Introduction In many ways, the story of David Karp resembles that of any eccentric tech entrepreneur. He wears plaid shirts, eschews mainstream brands, and lives in a loft in Williamsburg, Brooklyn. Karp was obsessed with coding when he was a kid, dropped out of school to start his own business, leveraged his social relationships, and is now worth hundreds of millions of dollars. David Karp’s success can be attributed to his visionary obsession, his social networking skills, and his willingness to change.

Background

The story of David Karp’s success is replete with ups and downs, and even a few crashes, but surprisingly few burns. Every challenge that Karp has faced has been a challenge he has met with aplomb. Karp does not operate the way typical managers do, but few of the world’s great business leaders or entrepreneurs do play by the books. Like Steve Jobs and Richard Branson, David Karp has an unusual approach to doing business that is difficult, if not impossible, to imitate.

Karp’s success comes down to the primary element of dedication, which could also be construed as obsession. By the time he was in junior high, Karp was hacking into his school computer (Cohan, 2013). Karp taught himself HTML when he was just 11, and continued to be a self-taught coder with almost no formal education. One thing his formal education did provide was a foundation in Japanese language, which Karp capitalized on for personal reasons, spontaneously moving to Japan for a year. Karp’s early obsession with learning Japanese paralleled his fascination for programming. The two went hand-in-hand, too. When he moved to Japan, he was already remotely employed in his first real tech job in New York, for UrbanBaby. Because Karp worked remotely, he was able to shift his base of operations to Japan without even telling his bosses (Cohan, 2013). His work for UrbanBaby not only gave Karp his first taste of what it was like to work in an unconventional tech company, one that allowed him to set his own hours and work from wherever he was around the world, but it also helped him gain a footing in the tech community. Later, when Tumblr was gaining traction in the market, Karp hired his former boss from UrbanBaby.

When UrbanBaby was sold to CNET, Karp has become the firm’s Chief Technology Officer. He was barely 20 years old. The sale earned Karp enough money to invest in his own web consultancy firm, which he named Davidville, after himself. Karp hired Marco Arment to help with the coding and together they presumed they would build their dreams as web designers. However, Karp had other ideas, creative projects he was working on. He had always been interested in what was known as “tumble blogging,” a form of microblogging that was relatively loose and free form. Unlike long form blogging, tumble blogging was not about long blocks of analytical text. Also unlike Facebook tumble blogging was not about communicating...

Tumble blogging was something different, and something that did not yet exist yet. Karp recognized this gap in the market through his own passion for tumble blogging, and he started to pour all his energy into his side project, which would become known as Tumblr.
Tumblr’s growth from a side project into a company that sold to Yahoo for $1.1 billion is a remarkable story. David Karp’s success with Tumblr has hinged on several features of his personality and his vision. First is his passion, which is akin to dedication, persistence, and single-minded obsession. Second, Karp understands how to create and leverage social relationships. He was born into a family that already had connections, and Karp understood the need to use his privileged background as a means to gain entry into the tech world and attract investors. Third, Karp welcomes change. In fact, his recent history shows Karp actively plans for change, recognizing the need for innovation.

Challenges

One of the first challenges Karp encountered on his path to success was how to handle a rapid pace of growth. Even when Tumblr was still a side project, it was costing him and Arment $5000 per month to run the service. To address this challenge required both a willingness to commit to the Tumblr project as the main event, and also to be willing to ask for money from investors. The latter proved a lot simpler than the former. Almost immediately when Karp started to see how popular Tumblr was becoming he sold 25 percent of the company to venture capitalists. At that point, Tumblr was already valued at $3 million (Cheshire, 2012). Investments were even pouring in without any proof that Tumblr was going to make any money; at that point the platform did not host sponsored advertisements and it was uncertain how it would create revenues.

Challenges kept arising as Tumblr grew and his small team and their limited budget could not keep up with the growing number of users. Karp responded to this challenge professionally, by continuing to seek money from investors and pour that money into the business model that was working for them. Regarding the dedication to Tumblr over their Davidville consultancy firm, Karp and Arment had a difficult decision to make. Karp and Arment had already invested in Davidville, the web consultancy firm Karp founded with the money he made from the sale of UrbanBaby. Karp could have taken the safe road, focusing on building a client base for Davidville. He did not, and the reason he did not focus more exclusively on Davidville is related to the second major challenge Karp faced during the early years of his growth as an entrepreneur.

The second major challenge Karp faced as an entrepreneur was how to create an organizational culture that suited his personality and communication style. When Karp started Davidville, he needed to set up appointments with clients and respond to their emails immediately. However, Karp did…