Yahoo
VS
Joe Bongiovanni, Frank Natale, Parth Patel,
Jonathan Rego, Justine Young
March 1995
-Larry Page & Sergey Brin (Stanford)
August 1998
- First funding secured
June 1999
- $25 mil round of equity funding
March 2001
-(reluctantly) hire first CEO Eric Schmidt
-CEO tenure 3/01-1/11
August 2004
-IPO ->19.6mil share @ $85 ($1.7b)
-NASDAQ -> GOOG
April 2011
- Larry Page becomes CEO (current)
Fun Fact: “Google” the result of googol being
misspelled. (googol = 1 followed by 100 zeros)
January 1994
-Jerry Yang and David Filo (Stanford)
April 1995
-Two rounds of fundraising ~$3mil
April 1996
-IPO ->2.6 mil share @ $13 ($33.8m)
-NASDAQ -> YHOO
CEO History (8 total since 1995)
T. Koogle 1995-2001
T. Semel 2001-2007
J. Yang 2007-2009
C. Bartz 2009-2011
T. Morse 2011-2012
S. Thompson 2012
R. Levinsohn 2012
Marissa Mayer 2012-
Fun Fact: Originally called “Jerry and David’s
Guide to the World Wide Web”… changed to
“Yet Another Hierarchical Officious Oracle”
22.8%
24.3%
26.3%
$6.4B
$4.9B
Stable 15.1%
15.5%
25.6
5 year growth
Operating Profit Margin‘14
Net Profit Margin ‘14
Operating Cash Flow ‘14
Net Income ‘14
ROE ‘14
Cash Flow Margin ‘14
P/E current
Industry Avg P/E 32.3
6.5%
11.2%
13.3%
$111M
$166.3M
26.84% Volatile
3.4%
6.2
-
Started by 2 Stanford PhD Students in the early days of the internet (mid 1990’s)
Started as search engines
Started in a garage (Google) and a trailer (Yahoo)
Leadership
• Talent Management
• Acquisitions
• 163 Companies
• $28 Billion
• 15 Years
August 2005
$50 Million
Mobile OS
March 2008
$3.1 Billion
Online Advertising
October 2006
$1.65 Billion Stock
Video Sharing
Larry Page – CEO
- Larry Page walks into the lab…
- Willing to take risks
- Have a hand in everything
- Critical of the company’s
progress
- “Don’t be evil”
- Business for a better future
David Filo
Jerry Yang
Yahoo refused to be called a technology
company.
Flickr was valued as a database, not as a social
networking community and asset.
8 Yahoo CEOs in the past two decades
Tim Koogle 1995-2001
Terry Semel 2001-2007
Jerry Yang 2007-2009
Carol Bartz 2009-2011
Tim Morse 2011-2012 (Interim)
Scott Thompson 2012
Ross Levinsohn 2012 (Interim)
Marissa Mayer 2012-Present
A company as large as Yahoo needs clear
perception of what it stands for
and where it wants to go.
Marissa Mayer
• Great Student
• Excellent Academic Record
• Excellent History at Career at Google
– More Technical Exposure
– Employee #20 at Google
• Being new CEO of struggling enterprise
Marissa’s leadership skills and influential
effectiveness are questionable.
“Good students are good at all things?”
EQ is just as important as IQ.
• Lecturer hating to get feedback
• Micro-Manager
– Has more than 2 dozen direct reports
– Involved in all decision making processes
• Should not apply to everyone
– Instead, create trust and align values
– If you think workforce is unproductive, either coach them
or let them go
– Place isn't going to change people’s nature
– Google has more remote workers
• Each worker generate $931,657 revenue vs Yahoo’s
$353,657[2]
– Top talent will leave where they are more empowered
– classic way of treating the symptom and not the
problem
– Recklessness?
– Inexperience
– Regressive decision?
•
•
•
•
•
Lack of Trust
Inexperience
Arrogance
Insecurity
Poor Judgment
• It’s very different being employee number 20
than being the new kid on the block and
moving into a house that’s already on fire[1]
• Yahoo’s employees to feel a lot like abused
children
– They don’t know who to follow or what to expect
– Mayer has to earn the right to lead before she
leads
– No one is going to follow her until they believe
she’s going to survive
-In the world of the web business, it takes 100
observations to make one action
-Monetization through ad clicks
(~95% for Google, ~80% for Yahoo)
-Human minds require time to focus
http://www.cenedella.com/why-does-yahoo-fail/
Scan 100 headlines on a news site and read some THEN look through 100 profiles
on the dating site THEN look through 100 flight options and THEN look through
apartment listings on real estate sites, or….
Would you read one article, followed by reviewing one dating profile, followed by
reviewing just one listing of a flight followed by reading one apartment listing THEN
going back to read another article, another profile, another flight, and another
apartment listing THEN repeating this 98 times?
http://www.cenedella.com/why-does-yahoo-fail/
“to organize the world’s information and make it
universally accessible and useful”
Concentrated in one stack of
information – intentions – inferences – interactions
Too many different KINDS of things…
with too many different KINDS of customers… and despite
the evidence that all of these different options made their
customers brains hurt…
YAHOO!’s Leadership fail to have the guts or insight to
refocus on things the consumers can understand.