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Tumblr Raises $85 Million Without a Business Model

Blogging service Tumblr said it has raised $85 million, although the New York-based company has scant revenue and has yet to develop a solid business model.

Silver Time from a Time Strange

Is the tech industry bubbling again? I have a Tumblr account, and like it well enough to keep using it, but there’s not anything compelling enough that I would pay a subscription for a Tumblr blog, and how else exactly is Tumblr going to make money?

Blogging service Tumblr said it has raised $85 million, although the New York-based company has scant revenue and has yet to develop a solid business model.

The lack of revenue kept some major Silicon Valley venture firms from signing onto the deal. But at least two prominent firms—Greylock Partners, an investor in Facebook Inc. and Groupon Inc., and Twitter-investor Insight Venture Partners have joined the investment round.

Other new investors include The Chernin Group, Sir Richard Branson and returning investor partners Spark Capital, Union Square Ventures, and Sequoia Capital.

Tumblr didn’t comment on the valuation that the investment conferred on the company but in recent money-raising discussions investors valued the company at around $800 million

(click here to continue reading Tumblr Raises $85 Million – WSJ.com.)

and even Tumblr execs don’t have a clue as to where the revenue will be coming from…

“Questions around monetization still exist,” he said. “But the company has absolute scale, massive traction, and huge growth and money-making potential.”
So far, Tumblr’s efforts to generate revenue have been mostly experimental.

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