What Engadget's Gang Can Learn From StumbleUpon

A bad merger, like a bad marriage, sometimes needs to end in divorce.

When Engadget was acquired by AOL in 2005, it perhaps wasn't the best fit. Last month, editor Joshua Topolsky announced he was leaving the site, part of an exodus that comprised "as many as eight of the more prominent editorial and technology staff members," in the words of The New York Times. The brains of Engadget, it was revealed, would be finding a new home with SB Nation, a group of sports sites. And so the nerve center of a tech blog has up and left a tech brand, AOL, in favor of a sports brand, SB Nation. Nerds shacking up at the frat house: Is this really moving up?

Probably, yes. The fact of the matter is that when an acquisition proves a mistake, the acquired do best to move out. That, at least, appears to be the lesson learned from StumbleUpon. The Next Web interviewed StumbleUpon's VP of Technology, and learned that re-acquiring itself was the best decision it ever made. The site, first founded as a photo sharing engine in 2001, got snapped up by Ebay in 2007 for $75 million. But a few years after that, the founders raised the capital to but the company back. It created a slew of new products in the intervening two years, more than doubling its traffic.

Since parting from Ebay, Liebowitz tells me that StumbleUpon has grown from 6 million to 15 million users. Recommendations have tripled, now surpassing 800 million every month. Each month, over 3-4 million users are active on StumbleUpon, with the primary base being in the U.S.

The mobile app's userbase has been growing at a rate of 40% per month, TNW also reported. StumbleUpon sends more traffic along than any other social media site.

Divorce hurts, in business as in life. But sometimes it's the best course of action. And if they have doubts about moving into a new house with a bunch of jocks, Topolsky and his fellow refugees need only look to StumbleUpon to realize that sometimes ending a wealth-producing marriage is actually for the best.

"We have been working on blogging technology that was developed in 2003," Topolsky tells the Times today. "We haven't made a hire since I started running the site, and I thought we could be more successful elsewhere."

If he ever has any doubts about that, Topolsky knows who to call.

Follow Fast Company on Twitter. Email David Zax, the author of this post.

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