It’s typically much quicker to acquire rather than build your own solution, especially when that technological solution is already superior and being used in the marketplace. When looking at large tech companies like Google, Amazon, and Facebook, they could be acquiring tech startups for a number of reasons:

1. Talented employees - Often you’ll see the engineering team being folded into the the firm’s existing divisions.
2. Stamp out the competition - Not only will the buyer prevent the startup from drawing away its own customers, an acquisition also prevents a larger competitor from purchasing the startup.
3. Instantaneously gain access to new technology - As Patrick Cusack noted below, knowledge is power and an acquisition allow the buyer to gain it immediately.
4. Rapidly gain marketshare - Facebook purchased Instagram in a large part to gain access to its growing user base. Facebook’s audience at the time was declining so they turned to Instagram.
5. Pick a winner - The first tech solution to market isn’t always the winner. Think about Betamax vs. VHS. VHS became the dominant player. Think about MySpace, which came out earlier than Facebook, losing out to other social networking sites. Acquiring let’s you pick the winning technology.