And as Ben Horowitz would eloquently put it: “Dolla, dolla, bill y’all.”

Yahoo’s acquisition of Tumblr for $1.1B is the talk of the town lately. The biggest venture-backed tech sale to ever hit New York. And as I experienced twice the New York entrepreneurial and startup ecosystem, most recently two weeks ago through the World To NYC program (more on that on a later post) while not having fun with Google Glass, and one time last summer when I interned for Daily Secret, allow me to ponder on a short post about the importance of this exit. Not only about New York itself but, mainly, about every other startup ecosystem out there; the one I’m based currently in Vienna, and most importantly about the one back home in Greece; the one Athens.

Let’s forget for a moment all the cool profiles and features about David Karp; or how Tumblr evolved, why it, by most accounts, struggled to grow revenues (and the list goes on) and let’s focus on the business and the micro-economics side of things. (If it’s not ‘micro’ please do let me know and I’ll right the wrong.)

How big was the deal?

Pulling the data from Crain’s excellent story:

The $1.1B deal will net for Tumblr founder David Karp more than $250 million. Union Square Ventures of the great Fred Wilson will total a return of 5,000% which translates to $253M, mostly from a $400k seed investment back in 2007, while USV’s total investment is estimated at less than $5 million.

Boston-based Spark Capital of Bijan Sibat will net $231M — $77M of them going to Sibat himself (if I understood it correctly.) $231M translates to an astonishing 4,000% return.

Sequoia Capital from Silicon Valley, known for funding Apple among other Valley behemoths, will see a total return of 700% — $176M in just three years.

Tumblr employees also got a fair share of equity back in the day, thus we have: the first 10 employees will receive an average of $6.2 million in cash (I think here ‘belongs’ Marco Arment,) the first 30 will receive an average of $3.3 million (again, cash) and the rest of the 178 employees will each receive $371,000.

Now, if we pull Sequoia out of the equation because it’s based in Silicon Valley and keep Spark Capital in because it’s based in Boston and invests in East Coast, hence also New York, we have a total of $959,183,000.

C.R.E.A.M. (Cash Rules Everything Around Me)

$959,183,000 is a lot of money. Let me elaborate why it’s important for the New York ecosystem. Because this amount, diversified among investors, founders, and employees, will be recycled in the future into the New York tech startup ecosystem.

Tumblr employees will go to start their own companies (if they’ll succeed or fail is completely irrelevant for now), Karp himself can become an Angel with $250M, Fred Wilson through USV will have another $250M to invest. They will create new jobs, companies, they will generate new investments. The big picture is that this huge amount of money will be reinvested back into the next generation of New York City startups.

What about x-ecosystem?

If you read Tech and the City by Alessandro Piol and Maria Teresa Cometto, foreworded by Fred Wilson himself, the chronicles of the New York tech scene since its very proto-beginnings in the early ’90s (thanks for the gift, World to NYC!) you’ll understand that it took many years for New York to become what it is today — to actively challenge and be #2 in the US after Silicon Valley with just a fraction of lifetime.

Of course, Mayor Bloomberg helped a lot with many initiatives but the real work comes from people like Fred Wilson who invested, lost everything, and then re-invested in this ecosystem — and of course the founders themselves. Exit-success stories are needed to generate previously not available cash, distribute it among key players of the ecosystem, who will reinvest it in the next generation of entrepreneurs. This is how an ecosystem is truly born; everything else is pomposity and fanfares.

Don’t get me wrong: events, community building, co-working spaces, hackathons, you name it, are indeed important but not a) sustainable, and b) enough in and for the long-run. A round of few exits from true doers despite all the uncertainty and chaos that surrounds them are (or a couple very big success stories — the difference doesn’t matter) important for the longevity of a given ecosystem and true enablers of its potential. Athens, Vienna, take note.