Google might buy what it can’t build

Google parent Alphabet is considering a bid for $34 billion marketing software solutions platform, according to Reuters. Why would Alphabet want to acquire Hubspot? And, related, what actually is Hubspot?

Hubspot is one of several publicly traded multi-billion dollar software as a service (SaaS)  companies that no one really knows what it does. Think: Atlassian, ServiceNow, or Workday. But its business is straightforward: Hubspot offers sales and marketing teams user-friendly dashboards for creating, tracking, and updating their leads. This data is compiled in a single central database, instead of being siloed in team-specific databases, improving transparency and information continuity across an enterprise, and their dashboards integrate with thousands of third-party apps. TL;DR: Hubspot is a solution for managing a company’s sales and marketing departments.

Why would Alphabet want to acquire Hubspot? Well, they’re infamous for launching, and then shutting down, various projects. A few examples: Google Domains, Google Currents (which was the rebranded version of Google+), Google Jamboard, Google Cloud IoT Core, Google Hangouts, Google Surveys, G Suite, and Google Go Links. For those curious, you can see the full list of Google’s graveyard at killedbygoogle.com.

What Alphabet does have, however, is near-infinite consumer data, a dominant portion of the search market, and a powerful advertising business. Combining Hubspot’s marketing and lead generation solutions with Google’s search and ad capabilities could be valuable for sales and marketing teams, depending on how they are integrated.

If Alphabet makes a formal offer, however, it will almost certainly be flagged by regulators. FTC Chair Lina Khan has been cracking down on big tech M&A since taking over, and the world’s biggest search provider acquiring a $34 billion B2B marketing solution fits the template for deals she would sue to block.