Twitter-Summize a classic hire-acquire deal

Twitter has bought Summize, a search engine which indexes Twitter messages. It's hard to imagine Summize going anywhere else. But this deal is not about "strategic fit" or any such nonsense. No, it's about how the cleverly lazy founders of Twitter have found a way around the biggest management headache of all: Hiring employees. Twitter's substantial downtime, and a subsequent blame game about whether former architect Blaine Cook was at fault, shows how often technological problems come down to people. We actually don't think Cook made bad technical decisions — but it's now pretty clear that he was more interested in moving on than staying at Twitter and arguing with founder Ev Williams about how to fix the site. At $15 million, Summize might actually be a cheaper solution than trying to hire a conventional replacement for Cook.

Five out of six Summize employees — all engineers — are joining Twitter. They proved their mettle by helping Twitter stay online during the announcement of Apple's iPhone — the kind of technological epiphany that sends Twitter users into a frenzy.

Sure, Twitter could have hired the likes of Summize CTO Greg Pass. But the tools of traditional recruitment — resumes, references, interviews — are time-consuming and mostly useless. And it's difficult to reward employees adequately, even with pre-IPO stock options. Do you really think a director-level Twitter employee would get the equivalent of $3 million in salary and stock? By buying a startup, and taking in its employees, a company can dole out outsized — but well-deserved — stock rewards, and skip a lot of HR rigmarole.


Cisco has long pulled this maneuver, buying promising networking companies and then pumping their products through a readymade sales force. At Google, employees are now muttering about how the only way to get rich is to leave the company, form a startup, and get bought by their ex-employer. That Twitter's pulling such a sophisticated trick at such a young age shows that Williams is even cleverer than we thought.