High-flying startup StumbleUpon has been rumored to be in acquisition discussions since at least last November. Recently we’ve heard that talks have heated up again, with Google, AOL and eBay as potential suitors. A source with knowledge of the deal now says the company has signed a term sheet with eBay to be acquired. The price is somewhere between $40 – $75 million. (update: GigaOm is now reporting the price at $40 – $45 million).
StumbleUpon lets users rate websites via a browser toolbar. At any time a user can click “Stumble!” and will be taken to a website highly rated by other StumbleUpon users who tend to vote in a similar way as the person “stumbling.” More often than not, it’s something almost serendipitously interesting to the reader. The company expanded into video referrals in late 2006.
People who are passionate about StumbleUpon say they like it because of the surprise factor in what they see next, and the fact that the product has such a high hit rate in delivering interesting new content. The StumbleUpon site says they have 2.1 million users, up from 1.7 million in December 2006. 4+ million sites are “stumbled” daily.
StumbleUpon has only raised a single $1.5 million round of seed financing.
Comscore says StumbleUpon had 6 million U.S. page views in March, doubling from the prior month. Unique visitors continue to rise dramatically: 900,000 in March, which is a 3x rise over the last year. Charts are below.
I’ve been unable to get confirmation, or even a comment, from the company or any of its investors. Frankly, they won’t even return phone calls (which also tells me a deal is brewing). But enough people close to the deal are talking. The facts are coming out.
Interesting… I really like StumbleUpon. I take it the purpose of the buyout is to buy eyeballs?
I’ve been using them for a while and I like them. They also provide a small but steady stream of visitors to my blog, which is nice.
70 million seems a bit low. I hope they go for more than that…
There is a pretty good article on webpodge that explains why Stumbleupon is worth $50 million plus.
http://webpodge.com/2006/11/15/stumbleupon-are-they-worth-50-million/
While I didn’t particularly care for the service itself, I can definitely see why people would like it – StumbleUpon is definitely awesome at what they do.
Congrats to them.
Not to shabby, AOL or eBay? That is quite a toss up. Both need a boost right now.
Rex
I love this application. Hopefully they did shoot higher than $75M
updated post – It’s ebay.
I love StumbleUpon too. It’s always struck me that their targeting would be very affective for something like Digg. With the Digg model, you get a “mob rules” popularity, while with a StumbleUpon targeting model, you’d get like-minded individuals voting up and down articles in a personalized format. Much more useful for people with diverse interests.
Anyway, kudos to them!
I’ve tried StumbleUpon and found it not very useful or fun, but I can see why it might be an interesting feature add-on for eBay.
I just don’t know about eBay… If I was an eBay stock holder, I’d be selling right about now. Like I said, StumbleUpon is a good application, but I don’t see what it has to do with eBay (much like Skype).
However… they could use such services to integrate a level of sociality to the eBay auction site. If they aggregated the relationships found within Skype and StumbleUpon, they would be able to recommend products based on what your network is buying or selling.
Not likely to happen, but it’s a good idea (hint: get some real innovators in your company – do something with your assets)
StumbleUpon + Skype + eBay = zombo.com
Just wait…
Skype 2.0?
Ugh. That pisses me off I love stumble i hate ebay
I used to work at eBay, and I have to say, their management is clueless. Promotions at eBay are done by who-knows-who and seniority, not ability.
Nobody ever talks about buying things on eBay anymore. There are too many better alternatives now, and eBay has lost its coolness factor. It’s actually embarrassing now to admit you are using eBay to buy things. Selling on eBay still makes sense as long as you’re selling trash that you can’t sell anywhere else.
With eBay sales volume no longer growing, the Skype acquisition was an act of total desperation. Skype has nothing to do with the core competency (which admittedly is weak) of eBay. StumbleUpon has even less to do with it.
eBay is dying, but PayPal might save eBay in the end, isn’t that funny? I look forward to the day it’s called “eBay — a PayPal company”.
Very odd. I agree with Robert (#11). Unless they’re tying in the StumbleUpon functionality to “You may like this product so click here,” it seems completely unrelated to eBay.
Alternatively, they could provide eBay auctions based on the suggested sites, but that seems like a nightmare to administer.
why? lol.
I know it’s a stretch, but I wonder if this is similar to Amazon buying Alexa to try to bring traffic/search to their portal.
Here’s something to consider – if $40 million buys the company, what is the value of the potential traffic and product upsell revenue that eBay could generate by owning it’s own search engine?
Think about the TV media costs to run ads for a few months. $40 million in an off-line campaign to attract users isn’t unheard of. So to own 1m uniques per month for the same price?
Don’t think of it as a strategic product buy, think of it as a strategic ad buy. Not necessarily a good one, but…
Hey – eBay isn’t buying eyeballs or traffic, people. They are buying the technology for a DISCOVERY SERVICE to get browsers deeper into eBay and improve the ebay search experience.
http://techfold.com/2007/04/18/techcrunch-ebay-to-buy-stumbleupon/
I am shocked that Yahoo, MSN, Google, or Ask didn’t aquire them. That seemed like a perfect marriage of technologies. Does anyone know if Stumble holds patents to their technology. That would seem to be the only reason why a search would not buy them–if social stumbling could be easily replicated.
I absolutely love StumbleUpon. Once you get into it, you can just spend hours discovering new things on the web. I hope that they don’t lose their magic in this acquisition.
Good luck Garrett, Geoff and Justin!
Interesting point on the “ad buy” Will. congrats to Garret, Geoff and Justin!
I don’t think it necessarily needs to have anything to do with eBay’s central business. The reported price seems like a good price, period, so I don’t see it being a bad decision.
Another development to lend creedence to the eBay rumor. eBay just announced that they would start allowing sellers to link to video hosted on aprroved sites. Since video Stumbling is the driver of all this new traffic to Stumble Upon, I see some product stumbling in our future.
@15: Jason
Where are you getting the idea that eBay is “dying”? I have no clue of the other competitors you are talking about. If there ever is an internet monopoly, eBay is it. I still buy and sell tons of things, books, DVD, electronics, cheap Hong Kong knockoffs of cellphone accesories and I buy and sell them all on eBay or Half.com. Sure I buy some used books from Amazon now and then, but eBay is as strong as ever.
Saying that, the Skype deal must have been proposed by a person who is as dumb as a door knob… I sure hope that guy has been fired from eBay.
I love Stumble and advertise on their system for a few clients. I am surprised eBay purchased them as it would seem a much better fit for Yahoo or Google.
This acquisition actually worries me a bit, I dont really see the correlation between the two and am worried how eBay will run the site/system. Paypal sucks, eBay has gone downhill in my mind as I rarely buy things there anymore.
I just don’t see much improvement or innovation form eBay. If they are buying this as an ad buy, this sucks.
Yes, maybe stumbleupon can help ebay by letting ebay stumble all their auctions randomly throughout the stumbles at which point i might stop using it…. well, that’s the worst case but maybe they might leave it alone.
Congratulations to StumbleUpon – launched in 2002, took a small investment, and kicked some arse.
Mike, your forums are down.
I’m happy to hear this for the guys who do StumbleUpon – it’s a great product and one of the few web2.0 winners. I hope they don’t get caught in the “post-acquisition zombie state” that happens to so many start-ups after acquisition where no improvements happen anymore.
my SU username is http://ninetimessix.stumbleupon.com if anyone wants to add me.
Does anyone know how long as stumbleupon.com been around?
I also don’t like too much the idea of eBay acquiring StumbleUpon: the freedom of choice, publishing content and even social bookmarking quality may reduce and it will become one more of eBay’s marketing engines. Well, that’s just myself dreaming a little bit, but if eBay acquired StumbleUpon they want something in return. And they will surely get it.