When Yahoo acquired Tumblr back in May, it seemed like a natural fit in a lot of ways: It added an influx of younger, cooler customers to Yahoo, and it gave Tumblr the lifeline it needed when advertising revenue wasn’t yet booming.
But how desperate was Tumblr’s financial state at the time?
A new 10-Q form that Yahoo filed with the SEC on Thursday, first noted by AllThingsD, revealed that Tumblr had just $16.6 million in cash left when it was acquired by Yahoo, even though it had raised $125 million since 2007, most recently $85 million in 2011.
Since Tumblr generated just $13 million in advertising revenue last year, as CEO David Karp had said previously, and was still figuring out how to achieve advertising success on mobile, the company would have likely had to start fundraising again if Yahoo hadn’t stepped in. At the time of the acquisition, Tumblr had 178 employees.
But now that he’s with Yahoo, the deal doesn’t look bad for Karp — if he sticks with the company for four year, he could earn up to $80 million in cash and stock over that period of time.
Updated at 5:16 PM to reflect Karp’s retention package as $80 million.