Bending Spoons is a company that acquires SaaS companies/products that are not growing or losing users but have a well-known brand and customers who stick around.
The execs at Bending Spoon buy these SaaS services on the cheap, cut costs, jack up prices, and milk remaining users for as much cash as possible for as long as possible.
Rinse and repeat. The goal is to generate the highest possible rate of return on invested capital in a law-abiding manner.
> After the acquisition, Bending Spoons is anything but a passive owner, making changes to the products’ user experience and features, as well as to the underlying tech; monetization strategy, including pricing; and team organization, including headcount.
> While this focus on efficiency and revenue overlaps with private equity strategies, Bending Spoons claims a key difference: It “aims to hold forever, and has never sold an acquired business.” It is building a live portfolio, not presiding over a tech graveyard.
I don’t feel like the article was sortballing the company. They brought up things like the WeTransfer founder criticizing Bending Spoons’ decisions.
As for my opinion on the company, I don’t really see anything particularly negative about it. I think the fact that they’ve never sold an acquired business is a rather admirable trait.
In a way, they’re doing something that may not have been possible without this style of intervention, which is to keep companies/products that would have otherwise disappeared viable.
For a company like Evernote it wouldn’t be better for their customers if the company liquidated. There are worse things that can happen to your service provider of choice than price increases or worse customer support.
People are framing this like they're creating sustainable businesses, but if you look into the details, what they're consistently doing is stagnating on any kind of feature development, making the apps and sites more difficult to use and have more nags, and they're increasing prices, sometimes by 10x or 100x. When I look for a company that I think I would admire, I'm looking for customers that are satisfied and recommend the product to their friends.
Charging $20,000 for a note-taking app subscription is not that.
I don't know about their other software, but i'm a (paying) user of komoot. Komoot development has stagnated until bending spoons took over ~1y ago, see the recent https://www.komoot.com/product-updates
maybe it's case by case basis; i'm not an evernote user since the botched rewrite probably 10y ago at this point
I certainly don’t find any of that positive, either, but sometimes what a lot of these companies need to survive is to increase prices and only worry about the feelings of the customers who find those higher prices to be worth it.
The $20,000 price plan wasn’t a real price, that was just a not so gentle nudge to move to a different offering. Maybe it feels bad but that plan effectively doesn’t exist anymore. Things change.
It’s got fewer features for the dollar, but if the previous company was not sustainable in the first place, it is what it is.
A company raising prices or cutting service quality is only a problem if they’re in a monopoly situation with no other market alternatives. None of the companies Bending Spoons has acquired are in that position. Many of them are far from being the market leaders.
The point is that Bending Spoons isn’t buying companies and saddling them with unsustainable debt like they’re Toys R Us. They’re buying companies that need drastic operating change and implementing that change so that they can exist in perpetuity.
This is true, but there are choices you can make in life to really minimize the impact. I've been using TiddlyWiki for more than 20 years and it always Just Works. I picked it precisely because I value endurance in the software I choose. I know that's not a fad right now, but folks just don't have to subject themselves to this standard of treatment.
That aside, my objection is the use of shady tactics to achieve that goal (constant nags and popups, massive price increases for reduced service, rejection of previously "lifetime" memberships, etc.), at the expense of the customer. Swaddling that in a blanket of "it's sustainable" makes me feel only a tiny bit better about it. To make an extreme comparison: fraud is also sustainable; I guess I'm saying sustainability is not an inherent good. If (hypothetically) every Evernote customer would be better off if they were using Joplin, keeping Evernote around would be a bug, not a feature. I don't think this is actually true, might it might be close.
I think that every time an option leaves a market it’s a detriment to competition. It doesn’t really matter if that option was bad or that I won’t personally choose it.
I’m certainly very much against lifetime subscriptions losing promised features and things like that.
I will add to my original reply, if I drink their company kool aid on their company website they pretty specifically list out a number of improvements they’ve made to their product portfolio.
They have claims like making Evernote sync faster, fixing stuck transfers on WeTransfer, offering a free organizer EventBrite account for the first time since 2005. These seem like pretty tangible claims.
Perhaps they are trying to combat this exact negative image that they’re just there to suck out value.
Maybe they’re lying about their accomplishments, I really don’t know. I don’t use any of their products.
Yep, I ended up looking into this quite a bit more, and now agree with you. Evernote ratings were historically lower before the Bending Spoons acquisition. There are shady things you can do with ratings like ask whether they like they app before redirecting them to the rate it, it does seem like I was over-indexing on some anecdotes (I also worked with some ex-Evernoters, so I was coming in a bit biased). Thanks for pointing out the trend!
> There are four stages to any successful companies lifecycle
I usually say in interviews that my preferred time to join a company is at the end of stage 1 (start up) and the start of phase 2 (organizing).
Nothing makes me happier than to be told "Hey, we got this up and running and it's a mess. Now we need someone to turn this into a system that is easy to modify and maintain."
There's skill in being able to manage a declining or non-growth business in a way that still pleases your consumer base (and therefore reduces your attrition rate). Not everyone does it well.
There's nothing wrong with it per se. Plenty of great products were ruined because management refused to accept that it wasn't in a growth market anymore and should be run for minimising customer losses, not gaining substantial new ones. That, in turn, means laying off a lot of the design, engineering and sales talent that was necessary for the previous configuration.
You can also be a bastard and jack up prices while cutting e.g. customer service. (Though absent new major revisions, service costs should go down.) But I'd argue we need, in tech, more of this strategy of calm wind-down than the everything-must-be-growth mindset.
Similar story here. They took my ~$100/yr Harvest time-tracking Solo plan, increased the price by 2.5x for a more restricted plan than I had... or I could get back the plan I had for $20,000/year.
So I downloaded my data, and had Claude vibecode a fully-featured clone in a single evening. Even if I was paying Anthropic API rates, it cost me less than a single year of my Solo plan.
Was also on Harvest when news broke they had bought them here on HN. A lot of the same comments. I thought, "Well, maybe this is hyperbole, let's wait it out." About a month after they were acquired, same thing. Price of my plan went up almost by double.
So if anybody is reading this? They absolutely will gouge you. All the stories you've read are all true. Take some advice and get out while you can.
eh, i backed up in a few places a bit ago. the actual concern is BS charged me when they shouldn't have (5x the former price, annual), won't refund, and turned off the account anyway. and PayPal seems to have an open marriage with PCI-DSS/SOC2 right now
That's a short term business model if I have ever seen one.
"customers who stick around." is anthesis to mid- to long-term customer loyalty when you do "jack up prices, and milk remaining users for as much cash as possible"
Add to this that they make it really, really hard to unsubscribe. I think there's been some legal crackdowns, but for a time, they could make it literally impossible.
This article is like an advertisement. Here's how they spin it:
> Speaking to TechCrunch, co-founder and chief product officer Matteo Danieli said some of the scrutiny was due to the fact that products such as Evernote were genuinely loved by their users. But he said that despite all the changes, customer retention has been “remarkably stable.”
Ah yes. In other news, the prison population size is also remarkably stable.
> Don't forget "slash the workforce, ensuring that the product will get worse over time"
Not commenting on Bending Spoons. But in general, a company built to grow is overprovisioned for one being put into maintenance mode. If you're growing, sure, let the designers change the UI every release. If you're trying not to lose customers, don't do that. Which means you don't need a crack team of in-house designers.
I agree that a company in growth mode needs more employees than one in maintenance mode. But wouldn't the owners already have cut unnecessary employees before selling out to PE or similar?
> wouldn't the owners already have cut unnecessary employees before selling out to PE or similar?
Usually not. It's emotionally difficult. And knowing what you need and don't need to cut (versus transition or aggregate with your conglomerate's administrative layer) is its own expertise. If you had that, you wouldn't need Bending Spoons or whomever.
Yes, it is part of cutting costs, but there are other ways to cut costs ("synergies" from merging back office functions) that don't necessarily affect the product.
There’s no choice here, and often the companies are profitable, but if there is any stickiness to the product the customer gets the privilege of having a company they built trust with turn around and betray them with massively increased fees.
I'd argue it's worse for consumers, by keeping them alive it staves off competition, and leeches cash by increasing subscription prices or locking once free feature behind paywalls.
> The execs at Bending Spoon buy these SaaS services on the cheap, cut costs, jack up prices, and milk remaining users for as much cash as possible for as long as possible.
If they are such stable long term SaaS businesses who aren’t losing customers, why are they selling to bending spoons?
because there's no joy in managing a declining company, especially when you made it grow in the past, and probably get enough money from the deal that you don't need to care anymore.
The execs at Bending Spoon buy these SaaS services on the cheap, cut costs, jack up prices, and milk remaining users for as much cash as possible for as long as possible.
Rinse and repeat. The goal is to generate the highest possible rate of return on invested capital in a law-abiding manner.