Tuesday, May 21, 2013

Investopedia: Yahoo! Adds Tumblr, But Is This Another Underpants Gnome Deal?

Whether it's because of my Wall Street background or it's just legitimately funny on its own, the Underpants Gnome episode of South Park is one of my all-time favorites. I particularly love the explanation of the business plan – Step One: Collect Underpants, Step Two: ?, Step Three: Profit – as it so well captured the silliness of tech bubbles and pilloried the ridiculousness of the CEOs and corporate boards of the era.

I'm not sure Yahoo! (Nasdaq:YHOO) shareholders see quite the same humor in it, though, as the company's past acquisitions of GeoCities, HotJobs, AltaVista fit that model pretty well. Now we have Yahoo! spending over $1 billion of shareholders' money on Tumblr. Management promises that this time will be different, and how this deal goes over the next couple of years will say a lot about whether new management will produce different results for this long-struggling internet company.

Please click the link to continue:
http://www.investopedia.com/stock-analysis/052113/yahoo-adds-tumblr-another-underpants-gnome-deal-yhoo-goog-fb-msft-iaci.aspx

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