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Comment by majani | Hacker News Reader

After Marissa Mayer came in, I read that their acquisition strategy became to buy distressed companies with talent on the cheap. This fits that description.

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It sold for ~30 mil, not really on the cheap for a 10 person team

I had this originally pegged at a acquihire on the sub $5M range. I wouldn't be surprised if getting to $30M requires some heavy rounding and a massively successful earn out of some kind. If it was $30M, then I think I'd want his VCs in my next round, because that is an amazing feat of corp dev.

The rumor is that they were raising another round at a big valuation which might explain this. They might have been play off Yahoo and the VCs looking to lead the round off each other. Still, a really high number for an app that doesn't seem to have much traction.

So my best guesses are: 1) $30M is basically a BS, "maybe they can get it in some crazy situation number" 2) $30M number is not real at all 3) They had some technology that was patented, hard to build, and was perceived to be super valuable to Yahoo but not obvious from the app itself 4) Something about having this "wiz kid" was really important to Yahoo's image

And it was definitely not: -the product (being shut down) -much of the team (only 3 are going with)

The lessons from (1) and (2) would be don't believe everything you hear. The lessons from (3) and (4) are that having great corp dev resources (VCs, advisors, etc) are worth a whole lot.

I agree. I really don't see the value beyond a few talented search engineers. They lost a lot of people with similar skills in the last few years. Nonetheless, this is a massive premium and I am not sure where the return on this investment will come from.

By way of update, word is that only 3 people, including Nick, are going over to Yahoo!. If this is accurate, I am unclear on the long term value of this deal.

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