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by orky56 4709 days ago
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.

4 comments

It should be noted that "win" is a relative term in Rockmelt's case, since there was only a $60-70M return on a $40M investment.
Fair enough. However for what is believed to be an acqui-hire and a team that has some lofty ambitions, I think the founding team and investors must have been happy that the team/product found a nice home.
RIght. But this would never been termed a win by any VC. Perhaps the earliest founders.
Wouldn't the VCs have had preferred stock and gotten liquidation preference before the earliest founders?
Have they acquired any companies that were 100% bootstrapped?
Playerscale is the one off the top of my mind that was totally self-funded.

In addition, I could not find funding data on a few others when completing my research so not sure if self-funded or not: Alike, Loki Studios, GhostBird Software, Rondee, Ztelic

This acquisition reminds me a lot of Hunch. It's a similar size in terms of team + cost per team member. $2-3M/employee. And, Hunch's core tech seems to have gone into the eBay homepage, which is what Sarah is proposing Yahoo do with Rockmelt.
That's true of Hunch at eBay, though it should also be noted that the new homepage was originally spearheaded by Milo employees, an acquired startup that also is creating new products in eBay (read analyst day reports and look for "eBay Local" for hints).
Why can't you poach employees for less than $2M each?
Other than Tumblr, it seems like all the other acquisitions were of companies that were on their way down.

Edit: Also add Lexity to the list with Tumblr.

That doesn't seem totally fair. To say they were on their way down is pretty negative. Sure maybe some of their explosive growth was slowing down but I know more than a few still had some tricks up their sleeves. Outside of Tumblr and Lexity, Astrid and Summly were poised to continue to innovate since the founders/team have products that continue to surprise.

At the end of the day, some of the startups are by founders who are pretty early in their careers (e.g. Summly) and would like to have a win under their belt. Yahoo's shopping spree seems to validate a lot of successful products not just in terms of popularity but also talent and product innovation.

Lexity was a rumoured $30 - 40m (AllThindsD) on $6m in funding with the business remaining active.
Lexity also had a business model and were solving a legitimate problem.