Sunday, May 19, 2013

Yahoo's Board Approves $1.1 Billion Purchase Of Tumblr - Business ...

Yahoo's board approved the plan to buy Tumblr for $1.1 billion in cash, Kara Swisher at All Things D reports.

Previous reports said that Tumblr's board had OK'd Yahoo buying Tumblr, so it looks like it's a done deal.

Marissa Mayer has made her first big move as CEO of Yahoo. She's buying a social networking site with a younger audience, and a ton of page views. Now it's time to monetize the thing.

Tumblr has just $13 million in revenue right now. It should be able to increase that revenue following the model of Twitter and Facebook.

People who use Tumblr follow other Tumblrs through a "Dashboard." This works like Twitter or Facebook with other Tumblr blog posts flowing through a timeline. Presumably, Tumblr can start inserting ads between users posts like Twitter inserts sponsored posts.

Tumblr has raised $125 million in funding. It's last round of funding reportedly valued the company at $800 million. It was looking for more funding when Yahoo stepped in.

Reports on the deal say that Tumblr's 26-year-old CEO David Karp will be able to operate fairly autonomously. Karp will be locked into a four-year deal to stay at Tumblr, All Things D reported. That should assuage the fears of any Tumblr users about how things could change (for the worse) under Yahoo.


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