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It makes perfect sense, they've got some technology out of it, some people who understand mobile, and a nice big headline. Worth $30m of my money? Probably not. Worth $30m of Yahoo's money? Maybe, they're not likely to have decided to spend that much on an acquihire without board approval really are they. Unless they Zuckerberg'd it and thought it was better to seek forgiveness.
Long earn-outs could be one factor. Giving engineers $1mm with 1/2/3/4 4-year earn-outs would even be on the low side. Doing the same with a founder would obviously be worth less (especially at Yahoo!, given how founders historically leave after acquisition)
SRI is presumably getting a big chunk for a new license. Maybe even a domain-exclusive license. That alone could be $0-100mm.
If it's equity, it is a lot better for Yahoo!
It's possible the founders and key employees have a weird incentive structure -- if they continue with the product and get 50mm users, they'd get a payout of an extra $10mm vs. otherwise, for instance. That kind of thing could add to the reported deal figure without adding much risk to Yahoo!. (I'm sure I could get a "if you turn Yahoo! into a $60b/yr business in the next 3 years, you can have an extra $100mm" on any deal.)
I'm not Marissa Mayer's biggest fan, but I don't think she's in the same vein as the previous leadership at Yahoo!, so presuming that they're throwing money away irrationally isn't the first thing I'd do.
That's true of most of these acquisitions. There are a lot of qualified people doing crazy things, but the smartest people aren't always the ones who win. That fact is immaterial here until we find out what other things they got (maybe the kid brings along investors who may buy more yahoo stock ?)
I do agree, in general, that as a public company Yahoo has to explain to shareholders why they made the acquisition.
Kudos to the kids for actually making a product people wanted to use, and at least one person wanted to buy.
When the number sounds way too high and it's from a single anonymous source and no one else is talking - it's often a lie. People have big egos.
What's the point? Doesn't the truth come out eventually? Yahoo is a public company, their financials aren't exactly secrets.
There's a possibility that this publicity changes younger people's perception of Yahoo's. They'll see the BBC headline and a) will now know what Yahoo! is and b) might get motivated to write/learn code and even want to go work for a tech company (even Yahoo itself). Combined with everything else Marissa Mayer is doing, (b) might actually happen, as altruistic-seeming as it might sound.
From the article, Let's ignore the hurt feelings that our employees will have about making a 17 year-old a millionaire. The price tag for this company aside, am I the only one that detects a hint of jealousy in some of the comments that seem to imply "but he's too young to be a millionaire!"?
As someone who isn't remotely jealous for the kid (I'm happy for him actually), let's not pretend that he is an innovator. It's a link aggregator app, no different than pulse or others. In fact, the difference from Pulse is that its inferior, because it displays far less at a time. But that is my opinion, and I'm sure a lot of older folks like it better BECAUSE it displays less. Kid: Go for it dude, and good luck. Ya…
C'mon, this can't be the first time you've noticed that "innovation" has been overused to the point of meaninglessness in tech. "Disruption" doubly so. Don't harp on this kid, he is no less innovative than 95+% of "innovation" I've heard about in the last year.