Yahoo might buy Tumblr for $1 billion

Yahoo might buy Tumblr for $1 billion

May 17, 2013

Great job everyone! All those blog posts, GIFS and nudie pics have pushed Tumblr to the brink of a $1 billion dollar acquisition by Yahoo.

All Things D reports that Yahoos new CEO Marissa Mayer has been closely watching Tumblr since her time at Google, and has recently engaged with top execs including founder and CEO David Karp in talks to acquire them.

AdWeek reports “The deal is not done, but could reach as high as $1 billion.” Tumblr’s $125 million in funding already places it at $800 million in value, and it’s recently been in talks for another round that would add another zero to its price tag.

Of course, the deal could fall through or result in some kind of “strategic partnership” investment. But so far Marissa Mayer has been focusing on making small-sized app acquisitions like Summly, which, while they have been news-worthy, haven’t exactly bought Yahoo an large and actively engaged audience. A Tumblr acquisition would use Yahoo’s substantial capital to leverage an actual user base.

And unlike Flickr, which Yahoo bought the year after it was founded, Tumblr been around long enough that it’s probably not going to become irrelevant—or at least its users probably aren’t going to vanish—in a hurry. Yahoo did, however, tank the Flickr user experience soon after they bought it – alienating the original core users in the process.

Could Tumblr be this year’s $1 billion acquisition?


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