"Tumblr was an example of how to do social media right and we can learn a lot from it." I mean... maybe. Tumblr was also an example of maybe not pivoting the product to cater to the community properly, as there was a lot of other usage of Tumblr besides a strictly 'social media' use case. There was a lot of conversation around deeper feelings, and a community around self-discovery and self-awareness. I'm not 100% sure if Tumblr was able to properly capture that market and position itself there.
Tumblr
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Re: Tumblr
#32Earlier quoted context omitted.
Assuming you want to keep Tumblr running, you are also buying the ~200 employees and the costs of running the site. Assuming the 200 employees cost $100k each (salary + benefits) and you are already at $20M in costs.
If I bought Tumblr in a $3 million fire sale, I don't think I'd keep 200 employees on the payroll, but yes, it combined with the tax write-off and infrastructure costs it's reasonable for Yahoo to want to dump it as fast as possible—they could easily be losing $5M a month on it. I'm just shocked there aren't more opportunists in the market that would have bid the price up to at least something resembling reasonable.…
> If I bought Tumblr in a $3 million fire sale, I don't think I'd keep 200 employees on the payroll
Keeping most of the 200 employees on payroll may have been a condition of the $3m sale price.
Re: Tumblr
#33I saw the headline about the sale without the buyer in it and was sure that it had to be pinboard. That would have been something.
That's not what Maciej does. He is laser focused on bookmarking. That's why his company thrives.
Re: Tumblr
#34Now we are stuck with Facebook, a closed platform. Or Reddit, which masquerades as an open platform, but is really closed shut. There's only Twitter now. And Twitter kind of sucks.
Mastodon is great, and open. I like the community there more than Twitter's.
Which instance(s) do you like? I'm on fosstodon.
Re: Tumblr
#35> But it is also true that Tumblr was bypassed by native mobile applications like Instagram and Snapchat where it was even easier to post about your life. This. It's understated how much Tumblr's clunky composing hurt it as a platform. I know people connected to Tumblr, and from what I hear there was a lot of ideas but little direction. There was a time when Tumblr was bigger than Instagram— Tumblr could've focused m…
Heh, "tumblr ephemral"
That would be an interesting mobile app. There's nothing that does one to many ephemeral text messaging. I imagine they still have enough of a certain subgroup of adolescents to make a go of a new idea based on ephemerality. I don't know any young people that would use FB anymore than they would watch cable news. I imagine they'll screw up insta at some point too.
Re: Tumblr
#36Earlier quoted context omitted.
If I bought Tumblr in a $3 million fire sale, I don't think I'd keep 200 employees on the payroll, but yes, it combined with the tax write-off and infrastructure costs it's reasonable for Yahoo to want to dump it as fast as possible—they could easily be losing $5M a month on it. I'm just shocked there aren't more opportunists in the market that would have bid the price up to at least something resembling reasonable.…
> If I bought Tumblr in a $3 million fire sale, I don't think I'd keep 200 employees on the payroll Keeping most of the 200 employees on payroll may have been a condition of the $3m sale price.
Such a condition would definitely explain the price—although that would still be a pretty surprising condition.
Re: Tumblr
#37Re: Tumblr
#38Should we start entertaining the admittedly simple-minded notion that it is not tumblr that is under-valued, but everything else is over-valued?
Re: Tumblr
#39Now we are stuck with Facebook, a closed platform. Or Reddit, which masquerades as an open platform, but is really closed shut. There's only Twitter now. And Twitter kind of sucks.
Twitter, IMO, is wonderful when you stop following journalists, politicians, and A list celebrities. What that leaves is mostly meme makers and minor influencers who generally wrap all the bad stuff inside of funny jokes and hot takes.
Twitter is also excellent for following journalists, but i keep them sectioned off into their own list and try my best to limit the attention i pay to that.
I can see why people say twitter sucks, but really it only sucks if you're following a whole bunch of different "genres" in the same feed. the prolific tweeters like to talk about twitter in sections - "politics twitter", "black twitter", "meme twitter" etc and if that's how you use it, it's pretty good.
Re: Tumblr
#40I had heard the "well below 20m" figure and couldn't believe it—and now Fred is saying they dumped it for $3 million? I suppose if Verizon is taking the tax deduction on an original $1.1 billion purchase by Yahoo, the value of the deduction so much dwarfs the sale price that the difference to Yahoo between a $3 million sale price and a $50 million sale price is pretty minimal—they just want to close the deal to take…
> said on here the other day about adopting a "Berkshire model"
This is not the Berkshire model at all. Berkshire buys businesses that have high cash flow models where money can compound over and over, usually in well established businesses that have operational issues that can be optimized for cash flow.
> Just monetizing the web traffic 2.5 billions monthly hits at a $1 CPM alone would generate $2.5 million a month in revenue, $30 million annually.
That napkin math doesn't take into consideration:
- hosting costs
- software maintenance cost
- sales & marketing required to drive $30M/year
- Decrease in traffic due to ads
- Ad-blockers
> What kind of business, let alone web business, sells for 1/10th annual revenue?
Retail does...retail. Hate to break it to you, but businesses aren't bought and sold on revenue (despite what TC tells you). It's usually on a multiple of earnings or discounted free cash flow. Note - it's important to remember that DCF can get real fuzzy and hence why its much easier for media to just revert to "revenue".
> Reddit does 6x the page views, but is valued at $3 billion.
And Tumblr's valuation was once $1.1B and they couldn't monetize it. How is that comparable a valuable reference point?