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LINDEN RESEARCH, INC. TO BE ACQUIRED


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2 minutes ago, Cinos Field said:

Investment groups are typically parasites that contribute very little while sucking companies dry. I at least will be more careful about spending money on SL until these ones prove they aren't.

Agreed

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Good day, all! Just jumping in to respond to a few of the comments... A few folks are speculating that this is the end of SL and nothing could be further from the truth. Any talk of dismantl

SECOND LIFE IS DEAD

In all seriousness -- this really really is a good thing. We’re excited for the opportunities it presents and we’re rock solid sure of the bright future of SL. And with that… NFC    

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It is pretty disturbing that everything we've ever made can be traded so flippedly. So in a day, our items and our futures can be sold off. Difficult to have any confidence at all that this will be a good thing.

Edited by Medhue Simoni
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Waterfield acquisition philosophy, as addressed to companies wanting to be bought out:

"The Waterfield Private Equity Fund(s) I, II, & III; as well as The Waterfield Family Office, invest in conservatively run companies with strong free cash flow, proven management, and a platform we believe can add value to the global economic community. We prefer basic businesses with a few years of proven, conservative growth. We avoid companies that are growing too fast. We believe slow and steady makes the race. EBITDA has typically been in the $5 to $50mm range. Honest, ethical, hard-working management is a must. We research reputation extensively before we buy. We will pay slightly above market for achiever-oriented cultural strength. By mandate, we are required to purchase 51% or more of the consolidated operation. We strive to be a good partner to existing management, are passive with regards to general managerial issues, and work hard to help our CEOs and their families’ realize their vision. We have no defined exit plan, and tend to own companies for generations. Waterfield has a strong track record of investing in a wide variety of companies. We entertain serious sellers only."

"Waterfield’s investment timeframe is forever. We work to grow book value at a reasonable pace with no exit in mind."

This is quite unusual. This is a company that like dull, boring, and profitable. It's like Berkshire Hathaway in the early years.

Their list of companies is in the link above.

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1 hour ago, CinnamonMousse said:

I'm not surprised, actually. I always figured Ebbe would want to sell Second Life once his beloved Sansar was gone. 

I am hoping that this move is going to give SL the support it needs from its investors/owners to help it grow and thrive. 

Personally, I see this as a good thing. 

It's not Ebbe's to sell. He's not the owner, but the CEO hired to run it by the investors. He may have stock but he may not be consulted on the sale.

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2 minutes ago, Prokofy Neva said:

 

My third thought was: why the emphasis on Tilia, money. licensing etc when it's supposed to be about virtual content creation? Or maybe those are the same thing, essentially.

 

Tilia is the jewel in the crown. It offers a business to business service, it makes money, and it can potentially do it without any need for 'weird porn simulator 2004'

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3 minutes ago, CoffeeDujour said:

 

Tilia is the jewel in the crown. It offers a business to business service, it makes money, and it can potentially do it without any need for 'weird porn simulator 2004'

I don't see how it can be a jewel. The deal is still waiting regulators' approval because they are a money service. But then so is PayPal and much larger and better known and B2B as well. I don't see it. Content creation -- and sale -- is supposed to be the jewel of SL's crown. But as I already said, microcurrency management IS content creation/sale so it's maybe all the same thing.

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Honestly, as much as I love Linden Lab and Second Life, I see this as a horrible, horrible thing, and personally feel that the "This is good news!" from LL is PR to keep residents happy in the meantime (I wouldn't blame them).

Excuse me for being very super skeptical about this, but almost every acquisition I have seen as turned out horrible, and it boils down to the following:

  • They don't know anything about the community and end up royally messing it up.
  • They will find a way to severely upset the community by introducing all sorts of things the community didn't ask for and does not want.
  • Stuff begins getting censored and bleached because parent brand protection(in this case, Waterfield Investments) or because "widening our audience". (I.E. No more adult rated content, less freedom of expression, forcing LL to get ban crazy, etc)
  • They close down what they perceive as not profitable. (I.E. Buying LL for Tilia, closing down Second Life)

The end result: Second Life gets closed because people not involved with the community at all don't know what they are doing and have profits first, community second.

I've seen it before with Tumblr, Nest, Neopets, Geocities, YouTube, etc.

Personally, I think the best thing to do is have these "investors" show they care about the community. Not just "say" they "understand the concerns", but show they mean it. Because right now, I fear for Second Life.

Second Life is really all I have to do because of autism and the mysophobia that came with it that keeps be locked inside all day for months on end. It has given be the ability to live life to an extent and have fun with others in a way that no other online platform would give me. I have invested hundreds of dollars and years of my life into Second Life, I don't want to see that taken away because of people who don't understand the community. I have already had endless things taken from me, I don't want another thing gone as well.

Edited by Chaser Zaks
Lessened the language used
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3 minutes ago, Prokofy Neva said:

I don't see how it can be a jewel. The deal is still waiting regulators' approval because they are a money service. But then so is PayPal and much larger and better known and B2B as well. I don't see it. Content creation -- and sale -- is supposed to be the jewel of SL's crown. But as I already said, microcurrency management IS content creation/sale so it's maybe all the same thing.

This is why price structures were "rebalanced" earlier this year, move more of SL's bottom line onto Tilia.

The value in LL isn't the creativity of its customers and their hobby economy

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Just now, CoffeeDujour said:

This is why price structures were "rebalanced" earlier this year, move more of SL's bottom line onto Tilia.

The value in LL isn't the creativity of its customers and their hobby economy

I realize that you wish to be cynical to appear cool, but seriously, why is Tilia even a thing in a world of not only PayPal but Venmo and everything else? They can handle small amounts of currencies, too. If the value-add is micro-currencies, well, there are plenty of wallet projects including some bought by Facebook but just not implemented because they are a management and regulatory and security chore. They need constant watching. It isn't Tilia that has that experience of watching and implementing, but Tilia. And again, if there's nothing to buy with your microcurrency, it's as useless as Joe's Bitcoin, so content is still at the center.

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I wonder how soon they'll be shutting the grid down forever. That's what usually happens as the result of an "acquisition". It's allowed to run for a few months then BAM! gone for good.

Just when I start thinking things can't get any worse. 😢

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30 minutes ago, CoffeeDujour said:

Tilia is the jewel in the crown. It offers a business to business service, it makes money, and it can potentially do it without any need for 'weird porn simulator 2004'

Tilia's customers are SL, Sansar, and a phone-based game called  "Upland".  Major game companies are not signing up with Tilia to outsource their game token processing. However, Waterfield might be able to do more with Tilia; they own some banks, and can get Tilia properly connected to the financial system. They don't need to fool around with PayPal and Skrill; they can go direct to a bank and get rid of a layer of intermediaries.

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1 hour ago, animats said:

Because the primary investors in LL were venture capital funds. They don't hold ownership forever. They have to exit at some point.

I don't know how non-public companies work. Does the acquisition get the VCs out of the picture entirely? And sweep the board clean, finally? (If so, honestly, this is bound to be a win.)

One does kinda wonder how the deal got made. We know who bought, but who was doing the selling?

In any case, FFS, it's not as if Linden Lab is a non-profit. It makes money and the buyers want something that's pandemic-proof. I mean, looking at the current US coronavirus statistics, Linden Research Inc looks like a fine investment to me.

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2 minutes ago, animats said:

They don't need to fool around with PayPal and Skrill; they can go direct to a bank and get rid of a layer of intermediaries.

No thank you! I avoid dealing with banks as much as possible.

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2 minutes ago, Qie Niangao said:

One does kinda wonder how the deal got made. We know who bought, but who was doing the selling?

Globespan Capital Partners was the largest investor in Linden Lab.

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I've worked for several companies that got taken over by investment companies.  What happens next falls into two categories depending on the path that the investment company follows.

1: Things run smoothly for a year or so, then the investment company starts asset stripping piece by piece.  Not all at once (usually) but small pieces of the pie are stripped out and moved on to other companies they own.  Before anyone knows it, whats left is an empty shell, the user base then collectively leaves, and that empty shell is closed, or then, ultimately sold off to another buyer.  While that is going on, and about halfway through their plan, prices start to creep up, or new ways to milk the customer for money is brought in.  They intend to get as much cash as they can while the asset stripping is going on to at least get some kind of return on the initial investment before the sell off starts.

2: The investment company...invests.  They take a loss on the initial purchase, a loss on the initial investment but have a road plan to regain that investment back in 2 to 5 years.  They hire in new staff to oversee and overhaul of the internal company structure, they hire in new I.T and new Dev's to oversee and undertake a complete and total independent and impartial inventory of the underlying structure of the company.  They then target the weak points, or points which may in the future stop or slow down income stream...and they throw money and people at it to fix the problem.  It is a long multistage plan, with the eventuality of the plan of making the company they invested into more profitable either by sheer growth of the user base, or an internal and external restructuring of the company and the services that company provides.  THIS is the kind of investment company we can hope has taken over Linden Research, the type of company who are in it for the long haul.

We will find out (probably by the beginning of next year) if the investment company who took over is path 1, or path 2. 

If they are path 1, we will all see it within 6 months as cash grabs as small asset stripping starts to take place.  When you see that start to happen...leave or dramatically scale back.  I know i will.

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3 minutes ago, Vic Mornington said:

If they are path 1, we will all see it within 6 months as cash grabs as small asset stripping starts to take place.  When you see that start to happen...leave or dramatically scale back.  I know i will.

Tilia is the canary.

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