Short Take: VCs Love Tumblr But Will Brands?

When Facebook CEO Mark Zuckerberg was unveiling Timeline last week at f8, Digitas’ svp and Social Marketing Practice lead Jordan Bitterman tweeted, “Initial thought (halfway through Zuck’s keynote) at #F8, these changes are a Tumblr killer.” If Tumblr died last week, nobody told the venture capitalists. The 4-year-old blogging startup just raised a whopping $85 million in funding, bringing its total to $115 million overall. With a bank account like that, the company can afford to fight off a lot of threats, even from Facebook. An acquisition could certainly be in the works. But Bitterman makes an important point. Tumblr has yet to figure out its business model. And Facebook does have the power to dominate markets when it gets serious (like photo sharing).

When Digiday talked to several experts in the industry back in June, the thinking was that Tumblr was a year or a year and half away from a revenue model, whether that’s advertising or a paid/virtual goods model, as one analyst suggested. Now Tumblr must make sure that Timeline and the convenience of using Facebook to satisfy every aspect of one’s digital life do not overwhelm its reason for being. It does have a few things going for it. Tumblr allows for more anonymity than Facebook. And it seems to allow users to explore a more creative, artistic slant that Facebook doesn’t always satisfy. (That artistic side can, inevitably, veer into porn.) One thing Tumblr seems have over Facebook is publisher love, for the time being at least. While the Web publishing world is approaching Facebook Editions with hesitancy, more and more publishers, particularly those from traditional media, are embracing Tumblr, such as GQ and The Economist. That media love could translate into some interesting partnerships down the road.

https://digiday.com/?p=2480

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