$75M is a lot of money any day, but while a few years ago it seemed like a small exit, today it’s actually a very high figure, especially for the Web 2.0 variety of startups that are built on low funding, such as Stumble Upon.
eBay bought SU a couple of years ago for $75M, and if you believe the rumors, the company is looking to unload it, but is seeking the same amount.
Few companies will fetch $75M these days, especially a social media one, which does not really have the DNA makeup advertisers want.
There are way too many social bookmarking / social news services out there. Even the so-called Cadillac of them all, Digg, has been unable to find a buyey: not at $150M (News Corp.), not at $200-300M (Google). It recently raised nearly $30M, allowing founder Kevin Rose to cash out a bit. Ultimately, I think Digg is a cool site, but with MSFT providing the bulk of its revenues, the company is stuck between a rock and a hard place.
Initially I thought someone like CBS might like these social media sites, but CBS can simply take Last.fm’s underlying music recommendation technology and duplicate it for websites as a recommendation engine, which is essentially what SU is and does. The thing is: I think we are seeing the floor fall from under these social media sites anyway, look at CNN’s iReport false report that Steve Jobs had a heart attack; then look at this image of a threeway lesbian orgy in the middle of a street, uploaded to CBS’ citizen journalism venture and you start to get the idea: marketers don’t touch this with a ten foot pole… speaking of poles, did I mention the three lesbians getting it on here?
Separately, this also raises another point: lightning does not strike twice, let alone thrice. Sure, eBay’s $1.5B acquisition of Paypal was brilliant, but its acquisitions of both Skype and SU have been anything but.
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