AngelList, the platform that lets people hunt for jobs and create connections within the startup ecosystem, has acquired Product Hunt. The acquisition has been officially announced although the financial details of the transaction have not been disclosed yet.
In case you are unaware of it, Product Hunt is a platform that allows people to vote on startup Products, letting everyone have a general idea of how they are going to do once launched in the market. Considering the niches they operated in, AngelList and Product Hunt sort of belonged together and to me, this acquisition is one of the most suitable ones of 2016.
The acquisition is kind of unexpected though. Product Hunt was said to be looking to raise its next round, however, it appears to have decided that coming on-board with AngelList would give it the best prospects.
The companies already had an association of sorts. AngelList’s Naval Ravikant had previously invested in Product Hunt and as such, was familiar with the platform and was probably very confident before he made this acquisition. Product Hunt apparently was also concerned about the chances of AngelList moving into its niche — an all too possible prospect considering the latter’s reach into the startup ecosystem.
And of course, AngelList had similar fears. Product Hunt is pretty popular in its own right and could have easily turned into a fundraising platform for startups. Considering that both the companies were already associated, theuy decided to put these fears to rest by joining forces.
Speaking to TechCrunch, Product Hunt founder Ryan Hoover said,
This was super important in taking that next step. We had to look at Naval and his team and say ‘are they just going to acquire us and shut us down?’ for instance…but Naval made it very, very clear that he invested personally in what we’re doing because he believes in our vision for the future.
He also added that,
Several millions of people work in tech and tech is something that affects all of our lives. But now in this new AngelList and Product Hunt collaboration, in this new world, it’s actually an opportunity to help the tech industry but it still doesn’t sacrifice our mission or our vision of becoming even bigger.
Meanwhile, Hoover will continue running Product Hunt as CEO. He along with his team, will be moving into AngelList’s headquarters in San Francisco’s financial district. There are a lot of potential ways that these companies could work together and compliment each other. AngelList for example, now has almost everything — including information, jobs and now product — that you could want while having a startup in your line of sight.
Product Hunt will probably push ahead with monetization and growth, although the latter may occupy be a bigger space on the horizon now. At present, it derives most of its revenue by making it easier for people to buy the products they are looking at on its platform and taking a small cut fro the proceeds. However, Hoover was heard saying that his company would unveil its first significant revenue-generating source in 2017’s first quarter. Let’s see if Product Hunt decides to stick to its schedule. It will be very interesting to see how the company plans to generate revenue and if the plan involves AngelList as well.