How David Karp built a website and made $200m

published 24 May 2013

High-school dropout, 26, worth $200m after selling his company to Yahoo! professes to be uninterested in money. Self-taught coder wears sneakers and hoodies and concludes memo announcing the billion dollar takeover of his company with a characteristically informal sign-off, "F*ck yeah, David".

We've heard the precis many times before, says The Independent. But is there anything different about David Karp and his blogging site Tumblr that marks him out from other youthful tech prodigies in the "21st century's most exclusive club"?

For a start, he's a New Yorker with no inclination to be linked in with the "cookie-cutter world of Silicon Valley". At a TechCrunch Disrupt conference this month, he praised New York as a home for start-ups because at least not everyone is wearing a "Dropbox or Airbnb shirt".

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There's also a difference in approach. Karp talks about his website in "the same evangelical terms" as Facebook's Mark Zuckerberg. But while the latter preaches Facebook's "mission to make the world more open and connected", Karp (in keeping with his status as a resident of boho mecca Williamsburg, Brooklyn) describes Tumblr as "a platform for creativity".

In an interview with The New York Times last year, he said he detested the usual numerical markers of "popularity" used in social media, such as "follower" and "friend" counts, because they can "poison a whole community", adding: "the last thing we want to do is compete with someone. That's for bankers."

The son of a TV composer and a teacher, Karp's digital education began at 11 when he taught himself how to code from HTML for Dummies and was soon building websites for local businesses. With his parent's blessing, he dropped out of public education at 15 and was home-schooled. His first significant job was at UrbanBaby, a New York version of Mumsnet.

At 17, he went to Japan and tried to bluff his way into tech consulting jobs, says The Guardian. "The experience was a rite of passage." He returned to the US and formed the consulting company Davidville, which in 2007 became Tumblr.

Karp's touchy-feely attitude to social media and penchant for public swearing may be a sign that he's still comparatively new to the "cyber-mogul" game. But some see similarities between Karp and the late Steve Jobs, says BusinessInsider.com. "Karp is his product. He's design-focused and he's stubborn when it comes to the vision for the company [see below]."

He is also obsessed with simplicity. His Brooklyn apartment, as Forbes notes, takes minimalism to a new level. For Karp it's about freedom; he always travels light, making plans only a few days in advance. One of his few indulgences is motorbikes. "It's my James Bond fantasy, wanting to be perfectly mobile." It will be interesting to see if Yahoo! can contain him.

A "shoot the moon" gamble to save Yahoo!

So what's the attraction of Tumblr? asks Matt Warman in The Daily Telegraph. Its core users tend to be an arty crowd, producing an eclectic mixture of entertainment and ephemera. "It's an online scrapbook that boils the web down into what Tumblr's users think are the most interesting bits."

Ease of use and simplicity was a big factor in the site's early popularity among bloggers, says James Vincent in The Independent. Latterly, users have come to prize its integrity. "While Zuckerberg is often portrayed as coldly pragmatic, expanding Facebook at the cost of users' privacy, Karp's ethos seems gentler."

The $1.1bn all-cash deal is the first big move to revitalise Yahoo! by Marissa Mayer, the ambitious ex-Google chief who joined the ailing internet veteran last year. But the deal has gone down like a lead balloon among independent-minded Tumblr users, who, as Slate.com observes, see it as "a death knell for their beloved site".

In its acquisition memo, Yahoo! promised "not to screw it up", says Joshua Brustein in Businessweek a nod to its "reputation for ruining start-ups it acquires", including the photo site Flickr. Mayer views the loss-making site's 300 million youthful users as a "future growth engine", says Andrew Ross Sorkin in The New York Times.

But to justify the price, annual sales need to rise to $950m from $13m now a tall order given the risk of alienating users (and Karp, who is staying on) with heavy-handed advertising. Quite how Tumblr's sizeable porn community will fit in is a conundrum. "This is a shoot-the-moon gamble."

Three cheers to Mayer for at least saving Yahoo! from "a spiral into irrelevance", says Jeffrey Goldfarb on Breakingviews. Yahoo! was "little more than a purple road-kill stain on the information superhighway" when she joined; the shares have since soared 70%. "Tumblr puts all the hype to the test." Win or lose, this deal "goes a long way to restoring the faded and vainglorious exclamation point" on Yahoo!'s name.