Well, that was fast! After it was first reported at the end of last week that Yahoo was interested in buying up microblogging and social media platform Tumblr for around a billion dollars, the company held a meeting on Sunday to approve the deal, and now its done.
Yahoo has reached a definitive agreement to buy Tumblr for $1.1 billion in cash, it was announced in a release Monday.
Tumblr will remain an independently and separate business from Yahoo, and CEO David Karp will retain his position as well.
"The product, service and brand will continue to be defined and developed separately with the same Tumblr irreverence, wit, and commitment to empower creators," the companies declared. And Yahoo, perhaps sensing that some may be unhappy about this move, promised "not to screw it up."
Karp also tried to alleviate concerns in a blog post celebrating the news Monday.
"Before touching on how awesome this is, let me try to allay any concerns: We’re not turning purple. Our headquarters isn’t moving. Our team isn’t changing. Our roadmap isn’t changing. And our mission – to empower creators to make their best work and get it in front of the audience they deserve – certainly isn’t changing," he wrote.
Both sides stand to see substantial benefits from the deal.
For Tumblr, it will have access to Yahoo's personalization tech technology and search infrastructure, which will give users more access to content.
"Simply, Tumblr gets better faster. The work ahead of us remains the same – and we still have a long way to go! – but with more resources to draw from," Karp said on his blog.
And for Yahoo, they will get access to Tumblr's fast growing network. The deal could be a boon for Yahoo, as is expected to grow the company's audience by 50%, to over a billion visitors a month, and to grow Yahoo's traffic by around 20%.
It now has over 50 million posts, more than 300 million monthly unique visitors, 120,000 signups every day, 900 posts per second and 24 billion minutes spent on site each month.
On top of that, Yahoo and Tumblr both have a plan to increase revenue by creating new advertising opportunities.
The deal is expected to close in the latter half of 2013, but Yahoo has already decided to move its official blog to Tumblr.
"As I’ve said before, companies are all about people. Getting to know the Tumblr team has been really amazing. I’ve long held the view that in all things art and design, you can feel the spirit and demeanor of those who create them. That’s why it was no surprise to me that David Karp is one of the nicest, most empathetic people I’ve ever met. He’s also one of the most perceptive, capable entrepreneurs I’ve worked with. His respect for Tumblr’s community of creators is awesome, and I’m absolutely delighted to have him and his entire team join Yahoo!," Yahoo CEO Marissa Mayer said in the company's first blog post in its new home.
"Both Tumblr and Yahoo! share a vision to make the Internet the ultimate creative canvas by focusing on users, design — and building experiences that delight and inspire the world every day."
Founded in 2007, the New York City-based Tumblr raised a total of $125 million, including a $30 million round in December 2010 from Sequoia Capital, Union Square Ventures and Spark Capital, and an $85 million round of financing back in September 2011 from Greylock Partners and Insight Venture Partners, along with participation from The Virgin Group’s chief Richard Branson, Spark Capital and Sequoia Capital.
And, in case you were wondering what you will get out of this deal, well there's always this fancy gif:
Shares of Yahoo stock are up 1.13%, or 30 cents, to $26.82 a share on Monday.
(Image source: http://mashable.com)