"F--- yeah." This was how David Karp, a 26-year old Tumblr Inc. CEO, closed his announcement of Yahoo! Inc. acquiring his company for $1.1 billion.
Karp was very excited about the new direction of Tumblr now that it is owned by Yahoo! However, he clarified that the company will preserve its identity.
"Our headquarters isn't moving. Our team isn't changing. Our road map isn't changing," Karp said. "Our mission -- to empower creators to make their best work and get it in front of the audience they deserve -- certainly isn't changing."
PrivCo, a New York-based research firm specializing in closely held companies, revealed that Karp is getting $209 million in cash from the deal and will remain as Tumblr's CEO.
Yahoo! CEO Marissa Mayer decided to close the deal as she believed that it will increase their service further since Tumblr is receiving over 13 billion page views on a monthly basis. Yahoo! is in the process of acquiring different companies as part of their expansion plans. In fact, they purchased Summly, the developer of a news-reading application owned by a 17-year old Nick D'Aloisio , for $30 million in March.
Back in 2010 in a Los Angeles Time interview, Karp said that he is not in favor of advertisements showing up in Tumblr. However, his decision was changed when he started accepting advertisements in 2012 to generate revenues.
Users pay Tumblr to increase the ranking and visibility of their posts in the site. In 2012, the company earned $13 million especially after launching their mobile app. Karp didn't expect to sell Tumblr this year based on the current status of the company's financial records. They were losing money as they focused more on user experience than revenue. He was surprised when Yahoo! offered him a billion-dollar note.
Now that Yahoo! has acquired Tumblr, users should expect one major change- the site will be separated from Google-related sites such as Facebook and Google+. Users are now encouraged to switch to WordPress.
