"We’ve kept all your valuables safe. In each of our products, you’ll find a tile to click on that initiates the export service. Your kept items will be exported as bookmarks and the feeds you follow as an OPML file."
This is Vinod and Marc Andreessen, we put a lot of money in this company, hoping Facebook would buy it for a $billion . At this point we want to get our money back. What do you say you do us a favor and buy this company? We owe you on this one.
If this were the first in this long line of crap-quisitions, I'd disagree with you, but I see Yahoo as the Island of Lost Startups.
Tying multiple disparate teams into a cohesive product will be really hard. I don't see what good will come of this, except getting Yahoo positioned to have early access to a16z and Khosla startups.
It's cynical but there is a lot of cognitive dissonance surrounding software startups. The players involved in a deal like this seem to go through a lot of twisted internal logic to convince themselves that what they are doing isn't just an investor shell game. Whereas a corporate raider type simply wouldn't care about having extra-financial justifications for the deal.
I'm not saying that is what happened here, but I have been involved in a startup acquisition which was an investor shell game, and even guys who lost in the acquisition had to come up with a warped internal history about what happened in order to not feel bad about it, or something...
To be honest, I wish I wouldn't have use that phrase because it adds negativity that is probably unnecessary.
In my case, what happened is the failed startup I worked for was "acquired" by another company that was funded by the same investors. The acquiring company wasn't acquiring anything: the software was open source, none of the founders worked there anymore, no key engineers were left, etc. The deal was done to avoid a loss on the VC balance sheet so that the fund wouldn't lose face with its institutional investors. The people who benefit: investors, and also mediocre late hire employees who stuck around through the transition. They ended up with a higher salary and better title than they would have if they had been hired directly by the acquiring company.
When I read about an acquisition where it doesn't seem like anyone is going to make money, nobody uses the product, the founding team isn't there anymore and key engineers have left, it just reminds me of this situation I already lived through.
For those keeping score, this gives another win for Khosla Ventures, SV Angel, a16z, and First Round. Here's the tally for those who invested in companies that have been acquired by Y! since Mayer took over:
CrunchFund - 3 (Stamped, GoPollGo, Tumblr)
True Ventures - 3 (OnTheAir, Snip.It, Lexity)
Khosla Venture - 3 (Snip.It, Xobni, Rockmelt)
SV Angel - 3 (Snip,It, Xobni, Rockmelt)
Google Ventures - 2 (Astrid & Stamped)
Spark Capital - 2 (Tumblr & Lexity)
Jack Herrick - 2 (Qwiki & Astrid)
Greylock - 2 (Tumblr & Qwiki)
First Round Capital - 2 (Xobni & Rockmelt)
Also to note, Lexity & Jybe were founded by former Y! employees.
Obviously a larger return (10x-100x) is more of a win but to discount a modest exit that an investor and founder(s) agree on as not a win is a bit harsh. Each one of these startups has a different story and had their own definition of what was considered success and a good investor's reputation is also based on ensuring that startups can achieve that.
One of these days, I'm going to come across a blog post about an acquisition that doesn't begin with "We’re excited to tell you..." and ends in a disaster for the majority of employees.
One of these days...
That said, recycling old Yahoo addresses, buying Tumblr, Snip.it, Summly... anyone see a pattern?
I can see Yahoo is trying to muscle in on Pintrest's turf with this and maybe even venture into Google Plus land : "Discover & share with Facebook, Twitter, and beyond."
The "beyond" is where Yahoo can provide infrastructure to build/extend their own social network.
It probably looks wonderfully strategic from a 10,000 foot view. Now imagine the task of actually gluing these acquisitions together for the actual engineers, not to mention the culture clashes that inevitably occur with acquisitions. I'm having a panic attack just thinking about it.
They're several years late on that strategy, though. Not a deal breaker, but they've seen how hard it is for Google Plus to get people on a social network. That's with Google even sacrificing their other products to shove it down everyone's throat. Yahoo will need some finesse and real in-house innovation if they're going to compete in that area.
I don't see a pattern, I see a struggling company trying to remain competitive buying all it can get away with and seeing what sticks. Hope it works out well for them. If anything, these small companies can bring a new air to an old behemoth.
Maybe that's the strategy as well, but I can see the new technology making its way to Yahoo's current strategy.
But what struck me was that they bought Tumblr, Jybe, Snip.it, Alike and Summly this year alone and they're all "social" as well as Ztelic, which is "social analytics" (whatever that means) from China. They also bought GhostBird for mobile photography. In one year, they made acquisitions that were very mobile, social and analytics heavy so "social" is very much in their future path somehow.
Yahoo seems to be trying to dig themselves out of a hole by standing in the hole and throwing sand out.
Is Yahoo trying to set up some kind of 'corporate rehabilitation' clinic where they will take these scruffy startup employees and turn them into drones slaving away on methods to get users to click on ads 5% more?
I can understand acquiring a startup when you plan to use their product and will keep the founders working on it, but something like this just rings of a failure to understand human behavior. The guys getting a fat payout and corporate safety net while working on some random project they didn't even agree to work on are no longer the same guys who made the startup.
I could see the logic in buying up end-of-their-tether companies if Y! was getting them at a fire-sale price. Being able to buy undervalued assets at fire-sale prices is exactly why anyone buys a company that's about to fail. But there's not a lot of evidence that they're getting the kind of prices you'd expect them to be able to get from people whose alternative to selling is going out of business, which is (to put it charitably) puzzling.
The guys getting a fat payout and corporate safety net while working on some random project they didn't even agree to work on are no longer the same guys who made the startup.
Yahoo shareholders should pool together and stick this on a billboard outside Yahoo HQ.
its worse when these guys that burned through $40M+ are going to be backed by their investors again at the expense of more worthy startup founders with less experience fundraising.
We might want to consider that Yahoo is corrupted from the inside and is using its large range of financial assets to spread its wealth via various sidesteps and investment networks. Unless they will release some massive product or actually intergrate all services into their core, what else is it for that they are spending such amounts of financial assets on these companies. To please the eye for a rehash of the Yahoo brand? One could argue that it would be more wise to _move_ the core to the Tumblr brand instead of reviving Yahoo.
Literally the only thing Yahoo should buy is Twitter. That's fucking it.
Yahoo done fucked up good. They can't make a walled garden, but they could own the public ecosystem. And they could push it beyond Google+ if they did it right.
People use Google for finding things and email. People use Facebook for friends. People use Yahoo out of habit.
The problem is that IFTTT doesn't have a clear business model either. Like with Pipes, you go in, setup a few recipes and then log out, possibly for months. There's nowhere to show ads on, and it doesn't seem compelling enough to get individuals to pay for it.
I've been working out of coffee shops lately. I always look at open screens (yes, it's wrong), and I can't believe how many people have Yahoo open, and some kind of flash game.
Rockmelt had apparently received $40M in funding which it seems likely they were not going to be able to return any time soon. Many of Y!'s recent acquisitions seem "distressed" (not all though).
"We like to do things right and we put a premium on getting stuff done. When it's crunch time, we work crazy hours, pull all nighters, have lunch and dinner in the office, grab a few hours sleep and are back at it."
(from the careers page)
As long as they aren't in crunch time 365.25 days of the year, or of course all that often, it's OK.
In fact, by specifically calling out such a thing as "crunch time", you can ask them "how much of the month/year do you spend in crunch time?", the answer to which should be very telling.
I am trying to find out what problem does Rockmelt solve. Does anyone know seriously?
I found this in an article of theirs: "This feature, called Save Search, will essentially let you make your query results persistent. “We have a patent on this,” says Howes." So is it that they allow you to persist your queries?
The original problem Rockmelt was supposed to solve was having to go to a bunch of different sites to manage all your online social activity. The idea being they'd take Chromium and integrate popular services directly into the browser chrome.
It turned out that nobody actually wanted a browser with social services integrated into the chrome, though. Which should have surprised nobody, since that exact same idea was behind Flock (http://en.wikipedia.org/wiki/Flock_%28web_browser%29), another social-integrated browser startup (this one building its product on Gecko) which predated Rockmelt by five years and which nobody wanted either.
Apparently Rockmelt managed to find some VCs who either hadn't heard of Flock, or who thought using Chromium instead of Gecko would lead Rockmelt to succeed where Flock failed.
Ooops.
(Like Flock, when the "social browser" idea failed, Rockmelt began a series of pivots to try and find something else that wouldn't fail as badly. Also like Flock, they never quite found it.)
You're possibly over harsh here, "social" today doesn't mean the same thing, and itsn't in the same position it was, 5 years ago.
Hmmm, before I'd invest in this I'd like to see research on how many people are seriously engaged in more than 1 and more than 2 social networks. And I'd seriously wonder if that changed for the better in 5 years.
As Andreessen says, “Computing is going to vanish into panes of glass. In the future you’re going to just assume that every pane of glass is a touch computer and it’s connected to broadband. If it’s not active, you’ll assume it’s broken.” And he’s betting that when we reach this world of panes, we’ll be accessing the web via RockMelt."
"The original problem Rockmelt was supposed to solve was having to go to a bunch of different sites to manage all your online social activity."
Thanks, so they needed 40mill to develop and test a value hypothesis. This was very expensive but Yahoo's $65mill covers the cost so at least everyone comes out on decent ground.
Are there any angry users of the old services? People who might say, "I joined your mission as a new venture, and now you're all quitting at once to join a new firm"?
So can someone explain what Rockmelt is? I haven't used it since the private beta in 2010, and thought they abandoned their facebook integrated browser.
"The Rockmelt apps and web product will be shutdown on August 31, 2013."