From The Wall Street Journal:
David Karp has focused on expanding Tumblr Inc.’s network of free bloggers for the past five years.
Today, 55 million of them are posting text, photos and videos on the site. Even Beyoncé and Jay-Z turned to Tumblr’s blogging platform earlier this year to release the first photos of their newborn to the public.
But now, both Mr. Karp, a 25-year-old New Yorker, and his company are heading into a risky new phase: making the site profitable. For the first time, he is making plans to sell advertising and sponsorships to Tumblr’s network of bloggers and their followers.
It’s also a big switch from product development: In the past, Mr. Karp has been critical of Internet advertising, even saying that traditional online ads turn his stomach.
Meanwhile, his long-time mentor is moving on. John Maloney, Tumblr’s New York-based president since 2008, is leaving the firm this month.
The departure will result in some significant changes because, according to Mr. Karp, Mr. Maloney has put “everything in order” at Tumblr, from paying the bills to wooing investors, hiring staff and steering day-to-day operations.
Mr. Karp says he has never worked for—let alone run—a company of Tumblr’s size. He got his start in the tech world at the age of 15, when Mr. Maloney hired him to write computer code for Urbanbaby.com, a parenting Web site.
Mr. Karp later used his share of the proceeds from Urbanbaby.com’s sale in 2007 to start a Web consulting firm where Tumblr was initially a side project.
Tumblr, which was named after Web posts known as tumblelogs, now has 105 employees. It was valued at $800 million last fall, when it raised $85 million in a funding round led by Greylock Partners and Insight Venture Partners.
Mr. Karp spoke to The Wall Street Journal about how he started the company and where he’s headed with it next. Edited excerpts:
WSJ: How did you get the idea for Tumblr?
Mr. Karp: In 2006, the idea of having an identity online that was totally yours was the thing. But the established tools were geared to writers, and I wasn’t a writer. I needed tools to share little glimpses of the stuff that I was working on, looking at, reading, watching. That was the impetus for Tumblr.
WSJ: What made it take off?
Mr. Karp: Six months in, we introduced the ability to follow blogs. Twitter had formalized the follower model. And we’re like, make this a consumption thing, too, not just a content-management system. That changed everything.
WSJ: What’s wrong with online ads, in your eyes?
Mr. Karp: The video ads that we’re hit with are always in the form of pre-roll, the video reel you get at the front of an online video. So they’re delivered at the most frustrating moment possible. And everything else, I think, is strikingly uncreative.
We’ve seen brands show up and use our tools very creatively. Our promotional tools are built around elevating that stuff up to the top more quickly. We were already promoting a lot of this content.
Now, 5% of the time we’re not the ones pulling those levers. The advertisers will now have the opportunity to buy a chunk of that attention.
WSJ: How do you think your bloggers will react to Tumblr with ads?
Mr. Karp: Our ambitions are to keep Tumblr true to what it is. And to us, that’s a platform for creativity.
We want lots of ways to promote yourself on Tumblr when you’ve got something great. You can hustle and do it organically, or you can feed a little money into the system to jump start it.
The next extensions of that are being able to make it stand out even more, having it featured in front of users who aren’t following you yet.