After gushing with pride over Storyboard's many accolades, Mr. Karp pivoted, abruptly. The year-old concept "had run its course" and the editorial team, he announced, "will be closing up shop and moving on." Please, he asked, "join us in wishing them well."

But the Storyboard layoffs, which affected three staffers peripheral to internal operations, are hardly the only departures Tumblr has faced over the past six or seven months. Rather, they're the only ones Mr. Karp has spoken about publicly.

Sources close to the company, who requested anonymity, told Betabeat that a handful of high-level deputies have also quietly ended their tenure at Tumblr--leaving a noticeable absence around Mr. Karp where his leadership team should be.

"It’s like the fucking Argentinian government, people just get disappeared," said one source.

The most recent departure is Blake Matheny, Tumblr's VP of engineering, who gave notice in the past few weeks. Another source called it a "huge loss," adding, "Blake was the strongest tech leader there."

Fredrik Nylander, Tumblr's former executive vice president, gave notice last fall, we heard, but was asked to stick around by Mr. Karp, showing up at the office with less and less frequency. His LinkedIn profile states that he started as the CTO of Oscar, a New York City-based startup, this year. Mr. Nylander started as Tumblr's VP of technical operations back in 2011 and was promoted in less than a year to VP of engineering.

As EVP of Tumblr, Mr. Nylander replaced the role of former vice president Andrew McLaughlin, a veteran of Google, ICANN, and former deputy CTO for the Obama administration. Mr. McLaughlin lasted as VP at Tumblr for just nine months.

Marc LaFountain, Tumblr's former vice president of tech support, left in October, following his wife, an executive at R.J. Reynolds, to Switzerland. And last month, advertising veteran Rick Webb, who played a pivotal role consulting on the six-year old company's recent push toward profitability through advertising, announced that he too would be moving on after 10 months.

In the past, Tumblr has also lost lead developer Marco Arment, president John Maloney, and "vice president of people" Charlie Gray, an Xoogler who was with the company for only six months. So for tech leadership, that leaves Derek Gottfrid, VP of product, who may oversee some operations.

"We don't comment on staff moves, however all of the people you've referred to are very different circumstances spread out over months and not related at all to the closure of Storyboard," Tumblr spokesperson Katharine Barna said by email when she heard we were inquiring about the departures. She declined to comment further.

We reached out to each of the execs and will update the post when we hear back. But the sources we spoke with didn't attribute the recent shakeups to cost-cutting due to pressure from the board or even clearing the decks for Tumblr's rumored fundraising. Instead, they cited frustrations with Mr. Karp, who tends to marginalize deputies who disagree with him.

"Some people seem genuinely happy at Tumblr, but most are miserable, largely because Karp is wildly unpredictable and inconsistent," said one source. "Karp seems to treat Tumblr like a junior high lunch room--he sits with his five favorite people of the moment, and treats everyone else like a reject."

Mr. Karp has been encouraged to look for COO for Tumblr. Speculation says the role may go to former News Corp. chief digital officer and AOL CEO Jonathan Miller, who has been consulting for the company--one of the mentors Mr. Karp tends to collect. But Mr. Miller may still be hampered by "golden handcuffs" from his time at News Corp. Watchful observers don't have high hopes. "Even the COO search is a sham," said one source. "He’s not looking for Sheryl Sandberg, he’s looking to sideline that whole thing."

These staffing changes come at a critical time for Tumblr. Business Insider reported last week that Mr. Karp was in Silicon Valley "raising a big round of funding," even though it "doesn't need to raise more money." However, according to a profile in Forbes from January, Tumblr generated just $13 million in 2012, despite traffic of 18 billion page views per month. Forbes also noted that Tumblr shelled out an estimated $25 million in operations in 2012 and expects that figure to increase to $40 million in 2013. The company, which is headquarted in a cushy Flatiron clubhouse, last raised funding in 2011: $85 million at an $800 million valuation. Up until the end of 2012, Tumblr reportedly had a burn rate of $4 million to $5 million a month, before transitioning to its own data center, which lowered the burn rate to $2 million a month.

Given those financial concerns, some seem puzzled at the board's faith in Mr. Karp. "The fact that Tumblr is losing its most experienced people, at a moment when it wants people to believe it's succeeding in a big way, suggests some real incompetence on Karp's part," said a source.

The success Tumblr wants to project--as its Silicon Alley cohorts are trying to avoid down rounds--is related to the monetization strategy it launched for first time last year, which relies on native advertising via the Tumblr Dashboard, rather than traditional display or keyword ads. As head of sales Lee Brown told Bloomberg recently, brands pay for prominent placement of their posts, acting much like other users on the service:

“Marketers have become accustomed to buying scale as opposed to earning it,” Brown said. “We’re not really selling ads, we’re promoting their content.”

That approach has managed to attract big brands like Target, Coca-Cola, Adidas, Lions Gate, and Christian Dior, who average purchases of "just under six figures." Tumblr has begun offering the same service on its mobile app, which it says should lead the company toward since first annual profit since launching in 2007. But often the posts featured in the prominent Tumblr "Radar" spot on the dashboard come from regular users instead of brands, as evidenced by this unofficial archive.

One source was skeptical of the company’s emphasis on pageviews and number of blogs, given its advertising approach. "It has no strategy for monetizing anything other than logged-in dashboard users. Those numbers are much, much lower than what Tumblr's PR would suggest. So they're basically spending VC money to provide a free blogging platform, the vast majority of which can't be monetized."

Others disagreed with that assessment. "Monetizing the dashboard, actually, is the smart move. Why go and try and do deals with 100 million blogs, and share revenue, when you can just monetize the dash, which is bigger and you totally control?"

If Tumblr is indeed seeking another financing round, investors will no doubt be paying attention to its ability to monetize, as well as traffic itself. In November, Mr. Karp boasted that Tumblr had cracked Quantcast's list of top 10 U.S. websites. (It fact, Tumblr mistook the "top ten" badge on Quantcast as its website ranking. Instead, it had cracked no. 9 on Quantcast’s list of top networks and no. 15 on Quantcast’s list of top sites.)

Currently, Tumblr is ranked no. 21 in the top websites. A Quantcast graph shows that traffic appears to be plateauing, bolstered by an uptick in mobile users.

This story is developing, please email tips@betabeat.com with further information.

(Screenshot: Google Reader)

Fretful newshounds and anxious bloggers can stop sitting shiva. Digg, or rather Betaworks' reboot of old Digg, wants to resurrect yet another ailing online mainstay. On its blog this afternoon, the startup announced it would be building a reader to replace the "much-loved, if under-appreciated" Google Reader.

In the post, Andrew McLaughlin, the former vice president of Tumblr who joined Betaworks as an entrepreneur-in-residence last summer, said Reader's "early social features were forward-thinking and hugely useful." However, as with the revamped Digg, the new iteration won't look exactly like its predecessor:

"We hope to identify and rebuild the best of Google Reader’s features (including its API), but also advance them to fit the Internet of 2013, where networks and communities like Facebook, Twitter, Tumblr, Reddit and Hacker News offer powerful but often overwhelming signals as to what’s interesting. Don’t get us wrong: we don’t expect this to be a trivial undertaking. But we’re confident we can cook up a worthy successor."

He also assured fans of the revamped Digg--and the traffic it brings!--that this won't impinge on their aggregator, implying it will function separately.

Betaworks already has some skin in the reader game. It owns a piece of the real-time tech company Superfeeder, which fetches and parses RSS or Atom feeds, as well as Bloglovin', a service that lets you know when the blogs you want to follow are updated. Both startups made a plea to bereft Google Reader acolytes today. It's also worth noting that Betaworks companies do tend to collaborate--like Bitly and Chartbeat.

In cased you missed all the service journalism, there are already a myriad of alternatives--although it's hard not to watch them fall short when compared to the "800-pound gorilla in the RSS space." As a positive sign for Digg's own attempt at a better reader, the company is welcoming input from the yearning masses, struggling to blog free. Says Mr. McLaughlin:

In order to pull this off in such a small window, we’re going to need your help. We need your input on what you want to see in a reader. What problems should it solve for you? What’s useful? What isn’t? What do you wish it could do that it can’t today?

Fair warning to Digg, you're soliciting input from a pretty vociferous bunch, who could give a shit whether their problems are universal concerns.

Bloggers who have spent years painstakingly curating feeds, lovingly organizing them into folders based on urgency and topic, may have even come to think of their top-secret feed resources as the modern day counterpart to the source rolodex. Asking to see a fellow blogger's Google Reader is basically like asking them to share their sources--something that many would feel territorial about.

Though many may decry the downfall of RSS, for those who spend time sorting through large swaths of information and consuming as many news items as possible, Reader was a simplified way to sort through the noise (though that 1,000+ number was always pretty overwhelming).

The Betaworks team seems well-suited to revive RSS. In fact, they might want to make Lazarusing web 1.0 a full-time thing. Guess that would make them Internet Jesus?

Mr. McLaughlin

On his blog this afternoon, Andrew McLaughlin, vice president of Tumblr, revealed that he would be leaving the micro-blogging platform after just nine months to join Betaworks, an early Tumblr investor, as an entrepreneur-in-residence. Investment firms often tap employees at portfolio companies for that role. Recently, for example, Andreessen Horowitz poached Foursquare vice president Tristan Walker for an EIR position out in Silicon Valley, although Mr. Walker had clocked almost three years at Foursquare at that point.

In an interview with Betabeat, Mr. McLaughlin assured us that the move was "on friendly terms." 

"No great drama to it!" Mr. McLaughlin explained, "Betaworks is a thing I've been fascinated with for a long time, and I got the opportunity to go dive in and work with John Borthwick." Mr. McLaughlin and the Betaworks CEO have been friends for a number of years. "Excited to have Andrew @betaworks," Mr. Borthwick added by email, calling Mr. McLaughlin, "Super smart, thoughtful and a passionate believer in entrepreneurs."

Mr. McLaughlin joined Tumblr after its massive $85 million series E round last fall, which valued the company at an eye-popping $800 million. "Part of the idea was that I would come in and work on a couple of defined things--international strategy, sorting out the organization for the non-engineering side of the company. And I feel like that stuff is in relatively good shape," said Mr. McLaughlin. "I hired a bunch of people, put into place some structure, checked off a bunch of the things that we wanted to do. I kind of had the itch to work on even earlier-stage companies. During this experience I got at Tumblr, I feel even more confident in my abilities to do that now."

Mr. McLaughlin already boasted quite the résumé. He is a former head of public policy at Google, joining as the team's first member in 2005. He also served as the deputy CTO for the Obama administration, in addition to helping launch Internet Corporation for Assigned Names and Numbers--better known as ICANN--where he climbed the ranks to vice president and chief policy officer.

Mr. Borthwick said that Mr. McLaughlin will be "working with us on all our companies." However, Mr. McLaughlin was careful to emphasize that he will keep working with Tumblr on "whatever David wants," he said. "I'm sort of on tap to advise David--or anybody else at the company, but it's primarily been David that I wanted to keep working with."

As part of his role at Tumblr, Mr. McLaughlin focused on the company's international expansion into different languages, which he'll be bringing to bear in his role as EIR. "I've got a lot of experience with Google's growth phase and internationalization in particular and so, for a number of these early stage companies, figuring out how to handle scaling on the organizational and business side--particularly when they feel ready to go international--is something that I know reasonably well."

In Brazil, Portugal and the Netherlands, Tumblr tried out different strategies, which Mr. McLauglin described as a "heavy push, medium push and light push."

"We experimented with different ways to get attention in order to get more users," he explained. "In Brazil, it was a big meetup in Curitiba, the location of the biggest Tumblr meetup last year, and we decided to kind of reward that in a way ... And then we did parties aimed at journalists and tastemakers, if that's not such a cheesy word to use--influencers in São Paulo and Rio that focused on the local Brazilian creative communities and people that were making really interesting use of Tumblr. In the Netherlands, we did a very low-key event with David, and in Portugal, we did a low key event without David," partnering with Vice magazine.

Rather than, "adding a ton of offices and hiring a lot of staff overseas," Tumblr focused on adding content and the ramping up the infrastructure for localization. "We hired up a two-person team in Brazil and have one person in Berlin, but otherwise Tumblr is all in New York."

Mr. McLaughlin's other big initiative during his tenure at Tumblr was the editorial side. He hired Chris Mohney from Blackbook and Jessica Bennet from Newsweek to launch a number of blogs. "The most notable of those is Storyboard, but also some departmental blogs, beefing up the content on the staff blogs," he said, enforcing Mr. Karp's notion that Tumblr is first and foremost a media company. "I'm super-psyched about that," Mr. McLaughlin said. "I just think it's gone really well. They've produced incredible content. I don't even think they get the recognition for how good Jess's writing has been or some of the interviews they've done."

Was Reblorg, a site to highlight "original, creative content" his idea as well? "No, that's Chris Mahoney," Mr. McLaughlin said with a laugh. "All credit goes to Chris and Jessica for that."

As for which Betaworks portfolio companies he might be working with, Mr. McLaughlin wasn't sure. "I literally just started. Ask me again in a couple of weeks," he said, adding, "It's a similar thing to what I did at Tumblr, where I kind of worked on whatever David needed, that's kind of similar to how I'm seeing my role as EIR."