The Arrogance of Turning Down $100 MillionS

Sometimes making a fortune is dumb, writes entrepreneur Charlie O'Donnell—which is why, O'Donnell adds, Foursquare will wisely walk away from a rumored $100 million offer from Yahoo. It's the sort of cocky move pioneered by companies like Twitter.

The idea that an annoying, unprofitable social network like Foursquare would turn down $100 million, a not-so-small fortune, is inspired in part by Twitter's 2008 rejection of a $500 million offer from Facebook. Twitter had no revenue at the time, but the microblogging service thought it was on the verge of becoming a veritable gold mine. Facebook, in turn, rejected a $900 million bid from Yahoo for similar reasons. Both startups may well prove themselves prescient, but their arrogance shouldn't be copied: Even for a hot startup-of-the-moment like Foursquare, it's usually best to take the money and run.

[Photo: Laughing Squid's pic of Foursquare CEO Dennis Crowley who, to be fair, may not have turned down anything yet.]