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Game of (data) thrones

Facebook, Apple, Microsoft, Google, Amazon (FAMGA) all have a shared mantra: Data is the most valuable “raw material” of the world to explore and exploit. With FAMGA being less risk-adverse than the shareholder-driven companies of the industrial era, their venture activities sometimes surprise legacy industries and are interesting to take a closer look at.
Who Thomas Winther Poulsen, COO, Innovation Centre Denmark Silicon Valley

Acquisitions: Data gathering and call options on the future

Since Microsoft’s first transaction in 1987, FAMGA has acquired close to 900 companies combined. Almost 3 out of 4 acquisitions originate in the US and 5 pct. are from the UK or Canada. The other most popular countries based on FAMGA acquisitions are: Israel, Sweden, France, Germany, Finland, India, Ireland, Switzerland and Denmark.
FAMGA and other large tech companies do not stop acquiring businesses during financial crisis – quite the opposite. They might even use the situation to get a more favorable price when other shareholders and investors might be in need of cash influx.

What does the M&A tells us about the strategic interests of FAMGA? 

  • Facebook, $27bn – messaging, mobile, gaming, media, analytics and AR/VR.
  • Amazon, $21bn – media, e-commerce, computing hardware, robotics, supply chain excellence, entertainment, smart homes and healthcare.
  • Microsoft, $65bn – data management, gaming, storage, HR and worktech, business intelligence, robotics, application and data integration, collaboration, conferencing, analytics, infrastructure and education.
  • Google, $29bn – a little bit of everything tech.
  • Apple, $8bn – healthcare, monitoring, application and data integration and management, sound, entertainment, navigation, gaming, and database and storage management.

three takeaways

  1. Have enough disposable cash to buy when prices are too good to let go, and to buy when it makes strategic sense.
  2. Have a global outlook when looking for talent, innovation and technology—nothing spurs innovation like people experiencing problems, inefficiencies and scarcity.
  3. Have a diligent but healthy risk appetite.

Corporate Venture Capital (CVC) – The Strategic Perspective; and FAMGA as Venture Capitalists (VC) – The Financial Perspective


Looking at FAMGA’s ventures, it becomes even more evident that these companies are making many bets, likely both out of a strategic motivation as well as a pure financial motivation. FAMGA and all their investment vessels have taken a share in close to 2.300 ventures since 1995.

There have been 140 venture investments/participations in unicorns by FAMGA (startups with a valuation above $1bn), some resulting in acquisitions. Interestingly, quite often, more than one FAMGA is involved in the same venture. VC insiders claim that companies making minority investments in other companies makes no sense, and these types of investments are equal to future call options or outsourced R&D.

Among FAMGA’s unicorn bets are companies like Uber, Lyft, Airbnb, SpaceX, Waymo, Slack, WhatsApp, Lending Club, 23andME, SolarCity, Glassdoor, Waze and Turo. Some have already been converted to acquisitions. But it is fair to say that FAMGA is making a lot of bets and buying a lot of tickets—and many of them will be a large part of our lives, while producing valuable data for the companies.

three takeaways

  1. Don’t just do ventures for access (to hubs like Silicon Valley) without knowing why and how.
  2. In a VUCA world where almost everything is redefined, ventures can be a hedging tool in case pivots are inevitable.
  3. The total spending on CF, legal and other advisory services must be through the roof, or perhaps there is just a lot of trust in the syndicated partnerships between pure VC’s (Sand Hill Road) and FAMGA?

Download the white paper to get the full analysis, more takeaways and a question that all leaders should be asking themselves.

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