The co-founders of Instagram built a powerful and useful tool for recommending news to readers, but they weren't able to fully scale it. Yahoo has hundreds of millions of readers, but adding some tech-enabled cool could help it differentiate itself from the internet's other news aggregators. The companies made the announcement on Tuesday. With Yahoo's acquisition of Artifact, the two companies will be joining forces.
The two companies declined to say how much they would pay for the acquisition, but did clarify that Yahoo is acquiring Artifact's technology, not the team. Artifact co-founders Mike Krieger and Kevin Systrom will become “special advisors” to Yahoo, but will not be joining the company. The rest of his five employees at Artifact have either taken other jobs or will be taking some time off.
The acquisition comes a little more than a year after Artifact's launch and about three months after Systrom and Krieger announced its death. “We have built something that our core user group loves,” the co-founders wrote in January, “but concluded that the market opportunity was not large enough to justify continued investment in this manner.” They said the biggest reason for closing is to focus on “something newer, bigger and better that can reach millions of people.” The bet behind Artifact was always that AI could become the huge technology that changes the internet. Perhaps there were more interesting initiatives than a news app that doesn't have a large news audience.
Mr. Systrom and Mr. Krieger posted the memo without pitching the company to potential suitors or raising money. They were the only investors in Artifact, ran a fairly lean business, and felt it was safe to move forward. But then I started getting calls from companies. Systrom said he had “about 10” conversations with other businesses after the closure notice. “A lot of organizations are very focused on news and personalized content. And they look around and say, “Wow, there's a new wave of AI coming… to understand what's going on.'' I think that's probably what I discounted at first. ”
Artifact received many calls after announcing closure
Yahoo was one of those phones. Yahoo News general manager Cat Downs Mulder said the company only began considering acquiring Artifact after reading the closure notice. “They put a lot of love and care into the way their content classification and recommendation system works,” she says. “How content is categorized, what signals are fed into that content, how to identify what actually works and is connectable and what is relevant, and how to connect users to their content. Yahoo has been working on personalization and recommendations for a long time, but Artifact has built something special.
That's what Artifact brings to Yahoo. What will Yahoo offer Artifact (besides an undisclosed acquisition price)? Highlights. More than 185 million people access Yahoo News every month, according to Downes Mulder, and Artifact's personalization and recommendation technology reaches far more users than it could have achieved alone. It is said that it has been done. For Systrom, it's also a chance to see it in action. “Every month we took a little bit of growth,” Systrom said. just Large enough to make them work. But it was really difficult to move that needle. ” The integration with Yahoo will happen slowly, but it will be a significant change in direction.
The app, Artifact, will be deleted once the retrieval is complete. But Artifact's underlying technology for categorizing, curating, and personalizing content will soon start appearing on Yahoo News, and eventually on other Yahoo platforms. “We're going to see that trickle into our products in the coming months,” Downs-Mulder said. It seems like there's a good chance that Yahoo's apps could also gain a bit of Artifact's speed and sophistication over time.
Both Systrom and Downs-Mulder say integration will take time, and they can't just drop an artifact algorithm into Yahoo News and call it a day. But they see the possibility for everyone to get to the future a little faster. Yahoo can develop an ecosystem of personalized content called “TikTok for Text” that was very appealing to Artifact users. And Artifact can power future news services.
Meanwhile, Systrom says he doesn't know what will happen next. He is focused on ensuring his transition to Yahoo is successful, and he and Krieger are always thinking of new ideas. He said he remains as bullish as ever on AI, asking big questions about what the world needs in an era of large-scale language models. But “starting a business is not a seasonal business,” he says. “I don't like starting something new every fall.” The idea for Artifact felt too good to throw away. Now he's looking for his next idea.
Updated April 2nd at 9:55am: This article has been updated with the latest user numbers from Yahoo News.
