In this week’s newsletter, we will talk about the success story of Tumblr and its founder David Karp. How David started Tumblr and how it became one of the most popular microblogging platforms in the world.
All this has been possible only due to hard work, passion and persistence. Let’s see how!
Success Story of Tumblr – from Publishing to Microblogging
Tumblr is an America-based platform used for microblogging and social networking. Users can write blogs and post images, videos, and other forms of media. They can also interact with other users and follow each other.
When we try to differentiate between blogging and micro-blogging, Tumblr is kept on the micro-blogging side with Twitter and Facebook. But in reality, Tumblr is actually a combination of status bursts of such social media platforms and the blog form of WordPress. It is termed a microblogging site as you can write blogs and posts and insert multimedia like images, videos, links, etc. Tumblr started in February 2007 with art, media and adult content. It had a tagline Blogging made easy.
Tumblr lets you express yourself – that is its major positive point. Seven types of media can be uploaded –
All these can be done with just one tap on the dashboard, that will upload them to the public platform. Users can design these blogs according to their wish or a given theme, such as the Redux, that has 3 million users. Tumblr is a free platform, so you don’t really have to pay to use its features. However, Premium themes are offered, meant for account users. Though they are generally free, there are features available that you can purchase at prices in the range of $19 – $49.
Tumblr is easy to handle and operate, both as a microblogging platform as well as a social network. When users follow other Tumblr users, their content comes up in their dashboards, similar to Facebook’s newsfeed; with the reblog option users can post others’ blogs to their own dashboard. “The social network that emerges out of Tumblr is interesting because it’s driven by content, not by the social graph that these other networks are building around,” says John Maloney, the president of Tumblr. On average, a Tumblr blog gets reblogged nine times – which is a sufficiently high number.
David Karp, the founder, was good at studies and learned HTML from the tender age of 11. He soon started to create websites for various platforms and businesses.
Karp’ desire was to complete his graduation from MIT. For this reason, he chose to drop out of school and improve his resume by doing homeschooling, after studying at The Bronx High School of Science for one year. Things don’t always according to plan. He interned at the Frederator Studios at the age of 14, where he developed various software programs, including the first blogging platform of the company and its first virtual video network called Channel Frederator. He was also learning Japanese and improving his mathematics. From his mathematics tutor, he learned programming.
When he was 17, David shifted to Tokyo and work in UrbanBaby, an online platform for giving parental advice. It has a message board consisting of urban-dwelling moms and dads, which attracts huge traffic. He gained the attention of John Maloney, the founder of the company, when he repaired a bug in the software in a short period of time. Karp was appointed as the product head at UrbanBaby. Working in the company for four years made him give up the dream of joining MIT, as he was getting interested in programming and did not have a high school degree yet.
Karp was one of New York’s youngest tech experts, and established his development consulting company, Davidville. A programmer, Marco Arment, was recruited by him to assist him in his new project. Karp had become interested in microblogging, taking inspiration from existing blogging tools, and wanted to design a platform for this purpose. He decided to pursue his interest and passion and after one and a half year, he opened Tumblr for the public in February 2007, when he was 20. Before that, in October 2006, the pair created a simple private version of Tumblr using coding and programming, that was only meant for Beta users.
The pair worked hard and efficiently, but their clients were displeased due to their halfhearted approach of management. “Operational experience, making appointments, returning emails, things like that: I sucked at it,” admits Karp. “They loved what we did, but hated working with us.” The situation got worse that Karp and Arment had to take a break for two weeks between contracts. Karp told Arment, “I’ve got enough of a vision of this thing. Let’s see what we can put together in the two weeks before our next gig.”
Karp wanted instant opinion when he disclosed information about his life, without wasting much time, like other blogging platforms. He also wanted others to realize the benefits of posting through Tumblr. Though David Karp knew its potential, he did not expect his website to obtain 75K users in less than two weeks. After six months, he realized the bright future and prospect of Tumblr, and so closed down his Davidville and restructured his company as Tumblr, Inc. “The one really cool thing was we could let you change anything about its theme,” states Karp. “It was just a big chunk of code you could rip apart and make original. And it attracted this spectacular community of designers and hackers. Over the next few weeks, they built gorgeous things on Tumblr that didn’t look like anything else on the internet. That still defines Tumblr to this day.”
“All blogs took the same form,” he stated. “I wanted something much more free-form, much less verbose.” Though people wanted to speak out and give out their opinions through blogs, all existing platforms created for this purpose were complex for the layman. “These tools I just don’t think worked for most people. It’s a commitment, you need to sit down for an hour and hammer out a post.”
He also says “WordPress is the best tool in the world for that kind of publishing”. But it was not suitable for someone who didn’t like to write. Karp wished to share his opinions in the form of a blog, but in vain, as he could not find the correct platform. His problem was: “I’m not a writer. I can’t write. I don’t enjoy it like [prolific bloggers] John Gruber or Jason Calacanis do. But I do have things to share.” Even WordPress, Movable Type, and Blogger failed – they could not motivate him, because of “that big empty text box.” “I said, alright, I’m going to hack my own tool,” he then decided.
Tumblr was created to eliminate this problem – you could express your thoughts and opinions in much less time, with much less effort. He decided to remove the text box and create a button which were meant for each type of multimedia, and could be used to upload all types of content in a hassle-free way. “The thought was, we’ll use their forms and expose that particular form whenever you want it.” This was different from Twitter and Facebook, which many don’t understand. “They do, but they lack a strong expressive identity,” states Karp. “They are not tools built for creative expression. Nobody is proud of their identity on Facebook.” Tumblr is concerned with its design, and you have the scope to modify your Tumblr profile as per your personality, unlike Twitter and Facebook, since “expression isn’t necessarily something they care about.”
Karp wanted to earn his income by means that “enhance the experience for our users.” You have to pay on Tumblr for being featured in its directory or for buying themes to make your Tumblog appealing. Though many theme designers were earning lots of money per month, they were merely ancillary revenue streams for Tumblr, as opposed to its main source of revenue. Karp, luckily collected $30 million funding, thanks to his investors, who were patient enough to give him time to expand the company and determine a better and suitable business model.
All these challenges “had absolutely slowed down the product roadmap,” Karp agrees. But he and his team worked day and night to keep the business running, improve existing features and introduce new ones.
Karp also thought of developing a startup in New York taking inspiration from giant media conglomerates, and had realized that it presented Tumblr from a different point of view, as if it was based in Silicon Valley.
Despite such innovation, Karp did not come up with tumblelogging, that is short and quick blogs on Tumblr. It was actually launched as a trend by anarchaia.org, created by Christian Neukirchen, a 17-year-old student at high school in South Germany, in 2005. Neukirchen defined it as “experimental, impressionistic sub-paragraph tumblin’ (think obstsalat),” where Obstsalat means fruit salad in German. Length of editorial content had to be less than a paragraph – this was the one and only requirement. The term tumblelog is a combination of tumble and weblogging, that perfectly describes Anarchaia.
Other similar platforms soon cropped up, with similar features like quotes, links, graphics, etc. “It was kind of a return to the old approach to blogging,” states Karp. “Everybody had this page you could just dump stuff on. And it was so much more beautiful than blogs at the time. Tumblr started as something I wanted to use myself.”
People from all backgrounds and fields express themselves through Tumblr. Danah Boyd, senior researcher at Microsoft Research specialized in social networks, is one such individual. She says: “I saw people who were frustrated with Facebook at not being able to express themselves. Tumblr became a powerful complement to Facebook. It didn’t require the heavy-handed ‘we must be friends’ that is so ingrained in Facebook.”
Karp did not have think of revenue in the initial phase. “I’m all for turning this into a big successful business,” he says. He believed that with time, Tumblr could earn lots of revenue, from various sources. He has a two-directional strategy: promotion through blogs and a huge marketplace like App Store.
Tumblr has experimented with the first, charging individual users, as well as corporates, to push themselves up the directory. “There are no current platforms for creators to promote themselves,” stated Karp. “There aren’t those platforms for driving attention to creative works and media.” Tumblr is a platform where artists and their fans can express and promote themselves, or any product they endorse. Karp made these features expecting them to be earning huge money in 2013.
The design like App Store was already earning revenue. Premium blog designs, that costed around $49, were a primary source of income, from which Tumblr cut a percentage ranging between 20-40%. It actually amounted to millions of dollars per year, and was sufficient to cover a small part of the variable costs. Karp states that there are some theme designers who are earning huge income. “Right now, it’s limited to blog fashion — how it looks,” he said. “There is no reason why it can’t extend to blog function, where we let developers introduce new functionality. I think of that as the last feature we ever build — we introduce the platform and then the developer community takes over.”
But what could be the reason for such high valuation of Tumblr? “Will they have a cashflow that justifies that number, or will someone buy it for that amount?” Charlie O’Donnell asked. “For a big acquirer looking to get more social, I’m not sure how they would integrate it in a way that makes it more than the sum of its parts.”
There is a good justification for this also. All the features co-existed on the Tumblr dashboard, that gives life to the entire experience. Millions of users experience using the dashboard and follow the blogs of each other on Tumblr, spending hours on it. This results in a higher session time than Facebook, right after YouTube. The team however strives to find more ways to improve the dashboard.
More important than making users is making sure that potential customers are ready to buy your product. For this purpose, advertising, particularly brand advertising, is most efficient, that brings in new customers and retain the existing ones. This provides the perfect opportunity for Tumblr, that is a media network. The platform is related to creative content and attention. So, companies and brands can make their own content, combine them with other amazing content existing on Tumblr and use them for advertising. These products are the one that sells the most and earns maximum revenue. Tumblr displays such content on its dashboard and marketers can own 5% of it – that is just a small portion – to gain attention of customers through their creative content.
By March 2013, Tumblr users were uploading 10,000 posts in one hour. Karp and Arment consulted about the platform. The variable cost amounted to about $5,000 per month, so the two decided to take funding from angel investors and venture capitalists. In October 2007, about 25% of the company shares was sold to Spark Capital, Union Square Ventures. It was also purchased by Betaworks head John Borthwick and Vimeo founder Jakob Lodwick, making the total amount equal to $750,000, and taking the valuation of the company to $3 million.
Karp realized that online art galleries, meta webcomics and many more were engaged in Tumblr. But the problem lied in discovering new tumblelogs. Users organized everything themselves – from writing posts to posting the list of all accounts on their dashboard, after collecting addresses from other Tumblr users. “They were hacking the network,” stated Karp. “Even though they had no tools at all, they were finding each other and drawing these lines between each other.” Users came into each other’s contact based on mutual interests, that were decided from the media posted, such as images and quotes. A network was built in this way!
The directory feature of Tumblr divided blogs into groups, based on tags assigned to them. Even non-members were permitted to surf the website. Karp and Arment themselves selected interesting blogs, using RSS readers, to establish Radar – an important feature of Tumblr. “We realised, man, RSS sucks for Tumblr,” said Karp, “because RSS was designed for hokey old traditional blogs.” The dashboard was one feature that could solve this problem. “All the stuff I wanted to blog was on my dashboard. The reblog button mechanised viral stars on Tumblr,” says Karp.
Users formed communities around ordinary topics such as cycling and technology, following and reblogging each other’s post of common interest. “If you think of Facebook as being a strict friends’ network, Tumblr is a strong interest network,” says Boyd. “On Facebook, it’s a DNS [domain name system] for people. Tumblr is a place to share and communicate.” Charlie O’Donnell, a venture capitalist is of the opinion that Tumblr has now become more than just a platform for publishing. “What’s really exciting is the interconnectedness, the community. It makes blogging in other places kind of lonely.”
The unique feature of Tumblr is that you can upload anything you want, in your own way. Tumblr will format your blogs such that it appears in a nice way in your dashboard, not compromising with quality and your choice.
Tumblr’s API (application programming interface) allows you to take your blog, share and upload it anywhere on the internet. You can upload your content into any other website, create your own domain and use the data in any way you want. This makes Tumblr one of the most flexible platforms to publish content of users.
Tumblr does not have any separate marketing strategy. It utilizes its own user base – people who have achieved great heights through the platform – to make the other users realize the importance and utility of this platform, hoping that their good feedback would bring in more users.
Apps for Tumblr were soon established, an iOS app in 2009, and for Blackberry phones in 2010. In 2011, Tumblr approached the Valley for funding, as the existing funds was not enough to cover the cost of the large number of users. The company soon reached a valuation of $800 million and raised a funding of $85 million.
In October 2011, President Obama campaigned for his 2012 re-election on Tumblr, asking users to express their opinions and posts as a symbol of huge collaborative storytelling effort. Six months prior to that, the US State Department established the official US Department of State presence on Tumblr, posting videos, links, and articles. Major media channels like Newsweek, New York Times, BBC, fashion houses including Alexander McQueen, Oscar de la Renta, and big tech companies such as IBM and Olympus have accounts on Tumblr.
Tumblr 3.0 was launched in 2012, that contained additional features such as support for Spotify. Users could now upload HD pictures and also use an offline version of the platform. In August 2012, advertisements were used to make money and raise revenue.
In 2013, Yahoo! announced that it had planned to acquire Tumblr for $1.1 billion, with Karp as the CEO of the company. However, Karp gave up his post after four years of working for Yahoo!.
David Karp became the Best Young Tech Entrepreneur by BusinessWeek in August 2009. He also appeared in the list of top 35 innovators in the world under the age of 35 in MIT Technology Review TR35.
The secret to Tumblr’s success, including billions of pageviews across its networks and 0.25 billion pageviews per week at that point of time—is the hassle-free way in which you can post something and reblog the posts of your friends. Though the company was not ready for such rapid growth, Karp and his team worked day and night to grow, develop and meet the shortage generated from the excess demand.
The design and success of the platform was unexpected, caused by how technology evolved, and thus the product changed in a positive way. There are various features that made Tumblr successful. Tumblr started as a platform for publishing novels and blogs, in contrast to traditional platforms depending on editorial publishing. Tumblr is much more based on real time. In the initial phase, its slogan was everything you find, love, hate or create. You can find anything you want and write anything you think – no editing or publishing needed.
“Making money off of Tumblr would be incredibly easy,” David Karp stated. If all members have a simple AdSense advertisement on their dashboards, it would fetch Tumblr high revenues.
The growth of Tumblr was impressive from the start – its user base grew by 900% till June 2011. In about 2 years, its page views increased from less than two billion per month to about 14 billion, that is higher than Wikipedia or Twitter. Nielsen stated that it was UK’s second most popular blogging and social network platform in the third quarter of 2011, right behind Facebook, fetching 229.6 million page views.
Tumblr raised more funding from Union Square and Spark, who were the first investors, amounting to $9.5 million, from a couple of rounds. This was done as it contained seven million blogs in January 2010. After that, in November, Silicon Valley approached them, but it was too late. “They were not paying attention because we were out here [in New York].” Karp brought back $30 million from Sequoia Capital in California, which was famous for investing in YouTube, Google, PayPal, Apple, Yahoo, etc. “I stepped back thinking the stakes are pretty high,” stated Karp. “Part of being a [then] $100 million company is really taking things seriously.”
The platform hosts 518.7 million blogs on its site, as per data released till February 2021. About 12.8 million blogs are posted on a daily basis. (Source – Tumblr, 2021). It has also achieved more than 32 million bloggers, who are US residents. (Source – FirstSiteGuide, 2021).
Though Tumblr has not released any financial data in the public after 2013, the annual revenue can be estimated at an amount of $65 million, assumed to increase by 55% since July 2021. The source of this revenue is mainly from:
- Sponsored Posts
- Sponsored Video Posts
- Sponsored Day
- Premium Theme Sales
Karp was of the opinion that to grow and develop more, he had to expand his team and recruit more members. At that time, Tumblr had about 14 members in the team. But then his misconception was eliminated after a talk with Mark Zuckerberg, the founder of Facebook. “Mark talked me down from that. He said, ‘Well, when YouTube was acquired for $1.6 billion, they had 16 employees. So don’t give up on being clever.’ He reminded me you could make it pretty far on smarts.”
When Marco Arment, the former co-founder and lead developer, left the company to dedicate his time completely towards his new project, Instapaper, Karp did not break down. Neither did he give up his dreams. He recruited an entire team comprising of engineers having operating experience, and experts who specialized in the technical side, that was left unattended after Marco left. “He and I were in over our heads but we’ve now brought in a team of nine engineers, who have done this before and know how to design an infrastructure that can scale to this level. They’re brilliant at this type of systems architecture and they’re doing a spectacular job.”
The entire team loves to work at Tumblr – it’s because of learning and experiencing new things while developing some new tool or some feature; just like how an artist expresses himself on an empty canvas, using new colors. Tumblr offers extraordinary tools that would not be available on other platforms – you can make things that you could not otherwise. Spending long hours developing a new feature, improving it and then launching it, just to see how the public appreciates and uses it like their own, gives a truly satisfying feeling. However, Karp never had any plans to sell Tumblr. He is not running behind money. He had always wanted to develop his platform, taking it to even greater heights. He wanted to work and remain employed in the company even after decades and earn income solely from this.
Such is the end result when you choose not to give up. Even without high educational qualifications, hard work and patience can fetch you sweet fruits of success in just a matter of time!