Yahoo to Pay Tumblr's David Karp $81 Million to Stay for 4 Years

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By Lauren Indvik2013-08-09 20:56:09 UTC

Yahoo filed a 10-Q report with the SEC Thursday, disclosing some additional details about the 10 startups it acquired between the end of March and the end of June — including its biggest one, Tumblr, which cost the company around $1.1 billion.

The filing also reveals Tumblr CEO and founder David Karp's compensation package. In addition to the estimated $250 million in cash and $29 million in stock he received for selling Tumblr, he'll also receive a salary of $10 million a year and an additional $41 million worth of stock if he stays on with the company for four years. (Note that the $41 million is current value of the shares, which could go up or down by the time he receives them.)

See also: The 20 Startups Marissa Mayer Has Acquired at Yahoo

In addition, the filing reveals just how strapped for cash Tumblr was by the time it sold to Yahoo. Of the $85 million it raised from investors in September 2011, Tumblr had just $16.5 million left. Tumblr was likely feeling pressure to raise more money, and was no doubt having a hard time during the company's lackluster ad performance. Yahoo's offer may have come just in time.

Yahoo's other acquisitions during this period were comparatively modest. The filing shows that the company paid $54 million in total for nine startups, which, based on their announcement dates, we believe include Summly, Astrid, MileWise, GoPollGo, Loki Studios, PlayerScale, GhostBird Software, Rondee and Bignoggins. (We have reached out to Yahoo to confirm.)

Estimates stated that Yahoo paid around $30 million for Summly, and either that figure was too high, or the other eight startups averaged about $3 million apiece.

Image: Andrew Burton/Getty Images

Topics: Business, David Karp, Startups, tumblr, Yahoo