there is paperwork and other reviews to go through. This is the way of Business in Silicon Valley and other Fortune 100/500/1000 space, period.
    M&A is never easy and DD usually takes a lot of effort, but Apple's team is in a different league compared to other comparable companies such as Google or FB from what I learned with people who have direct experience working with most of those companies.
    watto_cobra
  • Reply 15 of 25
    sdw2001sdw2001 Posts: 17,078member
    dysamoria said:
    sdw2001 said:
    I'm sure the process isn't easy.  However, this really comes off as whining to me.  Oh, you were stressed in your business life because an international company wanted to acquire your firm?  You're kidding.  You let it seep into your professional life?  Go figure.  The owner's entire story comes across like something that happened to him, as if he had no control whatsoever.  Any business owner should go in with eyes wide open.  Did he not anticipate legal fees and stress and the possibility the deal would fall through?  Did he not have contingency plans?  Did he not get some kind of assurance from Apple that they would help make him whole if it didn't come to pass?  Responsible owners do these things.  He obviously was interested, otherwise he would have shut it down right away.  I don't see any accusation that Apple made him sell or threatened his existing relationship.  

    Now, as a former Apple employee, he gets to talk about how hard it was.  I'm just not sympathetic.  
    Your comments sound incredibly out of touch and you’re not paying attention. Of course Apple had all the control. Apple had (has) virtually limitless resources to draw on and the company being acquired did not. Did you even read the article? Hint: Look for the legal fees part. 

    Your utter lack of sympathy comes off as entirely callous, and your complaint about the guy “whining” makes you sound like a frighteningly irrational corporate fanatic who cannot allow for anyone else’s unpleasant experiences with Apple to be real.
    I read the entire article and I acknowledged that I imagined it would be difficult doing business like that. However, my comment stands. This didn’t “happen” to him. There is no evidence that Apple threatened his existing relationship. I’m sure there were legal fees and I’m sure it was difficult. But he acts as if Apple committed some crime against him. In the end he got to sell his company for what I imagine was a hefty profit. I really don’t want to hear it. By the way, you have no idea who I am so I will thank you not to cast personal aspersions and make ad hominem attacks.
    edited October 8 watto_cobra
  • Reply 16 of 25
    Parr said:
    And I don’t think that Tim Cook has a clue about how ruthless his company can really be.
    I doubt it. Tim is, by all accounts, an exceptionally driven person, and rather intimidating in situations where someone has dropped the ball. I think he's very much on top of everything that happens in the company and, as a CEO should, sets the culture by example.
    watto_cobra
  • Reply 17 of 25
    kevin keekevin kee Posts: 1,143member
    larz2112 said:

    2. What's it like to sell your company? Well, it's a hellish process that might kill your company if it doesn't work. Also, there's lots of paperwork.
    This is what my dining room table looked like on day 1 of diligence. pic.twitter.com/2u3I8hCIEU



    In my world that is not considered "lot's of paperwork", especially for something like an acquisition. I guess everything is relative to your own experiences. But no matter, I'm sure that getting aquired by a company like Apple is a hellish process. 
    I deal with that amount on daily basis. Should I post my 'heartache' to the internet? Hmmm....
    watto_cobra
  • Reply 18 of 25
    welshdogwelshdog Posts: 1,695member
    When I worked for Apple in my home as an iOS support rep, it was difficult. I had never worked for any large company and had no idea to what degree they try to control you. I had only worked for TV stations and video post houses where I was treated as an adult who could manage his own affairs. I was left to do my job and not monitored, measured or evaluated at every turn like I was at Apple. I managed to get through a month of training and two weeks of taking calls and I had to quit. It was the only time in my life where I quit a job without having another lined up. I could not sleep, had involuntarily lost 20 pounds, was having exaggerated gag reflex problems and was losing my sanity.  My manager watched, timed and measured everything I did. And I couldn't mentally detach from the calls I took - particularly the ones that went poorly or involved a person who I could not help successfully.

    Okay, so yeah some of that is my problem, but some isn't. Apple can be tough to deal with both as an employee and as an acquisition target. I understand how this guy was feeling. I also recognize that they have to be this way because otherwise they will get taken advantage of. I bet there are a lot of scammy, crap companies out there that would love to get snapped up by Apple and probably pitch themselves all the time.  I know Apple watches the CSRs so closely, because in the past too many did a bad job, stole hours, angered customers and generally screwed Apple over. So they have no choice but to be tough and a bit heavy handed. Knowing this is great, but it doesn't make it any easier to engage with them. Full disclosure, I'm 62 years old and was 56 when I worked for Apple.
    muthuk_vanalingamwatto_cobra
  • Reply 19 of 25
    welshdog said:
    When I worked for Apple in my home as an iOS support rep, it was difficult. I had never worked for any large company and had no idea to what degree they try to control you. I had only worked for TV stations and video post houses where I was treated as an adult who could manage his own affairs. I was left to do my job and not monitored, measured or evaluated at every turn like I was at Apple. I managed to get through a month of training and two weeks of taking calls and I had to quit. It was the only time in my life where I quit a job without having another lined up. I could not sleep, had involuntarily lost 20 pounds, was having exaggerated gag reflex problems and was losing my sanity.  My manager watched, timed and measured everything I did. And I couldn't mentally detach from the calls I took - particularly the ones that went poorly or involved a person who I could not help successfully.

    Okay, so yeah some of that is my problem, but some isn't. Apple can be tough to deal with both as an employee and as an acquisition target. I understand how this guy was feeling. I also recognize that they have to be this way because otherwise they will get taken advantage of. I bet there are a lot of scammy, crap companies out there that would love to get snapped up by Apple and probably pitch themselves all the time.  I know Apple watches the CSRs so closely, because in the past too many did a bad job, stole hours, angered customers and generally screwed Apple over. So they have no choice but to be tough and a bit heavy handed. Knowing this is great, but it doesn't make it any easier to engage with them. Full disclosure, I'm 62 years old and was 56 when I worked for Apple.
    CSR is a hellish job all around. You would have had that experience for any large company’s call center. Spoken from personal experience(s).
    watto_cobra
  • Reply 20 of 25
    sdw2001 said:
    I'm sure the process isn't easy.  However, this really comes off as whining to me.  Oh, you were stressed in your business life because an international company wanted to acquire your firm?  You're kidding.  You let it seep into your professional life?  Go figure.  The owner's entire story comes across like something that happened to him, as if he had no control whatsoever.  Any business owner should go in with eyes wide open.  Did he not anticipate legal fees and stress and the possibility the deal would fall through?  Did he not have contingency plans?  Did he not get some kind of assurance from Apple that they would help make him whole if it didn't come to pass?  Responsible owners do these things.  He obviously was interested, otherwise he would have shut it down right away.  I don't see any accusation that Apple made him sell or threatened his existing relationship.  

    Now, as a former Apple employee, he gets to talk about how hard it was.  I'm just not sympathetic.  
    And you come across as a callous un empathic person to say the least. 

    Who certainly seems to be unaware of the pressures of running a small business, gambling your financial position, your families position, your colleagues and potentially friends, your work life balance of running a company and dealing with all of this. In a cloud of secrecy without any guarantees trying to do what's best with an incredibly difficult and often seemingly deliberately obstructive company.

    I'd wager you don't have experience of the above or dealing with Apple in this regard.

    Fair play to him for speaking out, it must of been difficult trying to work out if what was happening is the best thing to do or worthwhile.


    edited October 9
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