Leo: The thing about digg, which is really sad, is that uh, you know Murdoch offered well over a hundred million dollars for Digg and it wasn't Kevin, it wasn't Owen, I don't think it was even Jay. None of the principals there, they all wanted to take it believe me, they wanted to take it and that's what happens when you take investors. The investors said, "no, we're worth 150 or nothing!"
Dvorak: you know, I can't believe for a minute that the two founders couldn't push that one through
Leo: boy you'd think so, but I've heard from, I haven't talked to Kevin about it, but I've heard from very good sources that Kevin wanted to take it, he wanted to take it. Well he's worth, I think he really would, if they'd gotten the 100 million he would have been worth the sixty million that Business week said he was worth, It's kind of sad...
Dvorak: ... The investors would have taken a big piece... I'll tell you this much, he'd be buying!
The above is my best attempt to transcribe part of TWiT 77 1:16:24 -> 1:17:15
If the above statements from Leo are accurate, and I have no reason to doubt them, it would seem to indicate that the initial $2.8M round of investing has cost Kevin his shot at being the Sixty-Million-Dollar-Man!
Now, Jay Adelson has come out on forbes.com saying that Digg is not for sale.
Is Digg for sale?
No. Digg is not for sale. Our focus is entirely on execution. The only way that Digg would ever be for sale is if someone came to me and could help me achieve my goal ten times better than what we can do alone. There's been a lot of rumors out there, and it's mostly stirred up because of the YouTube acquisition. Basically if you're a Web 2.0 company right now, somebody's going to come up with a rumor.
In an earlier blog post I talked about a few of the issues with the possible acquisition of Digg by News Corp. I'm going to take a look at some of those same issues a month later:
Alexa is currently too busy to provide comparison graphics so I will have to go with some basic data:
Alexa Ranking as of October 25, 2006 for Digg: 89
Alexa Ranking as of November 21, 2006 for Digg: 85
Alexa three month rolling Ranking for Digg: 99
In the last month they have gained 4 spots.
This is not bad as getting into the top 100 sites is hard enough. Making headway while in the top 100 is certainly very tough as the difference between sites is a margin of millions rather then thousands. This is why you will often see a site with a meteoric rise of +70,000% in Alexa rankings because they got Dugg, or Slashdoted, or what-ever.
I still feel they should have sold to Murdoch when they had the chance.
The scary thing is that their initial round of investing was only for $2.8M! How much power did Jay and Kevin give up to the VC funders for that $2.8M?
Kevin may not have become the sixty-million-dollar-man with a $100M+ buyout by News Corp but he would certainly be well on his way to a life of extreme comfort!
I'm sorry to have to say this Kevin but, you got screwed by your VC funders. I agree with Dvorak, there must have been something you could do to push this thing through. I'm sure the nightmare of what happened to friendster is going through your head right now, as well as a line from an old movie... "I could have been a contender..."