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Tumblr founder to get $81 million to remain at Yahoo
- pinaceae 13y agogood for him. hope he's worth it - founders rarely work well within a corporate environment where suddenly you have people managing you. looking forward to him exiting in a few months/years, then doing something new and cool. should have enough fuck you money by then.
- VandyILL 13y agoDoubt it's about his talent (even though he is very talented). Think it's more of a PR move. It'd look pretty bad for Mayer & Co if he ditched Yahoo in a couple months, and a ton of people would notice / company would get bad press. Keep him & you never have the negative press. Plus the scope of the negative press would dwarf the type of press this blurb is getting. Question is, is the difference between the $81 million and the amount they would have paid him strictly for talent over the course of the contract justifiable on those PR grounds?
- wavefunction 13y agoWell, at $20 million a year that puts him in the company of the 100 highest compensated CEOs (despite being, well whatever his position is.) http://www.aflcio.org/Corporate-Watch/CEO-Pay-and-You/100-Highest-Paid-CEOs http://www.aflcio.org/Corporate-Watch/CEO-Pay-and-You/100-Hi...
- kayoone 13y agoIt is for them. Mayer doesnt want Tumblr to go down the drain and for that to work she needs Karp on board. 80M to keep the original visionary on board seems justifiable given the 1.1B total transaction price.
- cliveowen 13y agoGood for him to be so driven, I would've retired long ago.
- imjk 13y agoWhat about this article has to do with his drive? It's about Yahoo paying him $81MM to retain him for the next four years.
- cliveowen 13y agoThink about it: you spent years upon years building a blogging platform, which I guess pretty much anyone would agree is not that much captivating, and you finally got an exit. And we're talking about Yahoo, with that scale you can be sure that whatever the future needs of the company might be those will be satisfied. Basically you brought the company/platform where you wanted it to be, so $81MM or not I think anyone would be about done with the whole thing. Retire, find some hobby, move on to better things. Yet he remained, so I guess he must be very driven and passionate about blogging, that's all I'm saying.
- shawabawa3 13y ago> so I guess he must be very driven and passionate about blogging Or he just wants to retire in 4 years $80 million richer
- ChuckMcM 13y agoOr take it easy for the next 4 years. A couple of acquired CEO's I met at Google when I was there seemed a bit useless if you know what I mean. Great people but basically putting in their time until their retention clause was met, or at least it seemed that way. I don't discount the possibility that I was just envious though.
- Nate75Sanders 13y agoHow are these contracts usually written with regards to the event of firing? Disclaimer: I fully realize that's not statistically likely at all, but I want any answers to narrowly focus on the legal language in the contract around that event.
- loceng 13y agoI think it's really more just a way to give a bit of incentive to sticking around longer. With the money he now has personally he could do anything he wants - so we can assume that he at least in part wants to keep seeing Tumblr move forward.
- ChuckMcM 13y agoIn my experience even if the retainee is fired they get the whole thing, the retaining company seems to often end up with a clause that says is parting ways is the retainee's idea they forfeit their retention package.
- ojbyrne 13y agoUsually it says "fired without cause" they get the whole thing, but if fired with cause then they don't.
- ChuckMcM 13y agoMy particular package it didn't matter why they fired me but anecdotes aren't data. There was a carve out that if I was convicted of a felony they could evaluate whether or not to pay me. I asked about the firing or not clause to our CEO at the time, and he said, "Oh, they won't fire you, if they want to get out of the obligation they will make you quit." Which I supposed was probably true.
- deleted 13y ago[deleted]
- canistr 13y agoTo me, the most fascinating aspect of the article is the list of Yahoo acquisitions since Mayer joined: July 17, 2012 Marissa Mayer becomes Yahoo CEO October 25, 2012 Stamped (Social Recommendation) December 4, 2012 OnTheAir (Video Conferencing) January 22, 2013 Snip.it (Social Network) February 12, 2013 Alike (Social Recommendation) March 20, 2013 Jybe (Social Recommendation) March 25, 2013 Summly (News Aggregation, Summarization) May 1, 2013 Astrid (Productivity) May 9, 2013 GoPollGo (Real-time Surveys) May 9, 2013 MileWise (Reward Programs) May 10, 2013 Loki Studios (Mobile Gaming) May 17, 2013 Tumblr (Blogging) May 23, 2013 PlayerScale (Online Gaming) June 12, 2013 GhostBird Software (Mobile Photography Apps) June 13, 2013 Rondee (Video Conferencing) July 2, 2013 Bignoggins (Fantasy Sports) July 2, 2013 Qwiki (Automated Video Production) July 3, 2013 Xobni (Address Book Apps/CRM) July 18, 2013 Ztelic (Social Analytics) July 31, 2013 Lexity (E-commerce App Platform)
- jmduke 13y agoPut another way: since March 20, Yahoo has averaged an acquisition every ten days.
- deleted 13y ago[deleted]
- badman_ting 13y agoWell, it's not like the ideas were gonna come from inside Yahoo.
- nilved 13y agoI hadn't heard of a single one of those except for Tumblr. Why are they valuable?
- lotso 13y agoI'm not sure about the others, but Lexity has an actual business model.
- mbesto 13y ago
- ChuckMcM 13y agoIt strikes me that the guy in Minnesota walked away with $86M free and clear from buying a Powerball ticket. :-) Its a pretty nice retention package, always nice to hear when someone 'wins' like this. I hope he continues to innovate going forward.
- tchock23 13y agoI wonder if there is a performance component to this, or if it's based solely on him sticking around for the long haul. I just finished up an earn out with performance goals on both revenue and margin, and found it to be very challenging. We ended up making product decisions with only the near-term implications in mind, and I feel it actually stunted our growth in both the near and long-term. Given my experience, I strongly feel companies should base earn outs on length of time, while giving founders the autonomy to try new things while they are there. I heard Google shifted toward that model over time, but can't confirm. Hopefully Tumblr's founder got similar terms...
- tootie 13y agoYou've just discovered the reason our investment banking system is so screwed up. Earn $20M on your trades this year? Take $500K as a bonus. Those same investments lose $30M the year after? Well, now your bonus is just $30K and maybe you'll do better next year.
- metarev 13y agoThat is dated; deferreds and clawbacks are pervasive now
- craigyk 13y agoI suppose we're just wired to overestimate the value of individuals. I just hope he spends a lot of that money, whereby it might actually do the world some good (rather than 'investing' it) .
- beefxq 13y agoHe'll just buy gold with it.
- mkehrt 13y agoI don't think you understand what "investing" is. Investing is giving money to someone (or even just a bank) in exchange for something which might change value. That person is then going to go spend the money somewhere else. There's pretty much no way to prevent money from moving around other than turning it into cash and burying it.
- ryguytilidie 13y agoI have no problem with him getting 81m. The fact that all of the other employees combined get 29m combined while he gets that is pretty lame though.
- jmathai 13y agoNot really. Karp is worth orders of magnitude more to Yahoo! than the rest of the team. Yahoo!'s always had engineers who could bring products to market. Their deficiency has long been with executives and the product groups.
- kmfrk 13y ago... and Jacob Bijani has left the company. Don't know whether he was offered anything to stay, but he was (is) a huge design talent.
- colmvp 13y agoGut reaction tells me he probably got something small offered but nothing substantial. Designers in tech not named Jonathan Ive rarely get notable compensation.
- colmvp 13y agoUnless you know exactly who each person is on the team, that's making a lot of assumptions. I've seen enough companies that have key people who aren't co-founders that don't get a lot of public recognition but significantly make major contributions to the company. Some would even later become CEOs.
- jmathai 13y agoThat's a valid point. I assume if those key players exist then they received a disproportionate % than other team members. Noting close to Karp though I'm sure. I stand by my generalization though. Yahoo! doesn't need future CEOs. They need founders with the vision to execute on an idea.
- 13y ago
- briandear 13y agoI wonder if he'd be allowed to work remotely.
- tjbiddle 13y agoThe article mentioned that Tumblr would still be run independently from Yahoo in New York (Yahoo is in SV). Fun fact: SV can mean Silicon Vally or Sunnyvale in this case :-).
- beefxq 13y agoWe are all founders now!
- untilHellbanned 13y ago$81 million sounds kinda low for the value of Tumblr.
- coldtea 13y agoErr, that's just the money that the founder got IN ADDITION to the sale, in order to stay with Yahoo. Tumblr was sold for 1.1 billion.
- untilHellbanned 13y agostill think its low,
- timedoctor 13y agoThis move of Mayer and Yahoo to buy a bunch of startups at difficult to justify valuations reeks of desperation. I think it's the continued downfall of Yahoo. If you compare with Google acquisitions each of them are strategic and the aquihire acquisitions are at more reasonable valuations.