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Union Square gets 5,000% return on Tumblr

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Re: Union Square gets 5,000% return on Tumblr

#21

Post by michaelochurch »

dot wrote: post #5

> Tumblr's employees will also do well. The company's first 10 employees will receive an average of $6.2 million in cash; the first 30 will receive an average of $3.3 million in cash, and the rest of the 178 employees will each receive $371,000. Is it usual to announce these numbers for all employees with acquisitions like this?

and the rest of the 178 employees will each receive $371,000.

So they get a one-time mid-level banking bonus, and now they work for a completely different company and almost certainly in positions lower than what they used to have.

VCs would quit given year-end bonuses like that.

Re: Union Square gets 5,000% return on Tumblr

#22

Post by pkmehta »

josh2600 wrote: post #20
sgpl wrote: post #9

According to PrivCo [ http://goo.gl/AW7GD ], here are all the payouts of the 1,100 mn: $286 mn: USV $231 mn: Spark Capital $253 mn: David Karp $176 mn: Sequoia $88 mn: Greylock, Insight Ventures, DFJ $66 mn: Employees (6% of the 1,100 mn) The math adds up to 71% of Tumblr being owned by VCs. Also Bloomberg reported that David Karp asked for as much stock as Yahoo would give him, because he sees himself working on Tum…

Please note, PrivCo is super scandalous. Remember all the crazy crap they did to LivingSocial? http://pandodaily.com/2013/02/21/privco-may-be-wrong-but-liv... I don't trust them at all.

Writers/editors from major techh publications don't seem to trust Privco's data or practices either it seems - https://twitter.com/MikeIsaac/status/336949975634296833

Re: Union Square gets 5,000% return on Tumblr

#23

Post by patio11 »

jlgreco wrote: post #10
sgpl wrote: post #9

According to PrivCo [ http://goo.gl/AW7GD ], here are all the payouts of the 1,100 mn: $286 mn: USV $231 mn: Spark Capital $253 mn: David Karp $176 mn: Sequoia $88 mn: Greylock, Insight Ventures, DFJ $66 mn: Employees (6% of the 1,100 mn) The math adds up to 71% of Tumblr being owned by VCs. Also Bloomberg reported that David Karp asked for as much stock as Yahoo would give him, because he sees himself working on Tum…

The notion of 30 year old websites seems incredibly alien to me, but I suppose there is no real reason why that should never happen.

I empathize with that feeling, but would point out that if they were people, Intel would be getting yearly prostate screenings, Accenture would be retired, and Nintendo would be dead.

Re: Union Square gets 5,000% return on Tumblr

#24

Post by jlgreco »

patio11 wrote: post #23
jlgreco wrote: post #10

Earlier quoted context omitted.

The notion of 30 year old websites seems incredibly alien to me, but I suppose there is no real reason why that should never happen.

I empathize with that feeling, but would point out that if they were people, Intel would be getting yearly prostate screenings, Accenture would be retired, and Nintendo would be dead.

Oh, for sure. The web still feels so young though, but I suppose there is no reason these companies would not be able to move with technology as it dramatically changes, as the companies you mention have (particularly Nintendo).

Re: Union Square gets 5,000% return on Tumblr

#25

Post by bluedino »

larrys wrote: post #15
dot wrote: post #5

> Tumblr's employees will also do well. The company's first 10 employees will receive an average of $6.2 million in cash; the first 30 will receive an average of $3.3 million in cash, and the rest of the 178 employees will each receive $371,000. Is it usual to announce these numbers for all employees with acquisitions like this?

"the rest of the 178 employees will each receive $371,000." Interesting to keep in mind for anyone working for a startup as a metric. You work and have a chance, if the idea hits (to the tune of 1 billion) of making low to mid 6 figures. $371k is certainly nice but considering the amount of startups that not only don't succeed but don't succeed to the extent that Tumblr did ...

Imagine being at Instagram, $1bn and only what, 14 employees?

Re: Union Square gets 5,000% return on Tumblr

#26

Post by johnrob »

larrys wrote: post #12

""For Tumblr's employees, they will go on to start their own companies and create new jobs; David Karp and his co-founders will likely become active angel investors or VCs; and Union Square Ventures will reinvest much of its returns back into the next generation of New York City startups."" So essentially the things that made the company "magic" will no longer be fully invested in it's future success. And the new hir…

Isn't this always the case with acquisitions though?

Re: Union Square gets 5,000% return on Tumblr

#28

Post by graycat »

patio11 wrote: post #23
jlgreco wrote: post #10

Earlier quoted context omitted.

The notion of 30 year old websites seems incredibly alien to me, but I suppose there is no real reason why that should never happen.

I empathize with that feeling, but would point out that if they were people, Intel would be getting yearly prostate screenings, Accenture would be retired, and Nintendo would be dead.

Yes, but since Intel does seem to be still standing, they would pass a prostrate screening.

However, they might want a prostate screening. Indeed, as I recall, Andy Grove did.

Re: Union Square gets 5,000% return on Tumblr

#29

Post by chewxy »

fredwilson wrote: post #27

Total garbage. There is not one fact in this privco thing that is close to right. The numbers are good but nowhere close to that good. This is the same firm that predicted Foursquare would be out of business this year which will also prove to be nonsense.

There you go folks, out from the horse's mouth

Re: Union Square gets 5,000% return on Tumblr

#30

Post by wallflower »

wellboy wrote: post #2

Mind that that's "only" 50x. Still not bad though.

Usually, when you have $5m to invest, you have to put it into something large and very real and quite boring like a shopping center. And if you get a IRR of 8-9% a year, you're doing well. USV turning $5m into 50x that is along the lines of Don Valentine and Cisco. It is a rare cosmic event.
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