Yahoo Acquires Bread, Will Shut Down The URL Shortener That Earned You Money

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Yahoo has just acquired Bread, a 2.5 year old startup that had raised $3.5 million [Update: and we hear was low on cash and shopping itself around to several companies]. Bread let people make money or generate donations by designing interstitial ads. These ads could promote a product or cause and would be shown to people who click links the designer shared through Bread’s URL shortener.

Bread has shut down its core publishing products, and its links will go dead in 30 days. It recommends users switch to dominant URL shortener bit.ly.

Bread’s investors include musician manager and angel Troy Carter, Formation 8′s Joe Lonsdale, fashion designer Marc Ecko, and Raptor Ventures.

Screenshot 2013-10-11 at 6.52.49 PMBread’s CEO Alan Chan wrote in a statement on its website that “When we launched Bread in 2011, our goal was to help social media influencers and publishers better monetize their online content. In Yahoo, we found a company that shares our vision. We are thrilled to join Yahoo’s advertising team in Sunnyvale where we will be working on developing next-generation solutions for social and mobile publishers and advertisers.”

The team had ten employees as of a year ago, but Yahoo confirms that six engineers and product managers will join its advertising technology team, saying:

“We have acquired Bread, a company that created a simple way for social media influencers and publishers to monetize their content. The team’s focus on delivering creative and targeted advertising across social media, desktop and mobile devices aligns perfectly with our mission to delight and inspire users.”

The idea of Bread was to let you monetize your social media reach. If you had a product, event, or cause to promote, it could help you get the word out by piggybacking on other content. You’d design your ad, pick a link you wanted to share that you thought people would click, and run it through the bre.ad URL shortener. You’d share the link on Twitter, Facebook, or wherever, and each person who clicked would see your interstitial ad for five seconds before being directed to the link’s destination.

Here’s a screenshot of an ad our editor Alexia Tsotsis made in 2011 when Bread was getting off the ground.

Bread Screenshot

Eventually, Chan wanted to create premium products like analytics for shared links and the company did launch Bread Pro. However, we haven’t heard much more about Bread since 2011. A source says Bread was running out of money and wanted a soft landing. It was apparently in talks with several companies about acquiring it but went with Yahoo. Being acquired has become a popular way for floundering startups to save face, repay investors, sometimes earn a little money, and find new jobs.

Marissa Mayer has been focused on buying consumer startups as of late, but Bread’s team could strengthen the ad products that monetize Yahoo’s properties. Together they might be able to turn all of the Yahoo feel-good momentum into real revenue.