Square Seen as Possible Buyer for Yik Yak

After its attempts to foster anonymous chatting faltered and led to abuse, Yik Yak tried to recover by beefing up moderation, implementing language coding to spot bullying and introducing a college campus-focused, group messaging app called Hive.

But the company is now looking more like a typical Silicon Valley flameout, where a fiery rollout ends up burning investors. A key problem has been the company's inability to come up with a way of making money.

Now Sequoia Capital is shopping Yik Yak around to a number of potential acquirers, according to a report from Fortune.com. Payments company Square (SQ) is one potential buyer, according to Fortune and a second report from the Verge.

A deal could come in the form of an "acqui-hire," where Square or another buyer would hand over equity to acquire Yik Yak's employees and IP assets. In such a deal, though, the purchaser would not continue to develop Yik Yak's technology and the app would shut down, according to the Verge. 

Yik Yak raised $73.5 million in three funding rounds (Sequoia contributed $62 million) in 2014, the year co-founder Douglas Warstler sued co-founders Stephen Buffington and Tyler Droll for allegedly using corporate chicanery to maneuver him out of the company.

In September 2014 Yik Yak was the third most downloaded iOS app, a peak it soon fell from.

The Warstler suit settled out of court in early 2015, and during the year Yik Yak became a well-known venue for bullying and trolling.

Its popularity declined and the company laid off 60% of its staff in December 2016, leaving it with about 20 employees. Original CTO Tom Chernetsky had already stepped down by that time.