BILLION dollar deal makes 26-year-old America's next tech tycoon:

[chrisj1968]

http://www.dailymail...ech-tycoon.html

BILLION dollar deal makes 26-year-old America's next tech tycoon: High school drop-out behind blogging site Tumblr

sells it to Marissa Mayer's Yahoo

• New Yahoo CEO Marissa Mayer believes purchase of mico-blogging site will be a 'stake in the ground' for her tenure as head of the tech giant
  
• Board approached all-cash purchase on Sunday, despite Tumblr having only $13million in revenue last year
  
• David Karp founded Tumblr in his mother's Manhattan apartment in 2007
  
• Site boasts 100million users and 90million daily blog posts
  

David Karp, the 26-year-old founder of blogging site Tumblr, has just made to make a lot of money - almost in spite of himself.

Yahoo's board of directors agreed on Sunday to buy his wildly popular blogging platform, which boasts 100million users and 90million posts per day, for $1.1billion cash.

The deal could make the native New Yorker the latest 20-something tech billionaire, even though he was publicly opposed, even just last year, to selling the company he founded out of his mother's small Manhattan apartment in 2007.

On Sunday afternoon, it was revealed Yahoo's board approved the purchase of Tumblr, despite its revenue of only $13million last year. Even that figure was only made possible after $125million in capital investments.

Rich man: David Karp, who founded Tumblr in 2007 in his mother's Manhattan apartment, just made hundreds of millions of dollars after his company was purchased by Yahoo

Moving on up: Karp lives with his girlfriend Rachel Eakley, a graduate student and chef, in a modest apartment in Manhattan's West Village

Miss Eakley has been Karp's constant companion at public events for several years

Tech news site AllThingsD reports that new Yahoo CEO Marissa Mayer wanted to quickly snatch up Tumbler as 'the stake in the ground of what her strategy is going forward for Yahoo.'

Tumblr, which is a mico-blogging platform for quickly posting pictures, text and video, also functions as a social media site.

Its platform manages to blend elements of all of the major social networking sites. Sharing and posting photos and simple and easy, like Instagram. Gifs moving images, pictures, and videos are all easy to share. But, users follow other Tumblr blogs and compile news feeds, making the site similar to Facebook and Twitter.

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The easy, simple layout of Tumblr blogs has spawned diverse, quirky, blogs. An enormously popular Tumblr called '#whatshouldwecallme' features a series of animated gifs explaining the reactions to daily life of a 20-something woman.

However, celebrities like Joe Jonas and Lady GaGa also have popular Tumblr pages and companies like the shoemaker Col Haan use the site as a creative way to market their products.

Tumblr is also popular with many pornstars and features numerous sexually-explicit blogs.

Tumblr boasts remarkable loyalty among its users. Some 85percent of Tumblr users make 20 or more posts a month.

Big deal: Marissa Mayer is reportedly staking her reputation as Yahoo CEO on this Tumblr deal

However, Karp - a high school dropout who taught himself how to code - had expressed grave reservations about giving up his brainchild to a Silicon Valley tech giant.

In a 2012 interview with the Guardian, he said he had been swatting away buy-out requests for years.

'Particularly in the first three years, there were a lot of (mergers and acquisitions) people who would pull you aside and you'd think "Well, s***, I could be a pretty rich 23-year-old with very little effort,"' he said.

'We stuck it out. I won't say I really knew why.'

Perhaps the perseverance makes sense to Karp now that he is 'very rich' at age 26.

The deal conjures images of another young man who is very rich - Facebook founder Mark Zuckerberg.

At $1.1billion, Tumblr's worth is nowhere near the value of $100billion Facebook, but 29-year-old Zuckerberg's success has become something of a pattern for young, brilliant tech entrepreneurs.

It is unclear how large a stake in the company Karp maintained before the Yahoo deal.

In 2008, he sold a 25percent stake to investors for $750,000.

The investor share of the company was $125million at the time of the deal, according to AllThingsD.

Karp grew up on Manhattan's tony Upper West Side, the son of a music composer father who wrote songs for films and TV shows and a mother who was a teacher.

Very young and very rich: Karp and Eakley, who enjoy spending their Sunday mornings at brunch in Manhattan's East Village, are now due for a major lifestyle change

Unlike the famously-dressed-down Mark Zuckerberg, Karp prefers wearing plaid instead of a hoody. But he's not afraid to wear a suit, either.

He taught himself how to code HTML at age 11 and began setting up his own consulting business shortly thereafter. His parents allowed him to drop out of high school at age 15 and complete the remainder of his education by homeschooling.

At age 17, he moved to Japan, where he cemented his skill as a programmer and began pitching his ideas to tech companies.

He moved back to New York and sold his services as a consultant. He founded Tumblr in 2007 at age 21 - and it quickly consumed all of his time.

He started up an office in Manhattan and has ardently resisted the lure of moving to Silicon Valley. He also tried to resist the money that the tech world had to offer.

He told the Guardian that he wanted to remain independent - believing he could grow the company by growing ad revenue naturally.

Within a year, though, he was accepting funds from venture capital investors.

He currently lives with his girlfriend in a modest apartment in Manhattan's West Village. Rachel Eakley is a chef and a graduate student studying psychology.

[Raa]

I bet he's laughing all the way to the bank... lucky guy!

[123456789A]

That's pretty impressive. I don't see how it could be valued so high, but good for him!

[Praetor]

hurrr...13 million profit after 125 million invested? and sold that to 1.1 billion?

[max22]

Cool guy and people say kids aren't smart.

Every time someone says a kid is stupid I point and laugh at them. He taught himself HTML coding when he was only 11.

[primexx]

Cool guy and people say kids aren't smart.

Every time someone says a kid is stupid I point and laugh at them. He taught himself HTML coding when he was only 11.

to be fair, html isn't exactly hard to learn

[Raa]

to be fair, html isn't exactly hard to learn

That may be true, but you don't see everyone doing it - let alone making a billion bucks out of it...

[astropheed Veteran]

Cool guy and people say kids aren't smart.

Every time someone says a kid is stupid I point and laugh at them. He taught himself HTML coding when he was only 11.

One bright kid does not mean kids are bright, it means one kid is bright.

[Boz]

let just to be clear, with the investments of $125 million dollars so far, he is not getting a billion bucks.. it's going to be much much less than that, but still very nice for a 26 year old.

The problem with these acquisitions is that these start-ups are not worth anywhere close to those amounts of money, especially when you consider they have been losing money. This is hurting A TON of new fresh start-ups with actual products that make money because it sets completely unrealistic expectations for investors and companies.

[Growled Member]

The problem with these acquisitions is that these start-ups are not worth anywhere close to those amounts of money, especially when you consider they have been losing money.

I agree but I think Yahoo is buying the idea rather than the startup. Apparently they see great potential in it.

[astropheed Veteran]

I agree but I think Yahoo is buying the idea rather than the startup. Apparently they see great potential in it.

If Yahoo think you have potential, do you? lol :p

[Growled Member]

If Yahoo think you have potential, do you? lol :p

Coming for Yahoo? No. :D

[Boz]

I agree but I think Yahoo is buying the idea rather than the startup. Apparently they see great potential in it.

I don't think it's about the idea.. There's nothing special about Tumblr. Yahoo is buying users really and popularity of the platform.

IMO they should have invested a fraction of that money and improved Flickr to take on Tumblr as they already have HUGE popularity with Flickr. Buying Tumblr for a billion dollars doesn't really solve anything for them.

[Xilo]

let just to be clear, with the investments of $125 million dollars so far, he is not getting a billion bucks.. it's going to be much much less than that, but still very nice for a 26 year old.

The problem with these acquisitions is that these start-ups are not worth anywhere close to those amounts of money, especially when you consider they have been losing money. This is hurting A TON of new fresh start-ups with actual products that make money because it sets completely unrealistic expectations for investors and companies.

It really hurts the companies buying them up as well. Once the acquisitions happen, they don't meet quarterly profits, then they lay off a bunch of people.