While we are sitting on RZ he's probably sitting on a couple million... Haha how's it make ya feel?
He was already luxuriously wealthy. A few million mean nothing to people who have hundreds of them already.
But the story you're paraphrasing is meant to create hype, surely to try to upsell this for Yahoo's sake.
The real story is that around 12, Nick learned how to code which isn't abnormally young, so it's nothing to write home about. At 15, instead of just making poop for himself like everyone else who learns to code early on, he had an idea to tldr long articles. His initial implementation was generally considered completely worthless and the app itself was quite terrible as many users have pointed out. So he didn't do anything really amazing.
What is amazing is that at 15, because his family is very wealthy/connected, due to his age, they were able to drum up media attention about the idea. They sold the idea, not the implementation. Then they got investors involved to improve things. Along with this, they hired a lot of really senior people in the field and hired a research company called SRI to do most of the R&D into developing an algorithm to do significantly better than the really crappy application he had written. Now we're talking about a company burning multiple millions per year on staffing costs and R&D contracts alone -- and it's not known whether they kept the patents or SRI got to keep the patents (that's up to the contract that isn't public).
So a few years later, with a lot of talent acquired and enormous amounts of money pumped into the company, they have something that most people are reviewing as "not that good." The idea is a pretty good idea, and someone can probably do a lot better, but it is far from what the media hype would have you believe. The kid did not sell his app for $xx million. His app was basically trashed years ago. The kid sold his company for $xx million. A company built largely from affluence and being well connected, with a decent idea and a barely passable implementation.
It's entirely unclear what Yahoo wants from this purchase. The technology isn't that impressive in its current state -- and it's probably patented by SRI so Yahoo would still have to pay licensing fees (which raises the question: why purchase a company when you can just license the patents independently and have much more capable engineers implement them). Nick himself is being lauded as some kind of superstar programmer but there's no evidence whatsoever to support these claims. He's had less than 5 years experience coding at all -- I've never met someone with 5 years experience in coding that could engineer even simple things very well, and it sounds like this application was only built very well after a team of very experienced engineers was procured. So Yahoo either did it for the talent of the team, or for the story, or a little bit of both.
But it's still a bad move either way. I see this as a terrible purchase by Yahoo, since the application is largely vaporware, hyped by the news and celebrity connections created by the founder's affluence, not by the product itself. The team took a good idea and made a barely passable implementation -- not a sign of world-class anything. And any algorithms are probably tied up in patents. So they paid $xx million to buy a few engineers, a bunch of executives (this company has a very high executive:engineer ratio, which indicates something very fishy about funding, and likely means > 80% of the company's valuation is tied up in like 4 people rather than those who actually built it). This would piss me off if I were a Yahoo employee, and it's summarily not impressing the tech community, with almost every response on HN and other tech news sites being net negative, both towards Nick and Yahoo. What a miserable failure.
But cool, the rich kid and his executive team of mid-50 something talentless morons all got a few million dollars. How exciting.
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