How Much Would Yahoo Pay for a Qwiki? (YHOO)
Lightbank, Lerer Ventures and other investors have poured more than $10 million into Qwiki, an app that automatically merges photos, videos and music into one mobile movie.
According to AllThingsD, this app has gotten the attention of Yahoo (NASDAQ: YHOO), which is currently discussing the possibility of an acquisition. Better still, Yahoo could offer the firm as much as $50 million.
This deal would provide the firm's investors with a hefty return. The same cannot be said for another company that Yahoo is interested in acquiring.
In a separate story, AllThingsD reported that Yahoo has offered to buy Xobni for $30 million to $40 million. While many investors and entrepreneurs would be happy to sell their companies for less, Xobni (a smart contacts app that recently started supporting iCloud and Yahoo! Mail) was built with more than $40 million in venture capital.
First Round Capital, Baseline Ventures and Khosla Ventures are among the firms that helped Xobni (which is "inbox" backwards) build the company. If Xobni is sold at the rumored price point, those and other investors might not turn a profit. Worse yet, they might actually lose money on their investment.
A loss may be inevitable, however. Xobni's owners have reportedly talked to other interested buyers, and none of them are willing to pay as much as Yahoo.
Xobni could choose to decline the buyout -- as others have done in the past -- but that could put a greater strain on the owners. While they could break even or regain most of their investment, if they choose to wait, the company could slowly lose whatever value it has left.
If Yahoo is willing to pay $30 million or $40 million for a firm, it shows that the company still has enough value (either via the team, the product it created or both) to achieve great things. Yahoo won't sit around and wait, however. The company has plenty of capital and internal resources. If it needs to create its own version of Xobni -- or find a similar app to acquire -- it will do so.
When Yahoo was more or less forced to walk away from its plans to buy YouTube clone Dailymotion, the company shifted its attention back to Hulu. It is not yet known who will win the bid to acquire Hulu (or if Hulu's owners will actually sell this time around), but DirecTV's (NASDAQ: DTV) name was recently tossed into the pool of potential buyers.
Louis Bedigian is the Senior Tech Analyst and Features Writer of Benzinga. You can reach him at 248-636-1322 or louis(at)benzingapro(dot)com. Follow him @LouisBedigianBZ
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