Well, as the name implies, there are 40 companies in this list, and some of them, like Cisco, News Corp., and Pfizer may have essentially bought their way onto the list with their acquisitions of smaller, more innovative, companies, as described in Buy It Now. Cisco acquired 107 companies over a 12-year period, including cable-box maker Scientific Atlanta, to become the market force it is today. News Corp. bought MySpace‘s parent company and Pfizer bought biotech firm Vicuron Pharmaceuticals. (Furthermore, eBay bought Skype, Salesforce.com bought Sendia, Google gobbled Dodgeball, Urchin Software, and Upstartle, and Yahoo acquired Konfabulator, Webjay, Upcoming.org, Flickr, and del.icio.us.)
Furthermore, with the IPO market still sagging and the Post-Enron regulations increasing the cost and difficulty of going IPO, many small firms are now playing the acquisition endgame. Companies form with the sole intent of selling to Yahoo, Google, Microsoft, SAP, or SalesForce.com.
It’s essentially mature Crowdsourcing for large-organizations, except the organizations are going after collectives, in the form of small companies, that have already identified and made progress on the problem the large company is encountering instead of individuals. And since Networked Person is slowly taking over today’s knowledge-based economy, with her ability to virtually form new R&D collectives with her wi-fi blackberry transmissions, I think M&A based R&D may be one of the primary forms of innovation in large organizations for some time to come.