Yahoo Buys Summly — Paying $30M To Kill The App, But Keep Its 17-Year-Old Founder

Yahoo has made another bold move in the mobile space by acquiring news reading app Summly. While the deal is not yet closed, sources tell AllThingsD that Yahoo ponied up $30 million in cash.

That hefty sum is notable because Yahoo is also killing the Summly app, but holding onto its creator Nick D’Aloisio, who built it in his London home two years ago when he was just 15. Yes, you read that right. The charismatic English entrepreneur is only 17 years old, and he's managed to put his creation in the hands of nearly a million users since its December 2011 launch while raising $1.5 million from big names like Horizon Ventures.

The app's secret sauce involved a unique algorithm that summarized articles from all over the Web, automagically condensing news stories and blog posts into bite-sized summaries intended to save readers time.

Summly No More, Though D'Aloisio Stays... For A While

Yahoo made it clear that its sights were set on the backbone of the app — its team and its algorithm. "While the Summly app will close, you will see the technology come to life throughout Yahoo!’s mobile experiences soon," wrote Adam Cahan, Yahoo’s senior vice president of mobile and emerging products, on the company's blog this morning

D'Aloisio and his team, which numbers below the double digits, will join Yahoo, but the young founder has reportedly signed on for only 18 months — a smart move considering his potential. Yahoo's decision to ax the app could suck for users, assuming Summly was on a path to turn into the next Flipboard or Zite or Pulse (which we'll now never know). But it's great news for Yahoo, which couldn't care less about even a fast-growing, though still relatively small, news reader app.

The acquisition of Summly follows Yahoo's purchase of Jybe, a social recommendation company, just last week and New York City-based app Stamped, which similarly let users build recommendation lists, last fall. It's all part of CEO Marissa Mayer's plan to revitalize the ailing Yahoo brand and update its services for a new, mobile-centric generation.

Education Of An Entrepreneur

D'Aloisio required a few at-bats before he connected with Summly. The most important was Trimit, a bookmarklet and iOS app that acted as a text summariser in much the same way that Summly would later, albeit with a much more rudimentary interface and level of design. It was popular, but not quite as pervasive as D'Aloisio had hoped. And he apparently went a bit nuts trying to gin up coverage as a result.

This culminated with a lesson in email etiquette from Gizmodo writer Casey Chan, who titled a post in August 2011 "How I Made A 15-Year-Old App Developer Cry." Chan related how D'Aloisio's intense fervor — read, non-stop barrage of pleading emails — resulted in Gizmodo deciding to make Trimit the blog's featured worst app of the week (a "dick move," as Chan later put it). Though Gizmodo didn't know D'Aloisio's age at the time. 

Two years and $30 million later, D'Aloisio appears to have survived just fine. Watch and listen to him charm you into thinking Summly is the coolest thing on the planet in the video below. It gives you a good sense of the kind of marketing buzz he might bring Yahoo in the coming months. 

 

Lead image screencapped from Summly Launch from Summly on Vimeo