Tumblr May Reject Yahoo’s $1.1B Acquisition Offer For Being “Too Low” • Hacker News Board

Re: Tumblr May Reject Yahoo’s $1.1B Acquisition Offer For Being “Too Low”

#51

Post by larrys » Sat, May 18, 2013, 8:12 PM UTC

daeken wrote: post #13

> Tumblr feels that Yahoo’s $1.1 billion offer as “too low” and view it as “only a first offer” And then later in the paragraph: > sources say the company only has a few months of cash runway left. This must be a joke. If you have a few months of cash runway left, $1.1B is more than enough. Seriously. There is no circumstance when this isn't true, unless you have massive non-cash assets on hand. Yes, I'm aware that t…

"If you have a few months of cash runway left"

Keep in mind that there are many sources of money that you can get to keep you afloat if you have a defacto value like that. (This is not like the local bakery that only has a few months of cash and a local businessman comes along and offers to buy for a nice price - better not pass it up!)

Re: Tumblr May Reject Yahoo’s $1.1B Acquisition Offer For Being “Too Low”

#52

Post by larrys » Sat, May 18, 2013, 8:19 PM UTC

tptacek wrote: post #40

daeken wrote: post #13

> Tumblr feels that Yahoo’s $1.1 billion offer as “too low” and view it as “only a first offer” And then later in the paragraph: > sources say the company only has a few months of cash runway left. This must be a joke. If you have a few months of cash runway left, $1.1B is more than enough. Seriously. There is no circumstance when this isn't true, unless you have massive non-cash assets on hand. Yes, I'm aware that t…

I don't understand this mentality and you at least are someone I know I can engage with. So, tell me, what makes you believe that you're qualified to determine what Tumblr's worth? "Billion -- with a 'B'"... so what? Tumblr's worth what they're worth. If they're intrinsically worth more than 1.1Bn because of stats we don't really know about or understand, there's nothing unseemly about turning down an offer that unde…

"I don't understand this mentality"

I think the mindset that describes people who say something like this may echo what others might think. Particularly the saying "pigs get fat, hogs get slaughtered" comes to mind [1].

Also the idea that value doesn't change and that there is no downside risk to not sellig for 1.1b cash (there is since there is always a down side to any decision to some degree).

I know of business people on a smaller scale who had passed up a almost perfect deal and held out and lost the entire deal because some event happened to change the circumstances. (Health of an individual, market, neighborhood, events (like 911, wars etc.) whatever. Things can and do change.

Take your firm that you sold for example. It is made up of key individuals. At a certain point you decided to sell. What if you had held out? Could have gotten more perhaps but also could have had something happen to a few key individuals that might make the firm less attractive. (Not thinking security consulting going out of favor though obviously).

While non of the examples that I am giving apply to tumblr I'm just pointing out that people tend to not look very closely at what they stand to lose vs. what they are holding out for. At least from what I have seen over time.

I don't know if 1.1 is the right number or not, just trying to give another angle to this.

[1] Greediness maybe that's the word I am looking for here.

Re: Tumblr May Reject Yahoo’s $1.1B Acquisition Offer For Being “Too Low”

#53

Post by daeken » Sat, May 18, 2013, 8:24 PM UTC

tptacek wrote: post #40

daeken wrote: post #13

> Tumblr feels that Yahoo’s $1.1 billion offer as “too low” and view it as “only a first offer” And then later in the paragraph: > sources say the company only has a few months of cash runway left. This must be a joke. If you have a few months of cash runway left, $1.1B is more than enough. Seriously. There is no circumstance when this isn't true, unless you have massive non-cash assets on hand. Yes, I'm aware that t…

I don't understand this mentality and you at least are someone I know I can engage with. So, tell me, what makes you believe that you're qualified to determine what Tumblr's worth? "Billion -- with a 'B'"... so what? Tumblr's worth what they're worth. If they're intrinsically worth more than 1.1Bn because of stats we don't really know about or understand, there's nothing unseemly about turning down an offer that unde…

At the end of the day, it all comes down to: they would sell for $1.1B in a heartbeat without any of this public posturing if they knew they weren't going to get any offers for more money today. They would take the money and be damn happy about it. Instead, they say "pfft, this is too low! We clearly need more for our unmonetized product!"

That's the part that pisses me off, not that they value it differently -- because they don't! They know that $1.1B is a great price for what they have to offer, they just think that they can grumble about it and get a bit more from someone else. This sort of negotiation isn't skillful, it's heavy-handed and completely and utterly transparent.

Re: Tumblr May Reject Yahoo’s $1.1B Acquisition Offer For Being “Too Low”

#54

Post by Tycho » Sat, May 18, 2013, 8:27 PM UTC

thoughtcriminal wrote: post #24

neya wrote: post #5

Here's my perspective as a hardcore tumblr user - Tumblr is a good example of an 'uncontrolled platform'. What started as a beautiful blogging platform, has now turned into a junkyard of cat memes, 'blurr-photo-in-the-background' quotes and animated GIF thumbnails of movie snapshots and softcore pornography. Of course your feed depends on what/who you subscribe to..but due to the nature of Tumblr's platform, even the…

$1.1 Billion is a really good deal for a trashcan full of 99% animated cat GIFs and 1% decent content. Have you read Yahoo news lately? It's dumbed-down sensationalistic garbage that makes Tumblr look absolutely brilliant in comparison.

Don't the generally just get news from Reuters and AP?

Re: Tumblr May Reject Yahoo’s $1.1B Acquisition Offer For Being “Too Low”

#55

Post by tptacek » Sat, May 18, 2013, 8:52 PM UTC

daeken wrote: post #53

tptacek wrote: post #40

Earlier quoted context omitted.

I don't understand this mentality and you at least are someone I know I can engage with. So, tell me, what makes you believe that you're qualified to determine what Tumblr's worth? "Billion -- with a 'B'"... so what? Tumblr's worth what they're worth. If they're intrinsically worth more than 1.1Bn because of stats we don't really know about or understand, there's nothing unseemly about turning down an offer that unde…

At the end of the day, it all comes down to: they would sell for $1.1B in a heartbeat without any of this public posturing if they knew they weren't going to get any offers for more money today. They would take the money and be damn happy about it. Instead, they say "pfft, this is too low! We clearly need more for our unmonetized product!" That's the part that pisses me off, not that they value it differently -- beca…

Wouldn't they sell for $25.53 in a heartbeat if they knew they weren't going to going to get any other offers or money?

Re: Tumblr May Reject Yahoo’s $1.1B Acquisition Offer For Being “Too Low”

#56

Post by daeken » Sat, May 18, 2013, 8:55 PM UTC

tptacek wrote: post #55

daeken wrote: post #53

Earlier quoted context omitted.

At the end of the day, it all comes down to: they would sell for $1.1B in a heartbeat without any of this public posturing if they knew they weren't going to get any offers for more money today. They would take the money and be damn happy about it. Instead, they say "pfft, this is too low! We clearly need more for our unmonetized product!" That's the part that pisses me off, not that they value it differently -- beca…

Wouldn't they sell for $25.53 in a heartbeat if they knew they weren't going to going to get any other offers or money?

If they got such an offer, I imagine that they'd be willing to hold out for a couple months to get something better. But a $1.1B offer? That's not something you wait to accept. If they don't get a better offer in the next few weeks, they'll gladly take $1.1B, even if they suspect they can get a bit more in a few months or a year.

Re: Tumblr May Reject Yahoo’s $1.1B Acquisition Offer For Being “Too Low”

#57

Post by [deleted] » Sat, May 18, 2013, 9:30 PM UTC

Tycho wrote: post #54

thoughtcriminal wrote: post #24

Earlier quoted context omitted.

$1.1 Billion is a really good deal for a trashcan full of 99% animated cat GIFs and 1% decent content. Have you read Yahoo news lately? It's dumbed-down sensationalistic garbage that makes Tumblr look absolutely brilliant in comparison.

Don't the generally just get news from Reuters and AP?

[deleted]

Re: Tumblr May Reject Yahoo’s $1.1B Acquisition Offer For Being “Too Low”

#58

Post by nightmann » Sat, May 18, 2013, 11:55 PM UTC

antr wrote: post #19

If I were a Yahoo shareholder, even at a $1.1bn price tag, I would vote against the acquisition. > Tumblr has no real revenue, let alone profit, making it a value dilutive acquisition for Yahoo. > The acquisition price is artificially being inflated by investors who are trying to squeeze Yahoo, who is trying to "turnaround" its profitable business. The $1.1.bn price is already "too high" for Tumblr's true underlying…

> The acquisition price is artificially being inflated by investors who are trying to squeeze Yahoo, who is trying to "turnaround" its profitable business. The $1.1.bn price is already "too high" for Tumblr's true underlying value.

That's the market. If Yahoo thinks tumblr is worth $1.1B, then Yahoo will pay $1.1B; if not, then they won't. How the price got there (by some artificial inflation or whatever) is irrelevant.

> Yahoo has no track-record of successfully acquiring, integrating and generating value from such acquisitions. Broadcast.com ($5.7bn), GeoCities ($3.6bn), Inktomi ($235m), Overture ($1.6bn), del.icio.us ($20m), Flickr ($?m), and the list goes on.

All the acquisitions cited are 8+ years old. And it is hard to say whether the recent acquisitions (within the past, say, 5 years) are doing well or not.

(I would also vote against the acquisition, but for other reasons)

Re: Tumblr May Reject Yahoo’s $1.1B Acquisition Offer For Being “Too Low”

#59

Post by rukshn » Sun, May 19, 2013, 7:45 AM UTC

standby wrote: post #50

rukshn wrote: post #39

Earlier quoted context omitted.

thanks for the information. I never knew wordpress emails support adding tags like tumblr up to now. It was really helpful. The reason I switched from wordpress to tumblr is wordpress started displaying ads on my blog as they do with some blogs at some times. But if yahoo buy tumblr should consider switching to wordpress or blogger or some self hosting platform

But why? Why just consider switching? Why not wait to see what, if anything, actually changes? And if those changes are for the better? You had a valid reason switching from Wordpress to Tumblr, but you don't provide one from switching away. There is so much angst from the teenage users using Tumblr that are panicking about the buyout and making similar threats. I don't expect to see that mentality without sound reas…

yah true I understand. But for some reason yahoo has not being good with things they buy. Flickr delicious geocities etc. So how can we be sure what they're going to do with Tumblr and how can we be sure it's going to be better?

Yah i know it's too early to talk about it. Will see and wait. And from the news it seems Tumblr directors have given go signal to yahoo offer.

"Forbes' Jeff Bercovici reported Tumblr's board of directors approved Yahoo!'s offer and the Yahoo! board is expected to go along with Mayer's wish to buy Tumblr. There's still a little room for things to fall apart, but it's unlikely that's going to happen. So no, the Yahoo! deal will likely not be falling apart."