Rumor Alert: Yahoo Is Buying Tumblr for a Billion?

Yahoo has a problem: it has no idea what it's doing, or how it's going to do it (outside of teenage dream hires). Some people who claim intimate knowledge say the company is going to do it by throwing a serious Hail Mary: buying Tumblr for $1,000,000,000. That's one billion.

AdWeek says AllThingsD says Tumblr's had Marissa Mayers gaze for some time now:

It?s not the first time Yahoo CEO Marissa Mayer has been interested in the New York-based hipster blogging service. As an executive at Google, she had closely watched its fast growth, along with that of Foursquare. Since she took over at Yahoo, several sources said that she has met with its top execs, including founder and CEO David Karp.

But sources said that interest has gotten stronger more recently, coming at the same time as Tumblr has been stepping up its efforts to raise a large funding round that could value the New York company at $1 billion.

Given how little Tumblr's shows it can earn, this would be a major (risky!) purchase. But nothing urges By God, Yes, Make that major purchase like the stench of financial ruin, and it'd be a godsend for Tumblr. The supremely popular service is, well, supremely popular, but a revenue dearth combined with leadership doubts about founder David Karp mean the property isn't as sweet as it might've been in years past?a billion dollars is generous. But at least we can assume Yahoo would take care of all the porn.

Source: http://valleywag.gawker.com/rumor-alert-yahoo-is-buying-tumblr-for-a-billion-507915558

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