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Turning Down Billions: Grading 15 Tech Companies that Declined Big Takeover Offers

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Turning Down Billions: Grading 15 Tech Companies that Declined Big Takeover Offers

Turning Down Billions: Grading 15 Tech Companies that Declined Big Takeover Offers

If you were to ask legendary investor Peter Thiel about the most important moment in Facebook history, he would point to an exchange in July 2006.

Yahoo had made the lucrative offer of $1 billion for Facebook, and Peter Thiel as well as board member Jim Breyer got called into a meeting about the deal with Mark Zuckerberg.

“Both Breyer and myself on balance thought we probably should take the money,” recalls Thiel. “But Zuckerberg started the meeting like, ‘This is kind of a formality, just a quick board meeting, it shouldn’t take more than 10 minutes. We’re obviously not going to sell here’.”

Thiel and Breyer thought Facebook should take the money. Zuckerberg, who was 22 years old at the time, had so much conviction that Yahoo did not understand the value of the company, that he dismissed the meeting as just a formality. Thiel and Breyer eventually backed Zuckerberg based on this, and the decision paid giant dividends.

Facebook’s market capitalization is now $288 billion, or 288x the amount offered by Yahoo in 2006.

Today’s infographic recalls 15 offers to emerging tech companies that were declined. Then, looking back in retrospect, it shows whether the deal was a “win” or a “fail” based on the current value of the company.

Original graphic by: Empire Flippers

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Charting the Next Generation of Internet

In this graphic, Visual Capitalist has partnered with MSCI to explore the potential of satellite internet as the next generation of internet innovation.

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Teaser image of a bubble chart showing the large addressable market of satellite internet.

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The following content is sponsored by MSCI

Could Tomorrow’s Internet be Streamed from Space?

In 2023, 2.6 billion people could not access the internet. Today, companies worldwide are looking to innovative technology to ensure more people are online at the speed of today’s technology. 

Could satellite internet provide the solution?  

In collaboration with MSCI, we embarked on a journey to explore whether tomorrow’s internet could be streamed from space. 

Satellite Internet’s Potential Customer Base

Millions of people live in rural communities or mobile homes, and many spend much of their lives at sea or have no fixed abode. So, they cannot access the internet simply because the technology is unavailable. 

Satellite internet gives these communities access to the internet without requiring a fixed location. Consequently, the volume of people who could get online using satellite internet is significant:

AreaPotential Subscribers
Households Without Internet Access600,000,000
RVs 11,000,000
Recreational Boats8,500,000
Ships100,000
Commercial Aircraft25,000

Advances in Satellite Technology

Satellite internet is not a new concept. However, it has only recently been that roadblocks around cost and long turnaround times have been overcome.

NASA’s space shuttle, until it was retired in 2011, was the only reusable means of transporting crew and cargo into orbit. It cost over $1.5 billion and took an average of 252 days to launch and refurbish. 

In stark contrast, SpaceX’s Falcon 9 can now launch objects into orbit and maintain them at a fraction of the time and cost, less than 1% of the space shuttle’s cost.

Average Rocket Turnaround TimeAverage Launch/Refurbishment Cost
Falcon 9*21 days< $1,000,000
Space Shuttle252 days$1,500,000,000 (approximately)

Satellites are now deployed 300 miles in low Earth orbit (LEO) rather than 22,000 miles above Earth in Geostationary Orbit (GEO), previously the typical satellite deployment altitude.

What this means for the consumer is that satellite internet streamed from LEO has a latency of 40 ms, which is an optimal internet connection. Especially when compared to the 700 ms stream latency experienced with satellite internet streamed from GEO. 

What Would it Take to Build a Satellite Internet?

SpaceX, the private company that operates Starlink, currently has 4,500 satellites. However, the company believes it will require 10 times this number to provide comprehensive satellite internet coverage.

Charting the number of active satellites reveals that, despite the increasing number of active satellites, many more must be launched to create a comprehensive satellite internet. 

YearNumber of Active Satellites
20226,905
20214,800
20203,256
20192,272
20182,027
20171,778
20161,462
20151,364
20141,262
20131,187

Next-Generation Internet Innovation

Innovation is at the heart of the internet’s next generation, and the MSCI Next Generation Innovation Index exposes investors to companies that can take advantage of potentially disruptive technologies like satellite internet. 

You can gain exposure to companies advancing access to the internet with four indexes: 

  • MSCI ACWI IMI Next Generation Internet Innovation Index
  • MSCI World IMI Next Generation Internet Innovation 30 Index
  • MSCI China All Shares IMI Next Generation Internet Innovation Index
  • MSCI China A Onshore IMI Next Generation Internet Innovation Index

MSCI thematic indexes are objective, rules-based, and regularly updated to focus on specific emerging trends that could evolve.

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Click here to explore the MSCI thematic indexes

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