How does Google decide what companies to acquire?

I have negotiated two successful acquisitions of startups by Google as the lead negotiatior and M&A advisor for the seller (Phatbits, Instantiations), and have been involved as in investor and/or board member with several others. read more

The target company needs to fill a critical technology gap in a more efficient, cost-effective and timely way than building the technology, or, the target company has to have the potential of scaling up to Google scale (hundreds of millions + in revenue). read more

The article mentions the most successful as: Android (mobile), YouTube (video), DoubleClick (display advertising), Keyhole (which became Google Earth) and Writely (Google Docs) So the best way to get acquired by Google today is to make something that advances the goals of one the aforementioned business units. read more

Harrison defends the deal as a smart acquisition because of the patent portfolio that Google acquired, helping the company defend itself from lawsuits by Apple and Microsoft (Geis, who has studied the transaction closely, called it “a wash” for Google). read more