StumbleUpon to eBay: So long and thanks for all the hits

When is a startup not a startup? When it’s got something to do with eBay, as far as I can tell.

The question isn’t some kind of Zen riddle, but my immediate reaction to the news that StumbleUpon and eBay were parting ways — just two years after the auction giant sloshed $75-million on buying the web discovery service. The deal initially resulted in plenty of head-scratching action, but since the buyout the service appeared to plod on well enough.

But on Tuesday the companies have announced that co-founders Garrett Camp and Geoff Smith — along with a team of investors — have bought SU back. Meaning, I suppose, that it’s a startup again.

An official entry on the StumbleUpon blog suggests eBay had a lack of ambition, saying that “our goal is to make StumbleUpon the web’s largest recommendation engine and we think this is the best way to get us there”.

It still leaves a big question about where StumbleUpon goes in the future — after all, if venture-backed startups have two ways to rake in cash (the stock market and acquisition) then who’s going to take on eBay’s sloppy seconds?

The news comes as an addendum to reports last weekend that Skype’s founders are looking to prise the company out of eBay’s hands and take it back. It seems eBay — under pressure after poor financial results — is prepared to jettison the string of odd purchases it made in the last few years. Fairly good news for eBay fans, but not for Meg Whitman, the former CEO and architect of those deals — who is now preparing to run for election as governor of California. –

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