How To Thrive After a Takeover
VICTOR TSAO, co-founder, Linksys
By Matthew Maier

(Business 2.0) – Last March, Cisco bought your home-networking-hardware startup for $500 million. While that's usually the end of the story for a tiny startup, the Linksys brand has taken off since the acquisition, expanding into new products. How have you maintained the Linksys identity within Cisco?

We had a lot of planning meetings before the acquisition. The main question, because of the differences in our business models and target markets—consumer vs. enterprise—was, How do we make it work? We decided that we had to remain separate, and we still religiously try to keep it that way. We have our own engineers, our own sales and marketing teams, our own accounting department. We've even maintained our headquarters in Southern California. When we launched a VOIP adapter with Vonage, we were able to sell our own VOIP routers.

As far as the cultural differences, well, the day we announced that Cisco was buying us, a lot of the employees were pretty sad—worried about the company's future and their own. To be honest, there's no such thing as perfect integration; there was definitely a three- to six-month learning curve we all had to endure. We also had to get used to being a part of a big public company. In the past we would just make a decision and then send out an e-mail to let people know about it. So we had to learn how to say, "Hold on a second." That was huge for us—learning how to slow down. — M.M.