What do you do if you're a leading company and there's pesky startup that could be a real threat in the future? You buy it. You give the startup's execs some clout. And you use it as a sales channel in the future.
Add it up and those items justify Intuit's purchase of Mint.com. Intuit said Monday that it will buy Mint.com for $170 million. The moving parts add up for both parties.
- Intuit gets another property that can add to its software as a service portfolio (a diversification effort for its desktop software dominance).
- Intuit neutralizes a rival.
- Mint.com had a nice initial base, but would have hit headwinds from folks that remain skeptical about consolidating accounts with a startup.
- Mint will benefit from the association with Intuit and gain more clout to forge partnerships with financial institutions.
- Intuit absorbs a potential competitor for Quicken Online.
- Intuit gains an executive---Mint.com CEO Aaron Patzer---to infuse some new thinking into its personal finance unit. Patzer becomes general manager of Intuit's personal finance group.
- Intuit gains expertise and perhaps some user interface mojo---assuming Patzer sticks around.
- Intuit gets another channel to upsell its wares. The company says it will keep Quicken Online and Mint.com. That take indicates that Intuit sees both customer bases as distinct. Remember the game may not be to kill Mint.com as much as finding another base of customers that may become future Quickbooks and Turbo Tax users.
You could argue that Intuit paid too much for Mint.com, but strategically the deal makes sense. The next hurdle for Intuit: Keeping Mint.com users in the fold.
ZDNet: It's official: Intuit buys Mint.com; Plans to keep Mint.com and Quicken Online
This post was originally published on Smartplanet.com