Yahoo Paid $30 Million in Cash for 18 Months of Summly Founder's Time - Kara Swisher - Media - AllThingsD
Rohit Khare stashed this in Startups
Stashed in: Yahoo!
Said one person close to the deal, about the founder: “Nick will be a great person to put in front of the media and consumers with Mayer to make Yahoo seem like it is a place that loves both entrepreneurs and mobile experiences, which in turn will presumably attract others like him.”
I believe that Yahoo spent substantially less than $30 million for Summly.
Logically, paying a teenager up-front $30 million in mostly cash makes no sense to keep him motivated since he presumably could quit anytime.
Looking at all the Yahoo acquisitions 2013, deals have been small up-front, big on earnouts.
Jay Yarow reports that Summly only had 500k app downloads and Yahoo is shutting the app down.
To reward lack of engagement with a big up-front payout sends a bad message to the rest of Yahoo.
The money is there, just waiting for clever new moves, said 17-year-old Nick D'Aloisio, who can point to a roster of early backers for his Summly app that includes Yoko Ono and Rupert Murdoch.
"If you have a good idea, or you think there's a gap in the market, just go out and launch it because there are investors across the world right now looking for companies to invest in," he told Reuters in a telephone interview late on Monday.
I don't quite understand Yahoo! PR's strategy on the coverage of this deal – I suppose the simpler explanation is that they aren't controlling the PR (any more than they did on the telecommuting kerfuffle)
They're definitely not controlling the PR.
Check out this healthy dollop of skepticism:
Think SRI will license the technology to Yahoo?
Today we learned that the Summly team also did not build the Summly app — a company called Somo did. Somo is "the U.K.’s largest independent mobile marketing agency."
Acquiring Summly seems to have been an almost incidental side effect of a deal Yahoo made with SRI for a piece of "summarization technology."
A source tells us that Yahoo has "agreements in place" with SRI for "knowledge transfer," and the acquisition of IP, code, and technology.
Until Yahoo bought it, SRI International held equity in Summly.
SRI once held equity in another startup that was acquired by a big Silicon Valley company.
That was Siri, which was funded by SRI International's venture arm, and was later acquired by Apple.
And indeed, inside Yahoo, Summly is called "Yahoo's Siri."
A source close to Yahoo says that CEO Marissa Mayer believes summarization technology is "going to be huge for Yahoo" as it builds "personalized news feeds" into mobile versions of its "core experiences," including Yahoo Finance and Yahoo Sports.
Yahoo believes summarization technology will be especially important because phones have much smaller screens than the desktop computers where Yahoo products are mostly used now.
The job of implementing this technology at Yahoo will not be given to anyone from Summly, including its young CEO.
That task now belongs to Yahoo's mobile organization, run by Adam Cahan.
…programming whiz who wasn’t even born when Yahoo was founded in 1994, sold his news-reading app, Summly, to the company on Monday for a sum said to be in the tens of millions of dollars. Yahoo said it would incorporate his algorithmic invention, which takes long-form stories and shortens them for readers using smartphones, in its own mobile apps, with Mr. D’Aloisio’s help.
“I’ve still got a year and a half left at my high school,” he said in a telephone interview on Monday. But he will make arrangements to test out of his classes and work from the Yahoo office in London, partly to abide by the company’s new and much-debated policy that prohibits working from home.
Hold on a second.
FIRST Yahoo institutes a policy where no one can work from home because culture is important.
THEN it lets a major acquisition work out of a satellite office while finishing high school?
Somewhere in all these maneuvers, consistency has been lost.
The New York Times says he wants to get into Angel Investing.
So much for focus.
It seems that the $30MM is somewhere between a wild stab in the dark and a detailed estimate made from combining a spreadsheet, tarot cards and tea leaves.Presumably the real number is a rediculously large amount but ask yourself, if you were a superstar who has valid reasons to think the world is at your feet how much would it take to get you to tether yourself to Yahoo? Would that number be even larger if you were a preschooler when Yahoo was cool and your only mental picture is bloated, cadaverous 2013 Yahoo?
I don't know where his confidence came from. There's no evidence that the world was at his feet.
http://hackingdistributed.com/2013/03/26/summly/ got a fun discussion going on HN — even the NLP "sauce" came from somewhere else (in this case, supposedly SRI).
Vibhu Norby of Origami: "The craziest thing is that there are a lot of really qualified, CS-beefy teams doing really amazing things in the mobile news/discovery space these days - and that would definitely take a $30m acquisition offer or less. I don't really understand why they picked this one."
There's no supposedly about the SRI link. It's right on their website http://summly.com/technology.html
The kid has game. I've no idea how good the tech is, or if Yahoo even wants it.I assume they are spending cash (that they have plenty of) to try to buy youth and hipness (that they have none of).
They spent $100MM in the same quest on that "The internet now has a personality. Yours" advertising campaign a couple of years ago and convinced exactly nobody. Even if this plan is just as doomed it was at least cheaper.
Wow, that's truly awful. Thank goodness they stopped running that campaign.
We're coming up on the 1year anniversary of Postrank by Google. I think people are so shocked by Summly, but they're really behind the curve.
Wait, what's Postrank?