Yesterday Yahoo announced the acquisition of New York-based blogging platform Tumblr, a microblogging platform and social networking website. These days deals don’t come cheap – Yahoo is acquiring Tumblr for $1.1 billion, all-cash deal. Sweet! The Founder & CEO David Karp is just 26 years old.
Other famous billion dollar acquisitions – Facebook’s $1 billion for Instagram in 2012 and Microsoft’s $1.2 billion for Yammer.
Tumblr offers tools to make simple blog pages, which anyone with a Web browser can see without signing up with Tumblr. However, you need to login to subscribe to different Tumblogs, which they view on a “dashboard” — the equivalent of Twitter and Facebook’s newsfeeds.
Tumblr could be one of the few startups from New York area that has made it this big. My first serious read about Tumblr (as a company) was in Forbes India magazine.
- Tumblr started in 2007.
- David Karp is a college drop out.
- Karp’s education in the digital world began at the age of 11, by teaching himself how to code from ‘HTML for Dummies’
- Karp will make $250 million from this deal. Plans to use the money for philanthropy and for college (but does he need a degree anymore?)
- The company burned through an estimated $25 million in 2012 and made only $13 million in revenue.
- It set a $100 million revenue target for 2013 but pulled in only $13 million last quarter (Jan-Mar 2013).
- Tumblr is a much more anonymous platform than some of its social networking peers and lacks the demographic information found on Facebook and Instagram
- As of May 19, 2013, Tumblr hosts over 108.2 million blogs and more than 50.8 billion posts in total.
- In April 2013 the website received more than 13 billion global page views.
- As of May 2013, 75.8 million posts were created on the site each day.
- 500 million page views a day
- 15B+ page views month
- ~20 engineers
- The peak rate of ~40k requests per second
- 1+ TB/day into Hadoop cluster
- Many TB/day into MySQL/HBase/Redis/Memcache
- Growing at 30% a month
- ~1000 hardware nodes in production
- Billions of page visits per month per engineer
- Posts are about 50GB a day. Follower list updates are about 2.7 TB a day.
- Dashboard runs at a million writes a second, 50K reads a second, and it is growing
- In its first round of funding in October 2007, Tumblr raised $750,000 from Spark Capital and Union Square Ventures.
- In December 2008, the company raised $4.5 million in Series B funding and a further $5 million in April 2010.
- In December 2010, Tumblr raised $30 million in Series D funding.
- The company had an $800 million valuation in August 2011.
- In September 2011, the company raised $85 million in a round of funding led by Greylock Partners and Insight Venture Partners.
- In May 2013 it was acquired for $1.1 billion cash.
Less Is More – or is it?
While designing user interfaces we are told to follow the principle “Less is more”.
It is not uncommon for the acquired company to shut after the acquisition, which happens mainly due to interference from the acquirer company management (or they discover a lot of dirt in the acquisition later). However, Yahoo CEO has assured they won’t screw with Tumblr. But her tweet says something more or “less”?
Few interesting articles to read about the acquisition,
- Why Yahoo acquiring Tumblr for $1 billion makes a certain horrible kind of sense
- Buying Pinterest would have made more sense for Yahoo
- The Tumblr Architecture Yahoo Bought for a Cool Billion Dollars – must-read for techies
- Can Yahoo Ignore Tumblr’s Dark Side?
- If Yahoo Buys Tumblr, What Will It Do With All That Porn? Simple answer, it will keep it! There is a good reason for that.
- Why Yahoo Doesn’t Think Tumblr Has a Porn Problem
- How Many Users Does Tumblr Really Have?
- Yahoo! And Tumblr It’s About Display, Streams & Native at Scale
- Yahoo Is Going to Run More Ads on Tumblr
- Tumblr Founder Says Site Will Stay an ‘Independent’ Effort
- Post-acquisition about 600 Tumblr users are moving to WordPress
- Marissa Mayer: Some Tumblr users “may never come to Yahoo,” and that’s OK