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DailyTidings.com
  • California tech companies branch into the Northwest

    'Acqui-hires' give way to more permanent 'Silicon Forest' outposts
  • PORTLAND — It's another funky Portland startup, right?
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  • PORTLAND — It's another funky Portland startup, right?
    Actually, this is eBay.
    The online marketplace and auctioneer has gone almost unnoticed as it quietly built one of the Silicon Forest's largest mobile software operations in the heart of downtown.
    Based in San Jose, Calif., eBay came to town two years ago when it acquired a venerable Portland mobile developer called Critical Path Software. It's one of a handful of big technology companies that have bought into Oregon in the past two years, seeking people rather than products.
    "Talent acquisitions," sometimes called "acqui-hires," are a way of life in the Silicon Valley, where the competition for skilled software engineers is so fierce that sometimes the best way to acquire a skilled team is to buy a whole company.
    It's a relatively new phenomenon in the Silicon Forest, though. Historically, tech companies here have been sold for parts and dismantled when they pass their prime.
    Now, a takeover is just as likely to mean fresh investment and fresh opportunities. Google, Dell and Walmart Labs all established Portland offices through similar deals.
    Instead of stripping the Portland office, eBay has doubled down. It's added dozens of employees since buying Critical Path in 2010 and lists another 19 Portland jobs on its website. It's set to occupy a third floor of its building near Portland State University, increasing its office space by 50 percent to make room for more software developers.
    "We want the renaissance engineers out there, the guys that see the big picture," said Kevin Hurst, who worked at Oregon tech companies InFocus, Extensis, Digimarc and Ensequence before joining eBay last year as vice president of mobile products.
    Yes, Critical Path alumni acknowledge, something is lost when you sell. But joining an $11 billion company gives them a reach they never had on their own.
    "The ability to get something in front of 100 million eyes is amazing," said Steve Romero, who co-founded Critical Path in 1991 and ran it for nearly two decades. Now, he's an eBay VP. The Portland office is in charge of eBay's mobile software development, building apps and websites tailored for smartphones and iPads.
    That's the company's fastest-growing audience — eBay forecasts that mobile transactions this year will be 17 times what they were just three years ago.
    The Portland office, which employed "dozens" when eBay bought it in 2010 (the company won't say just how many), has doubled in size and lists another 19 open positions on its website.
    Critical Path had developed a "mutual dependence" with its largest client, and a deal to bring them together gradually became to feel inevitable, Romero said — at least to him.
    For some employees, he said, it was still a shock.
    "I think they were a little bit apprehensive initially because one of the things we used to do as a company was develop software for large organizations because they seemed no longer to be able to do it for themselves," Romero said.
    When eBay leased larger digs to make room for its Portland expansion, the company agreed to let its new employees design an office that reflected Critical Path's culture, and its community.
    Even the old Critical Path name remains prominently displayed alongside eBay on walls around the office.
    "It was a really important component, initially at acquisition, to keep that," Romero said.
    Oregon tech companies have a long history of selling out. That's sometimes created an enduring outpost, like the one IBM established when it bought Sequent Computer Systems in 1999.
    More often, though, the buyouts come when the Silicon Forest company was on the ropes. Buyers act as vultures, picking at the bones.
    Remember GST Telecommunications? Probably not. Time Warner Telecom dismembered the struggling Vancouver company. Beaverton became an afterthought when a Massachusetts company called Kronos bought Unicru in 2006.
    And Hewlett-Packard Co. closed PolyServe's Beaverton office after buying that company in 2007.
    More recent acquisitions by eBay, Google, Dell and others reflect Oregon's maturing tech ecosystem, according to Skip Newberry, president of the Technology Association of Oregon.
    "They're providing a measure of stability and an influx of resources that allow these companies to stabilize, if necessary, and also achieve some sustained growth," said Newberry, former economic policy adviser to Portland Mayor Sam Adams.
    Startups are sexy, with the promise of an enormous payoff for the few who hit it big. But far more flame out, or stall out. Newberry said that blue-chip tech companies provide an alternative to skilled employees seeking stability rather than adventure.
    And they provide a measure of credibility to a state with relatively few household names in its tech ecosystem.
    "It's kind of nice to have the visibility that even an outpost office offers," Newberry said.
    At Critical Path, Romero said, the mission statement was simple: "Is it good for you? Is it good for the company? Is it legal?' Then do it."
    Sometimes, Romero said, he's wistful for that adventure and independence. Working for eBay comes with all the policies, procedures and regulations that come with working at a massive, publicly traded company.
    It also brings more resources, and the opportunities to take imaginative flights into products — eBay's mobile suite includes fashion apps, an app that finds parts for your car, and an iPad app that finds merchandise from the show you're watching.
    "The shift to the big company perspective has been challenging," Romero said. "But it's been good."
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