Tumblr Was Pretty Screwed Before Yahoo! Stepped In
AllThingsD's Peter Kafka reports some glum news from a recent Yahoo! financial filing: when the confused internet portal sealed its deal, Tumblr has only $16 million in the bank. That's a lot to us, but peanuts for one of the most popular sites on the entire internet.
This is only further evidence that the Yahoo! buyout isn't really what anyone at Tumblr wanted—it was a matter of necessity. Payroll plus operating costs would've eaten up that $16 million in not much time, since since Tumblr rather proudly made squat for revenue, it would've had to find even more investors, or hunt for a suitor. We see which desperation option it picked—and why.