Bending Spoons is a company that acquires SaaS companies/products that are not growing or losing users but have a well-known brand and customers who stick around.
The execs at Bending Spoon buy these SaaS services on the cheap, cut costs, jack up prices, and milk remaining users for as much cash as possible for as long as possible.
Rinse and repeat. The goal is to generate the highest possible rate of return on invested capital in a law-abiding manner.
> There are four stages to any successful companies lifecycle
I usually say in interviews that my preferred time to join a company is at the end of stage 1 (start up) and the start of phase 2 (organizing).
Nothing makes me happier than to be told "Hey, we got this up and running and it's a mess. Now we need someone to turn this into a system that is easy to modify and maintain."
Similar story here. They took my ~$100/yr Harvest time-tracking Solo plan, increased the price by 2.5x for a more restricted plan than I had... or I could get back the plan I had for $20,000/year.
So I downloaded my data, and had Claude vibecode a fully-featured clone in a single evening. Even if I was paying Anthropic API rates, it cost me less than a single year of my Solo plan.
Was also on Harvest when news broke they had bought them here on HN. A lot of the same comments. I thought, "Well, maybe this is hyperbole, let's wait it out." About a month after they were acquired, same thing. Price of my plan went up almost by double.
So if anybody is reading this? They absolutely will gouge you. All the stories you've read are all true. Take some advice and get out while you can.
> After the acquisition, Bending Spoons is anything but a passive owner, making changes to the products’ user experience and features, as well as to the underlying tech; monetization strategy, including pricing; and team organization, including headcount.
> While this focus on efficiency and revenue overlaps with private equity strategies, Bending Spoons claims a key difference: It “aims to hold forever, and has never sold an acquired business.” It is building a live portfolio, not presiding over a tech graveyard.
I don’t feel like the article was sortballing the company. They brought up things like the WeTransfer founder criticizing Bending Spoons’ decisions.
As for my opinion on the company, I don’t really see anything particularly negative about it. I think the fact that they’ve never sold an acquired business is a rather admirable trait.
In a way, they’re doing something that may not have been possible without this style of intervention, which is to keep companies/products that would have otherwise disappeared viable.
For a company like Evernote it wouldn’t be better for their customers if the company liquidated. There are worse things that can happen to your service provider of choice than price increases or worse customer support.
People are framing this like they're creating sustainable businesses, but if you look into the details, what they're consistently doing is stagnating on any kind of feature development, making the apps and sites more difficult to use and have more nags, and they're increasing prices, sometimes by 10x or 100x. When I look for a company that I think I would admire, I'm looking for customers that are satisfied and recommend the product to their friends.
Charging $20,000 for a note-taking app subscription is not that.
There’s no choice here, and often the companies are profitable, but if there is any stickiness to the product the customer gets the privilege of having a company they built trust with turn around and betray them with massively increased fees.
I'd argue it's worse for consumers, by keeping them alive it staves off competition, and leeches cash by increasing subscription prices or locking once free feature behind paywalls.
That's a short term business model if I have ever seen one.
"customers who stick around." is anthesis to mid- to long-term customer loyalty when you do "jack up prices, and milk remaining users for as much cash as possible"
Add to this that they make it really, really hard to unsubscribe. I think there's been some legal crackdowns, but for a time, they could make it literally impossible.
This article is like an advertisement. Here's how they spin it:
> Speaking to TechCrunch, co-founder and chief product officer Matteo Danieli said some of the scrutiny was due to the fact that products such as Evernote were genuinely loved by their users. But he said that despite all the changes, customer retention has been “remarkably stable.”
Ah yes. In other news, the prison population size is also remarkably stable.
Bending Spoons are the miserable tossers who bought Meetup and somehow made it worse by monetising every move you make. And it was pretty bad to start with.
My wife brought them to my attention recently because she heard about them from Scott Galloway, who was speaking highly of Bending Spoons on one of his podcasts. As she was explaining this to me, I said "It's just PE."
They must be doing some good PR/marketing, because, for some reason, "PE" isn't the first thing entering a lot of minds about Bending Spoons right now.
Not really. They dramatically overhaul the products. Bloated staff are cut, old tech-debt-saddled systems are thrown out and rewritten. In some cases they basically just keep the brand and the database and rebuild the product around that, in a smaller and leaner manner.
BendingSpoon isn't PE because they are not attempting a restructure to then exit out of the asset within a defined time period.
When BendingSpoon or IAC acquired an asset, it's meant to be held by them in order to augment their existing portfolio.
M&A isn't the hallmark of PE - restructuring an asset in order to exit out of it at a profit is.
The classic PE monetization strategy is to acquire an underperforming asset, restructure said asset, and then exit the asset at around 20% IRR.
BendingSpoons on the other hand is a holding company that is acquiring and consolidating stagnant but large SaaS platforms into a single mega-platform.
The economics are different as are the operational and organizational structures.
The classic PE strategy is to buy declining buy well known brands, borrow vast sums of money in the brands name, pay the PE firm huge consulting fees, and then bankrupt the acquired business.
Which isn't exactly what they seem to be doing but also isn't that far off.
Scotts point was that these brands have already declined, and that the only thing left is a very strongly loyal subscription base. That perked my ears up for sure.
Isn't it just a different form of private capital designed for the later stage of a tech company? I'm not saying its good, but I am not remotely surprised by tech's transition from growth/disruption/hiring to cost-cutting/M&A.
It is. They are also enshittifying Komoot and EventBrite. Also by default they acquire a company and fire all staff within the week. Fuck Bending Spoons.
Pre-bending spoons Komoot was a beautiful app and community.
You could operate it one handed with your brightness turned all the way down and easily get the info you needed.
Now when I pull it up mid ride to route home I have to click through multiple upgrade to premium pop ups with tiny exit crosses.
All good things etc etc
Founders decide they want to do other things with their lives all the time, and in the case of komoot reportedly exited at a €300m valuation for a company that had raised very little VC money, which is going to tempt most people no matter how much they hate popups...
is firing staff after acquisition inherently bad if it's the same staff/management that led to the app being devalued and losing users in the first place though
Labels literally negotiated their own royalty rates down in exchange for shares in Spotify. It’s the perfect way to push artists out of receiving earnings.
I think record labels would be first in line to buy Spotify if it was ever for sale.
Why do you think that a platform with so many customers as to be industry defining, with dozens of interface options, with a massive feature set, with a global footprint and basically flawless uptime requirements, could be kept running by two guys?
Whatever they are, they let Evernote devolve into a buggy pile of crap -- especially on Android. I migrated to Joplin, stopped paying for my obscenely expensive plan ($$$ per year) and haven't looked back.
I was reading a bit about their story, it feels like they managed to succeed by turning overly funded (and by then devalued) software products and restructuring them for long term profitability as they are not bounded to the classic 10 year time horizon of private funds. Wondering if we will see more plays like this as alternatives to traditional private equity and as fallback option for VC backed companies that bursted.
From the acquisitions I've followed, what they do is firing 80% of the staff the next week after the acquisition, raise prices, and put the app in maintenance mode. I don't know if they've done something more sensible elsewhere, but they mostly do wealth extraction.
They do claim to be shipping new features to their acquired apps. Look at their website. It's got lists of such things.
The steelman case for this is something like, mature apps that found product market fit are often over-staffed and doing a lot of duplicated work. You could get five of them together and consolidate their infrastructure/code to reduce costs, and have generalist devs who can work on any of those codebases. Then you need fewer people.
So this isn't an irrational thing to do. It's commonly done by firms like Google or Meta where they buy a small company and then rewrite it onto their own infrastructure to reduce costs. Sometimes the engineers are reallocated to other projects, or things drift and there are eventually layoffs. Google bought DoubleClick and then laid off 50% of the staff! Twitter didn't consolidate products but was clearly overstaffed, nobody imagines that Twitter was unique.
So the bull case for this is that it's finding efficiencies. The apps may not be the shiniest hottest things anymore, but they can still live on and be maintained if they're run more efficiently as a business. And yes this may involve layoffs or price rises, as often software startups hopelessly misprice their product and prefer to burn VC money than lose users or colleagues. Managers who aren't emotionally attached to the product or company can correct this, putting it on a long term stable path. That may suck for the user but probably sucks less than the company being under, or being acquihired and the product totally shut down.
While I agree that their specific approach sucks, I do wish more companies would declare products as "done" and stop messing with the UI and changing features every quarter, and just go into a long-term stability mode.
Are there any companies/products that got better after acquisition by these guys? I feel like the only times I've heard about them is when people are griping about how they're making stuff worse.
They keep popular but unprofitable products that would otherwise be turned down alive.
There are Victorian-horror-esque costs to that, but it's still better that those projects be alive but enshittified than completely dead (If you disagree, you can just cancel your subscription, after all)
Whenever I see Vimeo in a headline, it reminds me of my lack of foresight. In college, the creator of Vimeo was in my friend group. I went to his on-campus apartment to pick him up for a party once. He showed me this "video sharing website" that he was working on. Its title was an anagram of "movie." This was in 1999. Digitized video was barely a thing. I looked at it, didn't understand how it would be useful, and assumed it was another one of his eccentric creative outlets that would go nowhere. A few years later, he was a multimillionaire and I was not.