Once upon a time, Six Apart (news, site) played in the big leagues. The blog software provider raised over US $22 million, landed the cover of an issue of Fortune, bought and sold companies for profit, etc. But the tides have done what they do best, turning the company's tune somber with reports of serious financial trouble.
An Unfortunate Series of Events
Big news came down the Six Apart pipeline for the first time in a long while in January of this year when the platform's very first employee, Anil Dash, left the building. Though Dash claimed it was simply time for him to move on to different things (Social Gov), we couldn't help but wonder what his departure meant for the company.
News fell silent again until August, when rumors of a deal in Japan touched headlines. The Buzz rose to all new heights in early September when Vox died, and though Six Apart representatives hotly denied merger rumors, the company was finally acquired by Say Media just a couple weeks later.
Ex-Six Apart employee Maarten Schenk valiantly tried to find the silver lining in a recent piece about the company's future in Japan, but any quelled concern resurfaced in light of a recent report from Bobbie Johnson of GigaOM:
According to merger documents shown to me by a source, Six Apart’s finances had become so bad that it was even forced to ask VideoEgg for a $2 million loan just to help it stay afloat while the deal was prepared.
A few highlights if the 100+ page document include:
- The US$ 2 million loan from VideoEgg was to help Six Apart pay “liabilities and operating expenses” until the official merger announcement. Johnson noted that this "goes beyond third-party expenses, and presumably included cash for items such as salaries."
- The merger agreement reduces the purchase value of Six Apart each day until the deal is completed
- VideoEgg and Six Apart shareholders will take a 72/28 split of Say Media.
"All in all, the files make for a depressing read...” added Johnson.
Think Positive (?)
Meanwhile, experts and ex-employees continue to talk up the platform. Bryne Reese, the ex-Product Manager for Movable Type and current co-founder of the Melody project, noted in an e-mail discussion that both Movable Type and TypePad are solid products generating significant revenues.
All this other news, however, isn't helping to make believers out of us. We suppose we'll just have to wait and see.