App created by British teenager sold to Yahoo for millions

Daily News Article   —   Posted on March 26, 2013

Note: This article is from the British newspaper the London Evening Standard.

(by Jonathan Prynn, London Evening Standard) – A London teenager has sold a mobile app he first designed [at home] for between $30 to $60 million.

Nick D’Aloisio, 17, said he would probably buy a new computer and trainers [sneakers] after Yahoo bought his Summly software for an undisclosed sum.

The deal makes Nick, of Wimbledon, one of the world’s youngest technology millionaires.

He said the sale was “like a dream” and comes four months after he launched the app, which has already been downloaded almost one million times.

Nick lives at home with his father,  an energy financier in the City [London] and mother who is a lawyer. He said: “I honestly never expected any of this to happen. I started doing it as a hobby and I didn’t realize it was possible to make money out of it.

“I like shoes, I will buy a new pair of Nike trainers and I’ll probably get a new computer but at the moment I just want to save and bank it. I don’t have many living expenses.”

The free iPhone app automatically boils down lengthy news stories and features to make them more “user friendly” for a mobile screen. After the takeover he will work for Yahoo at their London office in Soho full time and study for three A-levels in the evenings with support from his teachers at King’s College School in Wimbledon.

Nick first had the idea for Summly when he was studying for mock exams at home in 2011 and found clicking between different articles on Google “inefficient and time wasting.”

He said: “I realized there was all this information on the web but it had not been ordered. That’s when I had the idea for an algorithm that would summarize the results of web searches automatically.”

The price paid for the business has not been revealed but it is said to run to several “dozens of millions of pounds.” Industry sources suggested the price would be between £20 million and £40 million. Nick remains the majority shareholder even though he is not yet old enough to be a director and the multi-million-pound proceeds will have to go into a trust fund.

The first version of the app, called TrimIt, was launched in July 2011 and was named “app of the week”. The publicity led to a £160,000 investment by Chinese billionaire Li Ka-Shing’s venture capital firm Horizon Ventures and further backing from individuals including Stephen Fry, Yoko Ono and American actor Ashton Kutcher.

The investment allowed Nick to develop the more sophisticated Summly version of the app, which now has deals with 250 online publishers including Rupert Murdoch’s News Corporation.

Nick said: “Hopefully there will be a lot more entrepreneurs coming out of the UK who will start working with Silicon Valley.” The teenager, who got his first Mac laptop when he was nine, said: “I launched five or six apps when there were only a few thousand apps at that time and got quite a lot of downloads.

My first app was called FingerMill which was a treadmill for your fingers. They were just simple gimmicky apps but it was a learning experience.”

Nick said he hoped to complete his A-levels and go on to study at university. He has been off full-time school for six months developing the business, which already has 10 employees and offices in Shoreditch.

He added: “My friends at school have been extremely supportive, when I’m with them it’s just the normal banter, I don’t feel any different. They’re doing their A-levels, which is just as pressurised as what I do.”

Neither company would disclose the terms of the deal publicly.

The app itself will now close, but its features will be used in mobile products at Yahoo, where Mr D’Aloisio has been given a job.

He will be joined by several of Summly’s “top staff” in new roles at Yahoo in the next few weeks.

The app launched when Mr D’Aloisio was just 15, and soon attracted more than £1m ($1.5 million) of investment. He is now likely to be one of the world’s youngest self-made multi-millionaires.

Speaking to the London Evening Standard, the Wimbledon-based teen said: “I like shoes, I will buy a new pair of Nike trainers and I’ll probably get a new computer, but at the moment I just want to save and bank it.

“I don’t have many living expenses.”

In a note on the Summly blog, Mr D’Aloisio wrote on Monday: “When I founded Summly at 15, I would have never imagined being in this position so suddenly.

“I’d personally like to thank Li Ka-Shing and Horizons Ventures for having the foresight to back a teenager pursuing his dream. Also to our investors, advisers and of course the fantastic team for believing in the potential of Summly.

“Without you all, this never would have been possible. I’d also like to thank my family, friends and school for supporting me.”

Yahoo’s senior vice president of mobile, Adam Cahan, said the company was “excited” to have Mr D’Aloisio and his colleagues on board.

“For publishers, the Summly technology provides a new approach to drive interest in stories and reach a generation of mobile users that want information on the go,” he wrote.

Less enthusiastic about the acquisition was app developer Little Fluffy Toys.

The London-based company was commissioned by Mr D’Aloisio to create an Android version of the Summly app – which was days away from launch.

Little Fluffy Toys director Kenton Price – who is also contracted by the BBC – said that his firm was told the Yahoo deal was on the cards, but was “disappointed” the app would now never be released.