Tumblr's Growing Pains

By Dana, Rebecca | Newsweek, May 7, 2012 | Go to article overview

Tumblr's Growing Pains


Dana, Rebecca, Newsweek


Byline: Rebecca Dana

The company plans to cash in. But will 53 million bloggers agree?

If only buzz were revenue, Tumblr would be bigger than Walmart.

The coolest people on the planet use the five-year-old blogging and social-networking site. Every time fashion photographer Terry Richardson invites a dewy supermodel to pose in her underwear, the pictures go right up on his outpost in the Tumblrverse. The Obama administration has a Tumblr, as blogs on the site are called, as does the cutest of the Jonas Brothers. When megastars Jay-Z and Beyonce were ready to show off their newborn daughter, they bypassed news outlets and posted pictures on their blog.

What makes Tumblr appealing is a combination of ease and aesthetics. When you sign up, you create your own personal Tumblr, where you can post thoughts, images, links--just like any blog. The site also performs a social-networking function: like Twitter or Facebook, at Tumblr you follow other blogs, and they follow you. But Tumblr distinguishes itself as more of an aspirational social network, a place you go to hang out with the people you wish were your friends. Unlike Facebook and Twitter, the site's homepage is not a drab login but an artistic posture: it features a range of high-resolution artwork; one day this month, its top images were an illustration of "Spring Snow" by the late children's author Roger Duvoisin and a series of bleak landscapes by Danish photographer Per Bak Jensen; its tagline is "Follow the World's Creators."

And yes, by joining, you become one of the "world's creators" too. The site now hosts about 53 million blogs, which include teenage diary-type opining, video clips from aspiring auteurs, and many, many pictures of cats. It's an entire universe of people trying to build their personal "brands"--and it's all free.

But every kid must hit adolescence, and every successful startup must eventually try to monetize. This week is Tumblr's turn. With its costs growing rapidly, the company on May 2 will launch its first major revenue scheme, allowing some users to pay for placement on the site's main page, which could be seen by Tumblr's 110 million monthly visitors.

Many sites have tried to ease users into a new world order where not quite everything is free. Users either embrace the change or they whine and, sometimes, flee. But Tumblr's move will not just test the loyalty of its fans or the talents of its founder, 25-year-old Internet tycoon David Karp. If successful, it will provide a way for brands to connect with consumers that is more nuanced than your average Internet ad. It would also delight investors, who have poured more than $125 million into the Manhattan-based company, and provide more oomph to the New York tech community, which is growing up right alongside Tumblr.

Karp admits his company has been burning through cash to keep its growth on track. Choosing when to turn on the profit engines is never clear, but Tumblr had to do something. "We all feel the same pressure," Karp says one sunny afternoon about the feeling at the company. "The numbers are starting to get unforgiving."

Once, around six years ago, Karp's mentor, Fred Seibert, gave him some tough love. Karp had begun working for the television and film producer after dropping out of New York's prestigious Bronx High School of Science at the age of 15. He had taught himself how to code, and his parents homeschooled him while he worked for Seibert and built Davidville, which he called "an invention company." Seibert helped him get his next job, as the chief technology officer of UrbanBaby. After Karp cashed out, in his late teens, Seibert offered some unsolicited advice. "He thought I looked like a chump because I was wearing a tie too often," Karp says. Doogie Howser, M.D., wore a tie every day; a tech boy-wonder also had to dress the part. (Karp now sticks to hooded sweatshirts and jeans. …

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