Flipboard is at stake: the brain drain seriously not the company buyers

United States wrote the online edition of the Wall Street Journal today, while reading Flipboard was once highly anticipated iPad application developers, to create a new mode of reading, but is facing increased competition, the company's growth in recent years are not satisfactory.

Following is the full text of the article:

Flipboard has been voted best iPad applications from Apple, but now faces the various competitors, including Apple's own, and it can only struggle to survive.

In recent weeks, this news-reading application, co-founder of Yiwan·duoer (Evan Doll) and the company's CTO Eric Feng (Eric Feng) chose to leave, further aggravated by the brain drain--the company over the past year, Flipboard leaving the service financial, product, and sales executives.

People familiar with the matter said, such heavy talent losses came as investors to its co-founder and CEO of Flipboard Maike·maiqiu (Mike McCue) pressure to revive the time of business model or find a buyer. Flipboard is currently valued at $ 210 million.

Earlier this year, Flipboard hired one of its largest investors, Goldman Sachs helped the company acquisition talks with Twitter. Flipboard spokesman said, since the beginning of this spring, these negotiations have been at a standstill, but Goldman still in cooperation with Flipboard in identifying other potential acquirers. The spokesman also added that Flipboard is currently not active talks.

Comment on Twitter before you Reject the takeover talks. Goldman did not immediately respond.

People familiar with the matter said, as the two sides could not agree on a price, leading to negotiations on hold.

People familiar with the matter said, with the decreasing demand, Flipboard at the end of 2013 to meet investors ' expectations of us $ 800 million valuation, revenue also repeatedly does not meet internal targets. The company's revenue target of $ 80 million last year, but only about US $ 20 million.

Flipboard's experience highlights a lot of startups are facing challenges: they are early on in the development of extremely high valuations, but the potential market is difficult to determine, and business models are not clear enough.

Reading Flipboard formally launched in July 2010, after 6 months, Apple co-founder Steve Jobs (Steve Jobs) has just launched the first generation iPad. McCue was a serial entrepreneur, who in 2007 he founded TellMe voice recognition service for $ 800 million sale to Microsoft, and later developed jointly with Apple iPhone engineers before Dole Fliopboard, for Tablet users with a magazine-like reading experience.

This application lets users select from social networking information and selected news sources capture data, to obtain a custom magazine reading experience, and received a widely sought after iPad users. Flipboard on-line 18 months become the best-selling 100 apps in Apple's App Store. Apple even Flipboard selected for the 2010 best iPad applications.

Magazine publishers initially feared Flipboard Rob its potential users, but also actively embrace the application, contact the new digital readers through this channel, instead of having to develop their own applications. The start-up company and the New York Times, Condé Nast Shi reached cooperation agreements with other publishers, and sold together with the Visual elements of interactive advertising. People familiar with the matter said, Flipboard CPM display advertising costs about $ 50.

But in recent years, Flipboard's innovation advantage are undermined. Tablets and smart-phone application has dozens of news reader applications to choose from, including the New York Times and Condé Nast independent development of applications. Apple is also launching its own news aggregation application of Apple News, including the latest version of the iPhone and iPad software. Facebook and Twitter have also revised their application, put the news in a prominent position.

App Annie, according to market research company statistics, Flipboard is currently in the United States the iPad application in 1030. Two people familiar with the matter said, the company's advertising also has been cut by more than half, thousands of shows cost less than $ 20.

United States market research firm Forrester Research zhanmusi·maikuiwei (James McQuivey) said: "with the passage of time, they have lost their monopoly, so ads can only decline. ”

McCue said Flipboard has recently increased its big-name advertisers such as Starbucks and Rolex, CPM display ad prices between 20 to 60 dollars. He also said, disappointing revenue and user growth a year ago, but the company is working to improve products, strengthening the sales team, and would exceed growth expectations for this year.

"We in trouble a year ago. "McCue said," we are out of trouble, and accelerated growth, growing more rapidly than many products. ”

But the CEO Reject sharing financial data.

Flipboard has external trumpeted its user growth, doubling from 41 million in the year to 80 million. People familiar with the matter said, the high growth mainly comes from the cooperation with Samsung Electronics, Flipboard application pre-installed on Samsung's part of the Android phone.

McCue has tried to rein in spending. Earlier this year, he gave up his rented Flipboard Headquarters plans, because another company using cash to buy the property.

People familiar with the matter said, McCue in July this year by JPMorgan Chase to raise 50 million dollars, but valuations with the same 19 months ago. This is worthy of attention.