Mayer’s Yahoo Buys Summly, A Mobile Startup By A Teenager

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Yahoo! Inc. (NASDAQ:YHOO) announced today of its plans to acquire Summly, a mobile startup that makes an app to help smartphone and tablet users find, read and share online news and information.

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California-based Yahoo said in its blog that Nick D’Aloisio, who started Summly at the age of 15, will join Yahoo along with the rest of his team. The other details of the deal have not been made public yet though technology blog AllThingsD reported that Yahoo paid roughly $30 million, citing anonymous sources.

Yahoo! Inc. (NASDAQ:YHOO) plans to close the Summly app but will synchronize the company’s natural language processing and machine-learning technology across Yahoo’s various online services, mainly Yahoo’s line-up of mobile services.

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According to Yahoo’s Senior Vice President of Mobile and Emerging Products Adam Cahan, the three employees of Summly will join Yahoo while founder D’Aloisio will remain in London as he wants to finish his A-levels, and become Yahoo’s youngest employee. The deal is expected to be completed in the second quarter of this year.

The acquisition by the largest U.S. Web portal is in line with the statement made by Chief Executive Officer Marissa Mayer last year. Mayer at that time said that her main aim is to focus on providing Web services that are customized for individual users, and to achieve this the company wishes to add engineers by buying small technology startups.

Since Mayer took over as the CEO in July last year, Yahoo! Inc. (NASDAQ:YHOO) has acquired six such companies including Jybe Inc., Stamped Inc., OntheAir, Snip.it and Alike.

Mayer’s vision for the company includes building sites and technologies that can be used by consumers on a daily basis like checking e-mail and stock tickers.  In January, she said that Yahoo intends to be “a feed of information that is ordered, the Web is ordered for you and is also on your mobile phone.”

D’Aloisio started Summly two years ago from his home in London. The company works closely with News Corp and enjoys the confident of Chinese investor Li Ka-Shing and angel investors including the actor Ashton Kutcher and artist Yoko Ono.

The first app was released by Summly five years ago, called Fingermill, in which a user could run an onscreen virtual treadmill with the fingers. One of the app reviewer called the app as the worst application you can ever download” for its lack of interaction or use. However, the app launched by the company in November 2012, won one of Apple’s Best Apps of 2012 award.

In the early Monday afternoon trading session, Yahoo! Inc. (NASDAQ:YHOO) stocks gained 11 cents to $23.36. This year up till March 22, California-based company’s shares have gained 17 percent.

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Aman is MBA (Finance) with an experience on both Marketing and Finance side. He has worked as a Risk Analyst for AIR Worldwide, and is currently leading VeRa FinServ, a Financial Research firm. Favorite pastimes include watching science fiction movies, reviewing tech gadgets, playing PC games and cricket. - Email him at amanjain@valuewalk.com
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