Marissa Mayer admits Yahoo should have bought Netflix instead of Tumblr
businessinsider.com
businessinsider.com
Through it's history Yahoo! had the opportunity to buy a lot of successful companies, but they lacked the foresight to do so and trusted too much in their existing business. For a brief period they did manage to attract really talented people though.
You're objectively incorrect in that opinion. They just reported 247M global paid memberships. Highest they've ever had.
Objectively Yahoo is worth $27.32 Billion USD, 1/7th as much as Netflix.
Watching Tumbler and Twitter die because individuals essentially decided they didn't want us to have them anymore has been informative.
Tumblr yeah. The general format of traditional blogging was already in trouble and Yahoo simply chopped off what that audience appreciated.
On one hand I don't think Twitter was ever profitable, so there's not much inventive to compete. But on the other hand, I don't think even Twitter can survive a decade of implosion. Bluesky may not be as big in 2030 as Twitter was at its peak, but if Twitter is legitimately dead it doesn't matter.
My cynical take is that microblogging also becomes a niche and "content creation" on Instagram/TikTok et. All takes over as refugees retrofit a different medium entirely to what they desire to do.
I guess this is why they say a turnaround CEO's job is to "get the wrong people off the bus and the right people on the bus", and why "turnarounds seldom turn".
I want to avoid making these mistakes for my startup.
Every company, when starting out, tries to avoid going down this path (recall Google's "don't be evil" or Amazon's "it's always day 1") but they all eventually lose the spark, after becoming large enough.
Large companies who have lost this spark eventually start hiring consultants and agile coaches in a desperate gasp to regain it (much like estranged couples hiring marriage counselors). This usually goes about as well as you might expect.
I've never found a counterexample to this principle. I think the only real way to avoid it is to stay small.
When a company gives out its control to 3rd parties that are not involved in what the company does, and only cares about financial statements, it loses its spark. Not because they decided to lose it but that's how the market forces act: squeeze out as much as possible, for as little as possible, and call it a good day.
The only counterpoint to that phenomenon is what some large-ish private companies do: stay private, don't get investment from external investors who haven't bought into what the company is providing as value to society, don't get investment from people looking to make their money 2-10x in a short period of time (short being around 10 years).
The moment a company enters squarely into the current financial markets it's doomed to just become a carcass of whatever vision it had, it's now just another commodity.
Edit: and every startup founder wants to be different and not fall for this, I don't think many manage, after some rounds of investment it's not in your power anymore to decide that, your VCs and other members in the cap table control you.
"Silicon Valley" is such good satire exactly because it depicts almost exactly how that happens.
What kind of people do you want to thrive, and what do you want your business to do?
The worst problems happen with a public listing. Your biggest shareholders will be fund managers. They are judged by how well they do in annual rankings. Their incentive is to make the share price go up over the next few months.
The only way to avoid it is to stay private.
Financial incentive structures are very hard to get right. People will always find ways of gaming the metrics.
Google's biggest problem c. 2004 was that the suite of opportunities available to it on the Internet was far more than it had skilled employees to capitalize on. So they enshrined "leadership" and "influence" into their performance review system. You got promoted first for showing that you had the independence to tackle complex problems on your own; then that you could lead a team of people to tackle an even more complex problem; then that you could train others on how to lead teams of people; then that you identify the next set of complex new problems worth tackling; and so on. Worked great as long as the Internet was a big growth opportunity with lots of virgin undiscovered territory. But then when all the basic problems users care about are solved, how do you get promoted? Well, first you have to cancel a product that's working well. Now you have a big glaring complex problem that needs to be solved, so all your people can get promoted, move off the project, and then it can be canceled for the next cohort of promotions. And so on, until the only skillsets that company leaders have are "canceling products" and "creating technical debt".
Google basically built a pyramid scheme into their performance management system.
The thing is, this incentive system works on the level of the whole economy itself. There were plenty of companies (and open-source projects!) that did not build a pyramid scheme into their incentives. LiveJournal. OpenID. Semantic Web. RSS. PubSubHubbub. Bittorrent. Freenode. Where are they now? Well, they didn't build a pyramid scheme into their incentives, so they got out-grown by companies like Google and Meta that did. And this pattern extends back at least to the Industrial Revolution. Why do we have unsustainable car-centric suburbs based on polluting fossil fuels? Well, that technology grew faster than alternatives and then used their newfound wealth and customer base to convince cities to dismantle their trolley lines.
If the exit strategy is to get acquired, don't worry about it. You will make money and get to leave before the mess begins.
If your goal is to go public, it's almost guaranteed that you will end up in this situation eventually. Most of the corporate insanity is driven by public company antics and having to show growth every quarter.
The two examples I think of when I try to come up with "companies that don't suck" are Patagonia and REI. Both are private. In the case of Patagonia, the founder has spoken out against the quest for growth as it's a driver of so many bad things. I don't know much about REI but I'm sure if they went public quality would go downhill as well.
You are either serving people or serving Wall St - in my experience it's not possible to serve both.
Don't do that.
Obviously these companies run, but it’s all done by maybe 10% of the workforce who actually knows what they are doing.
The VP didn't just say "no", but also ratted me out to like the six managers between me and him, and each manager thought it was a good use of company time to schedule half-hour meetings explaining to me that I needed to go through the proper bureaucratic channels because the VP's time is "extremely valuable". Honestly kind of poisoned the entire job for me.
It was ridiculous.
Every time I've done this, they've agreed to the change. If they don't, then I don't take the job.
Hope you did it anyway. No one should be able to tell you what you can do in your spare time.
I mean, I wasn't worried about them suing me for contributing to open source (it would be pretty hard to prove any real damages), but I think being fired would have been on the table.
Mayer was an engineer, and for some reason people thought she'd be a great CEO. Surprise, she wasn't.
Wasn't she really disliked within Yahoo!?
At least I could crash the company without costing the company hundreds of millions.
You would think that kills a company, but a big company can survive decades in that mode, just slowly riding the elevator all the way down.
By the way, after co-founding Jakarta, I was the one who brought him and Lucene into the ASF and the rest is history.
I'm too young to remember, but was there a clear business plan supporting search at the time? Obviously Google has since proven that capturing a major chunk of the ad industry has made competing on search very worth it, but I don't remember if that was evident at the time. But I feel like the ad leverage came later in Google's life.
Then if you're trying to decide whether to bet on search at the time, the payoff may not be as evident without that insight.
Wow that just drips frat house product manager!
If she turns around Twitter despite Musk's involvement, she'll be deified by MBAs everywhere.
After failing to do anything interesting, and getting a quarter of a billion dollars from Yahoo, she is now pushing some kind of smart phone contacts thing with AI.
What Yahoo should have done was try to capitalize on the growing negative sentiment against The Google, social media, and Big Tech in general. By that I mean that Yahoo should have revamped itself to be privacy-oriented. This wouldn't be easy to pull off since Yahoo was (still is?) an advertising firm, but at this point they don't suffer the reputation of The Google in terms of having so much data that they "know what you want before you know it." So, for instance, Yahoo Mail should have been retooled to use end-to-end encryption and promised to never read your emails or share with third parties. Yahoo Search should have essentially become what Kagi is today; a search engine that gives power back to the user. Yahoo News should have been taken off the homepage and scoped exclusively to the News section unless the user opts-in to keeping the news one the homepage. Their news product should also have tried to distance itself from being a chum bucket of celebrity gossip and legacy entertainment news (today they still forward Buzzfeed articles for cripes sake). Yahoo made one semi-decent move with LastPass Premium being a part of Yahoo Plus Secure, but the problem here is that LastPass is fraught with controversy, and it's a product that's more or less tacked on to the Yahoo brand rather than being a true part of it. No one wants a glorified trial for some software that may no longer be offered through Yahoo someday.
Would these changes have meant that Yahoo would maximize their profit? Certainly not, at least not in the beginning. However, it would give them a chance to become relevant and grow in the long term. Of course, I don't believe they're ever going to do that. They have been experiencing late-stage corporatism for most of their existence, and that's not going to change without getting rid of all the clowns from the C-level.
Everything about Yahoo for most of its existence screams design by corporate committee. Their ecosystem is in a better shape than it was, but it's still baffling just how safe they want to play everything. Their whole site screams Web 1.0 but without any of the Web 1.0 charm. Making Yahoo Mail a safe haven from the likes of Gmail would have been such an obvious win, in my opinion. Yet the former CEO of Yahoo thinks they would have been better off buying a company that succeeds an area where Yahoo proves to have sucked hard at?
https://www.emergingtechbrew.com/stories/2023/05/04/marissa-...
https://www.cringely.com/2014/09/30/one-way-maybe-way-yahoo-...
and follow up 2 yrs later:
If true, that smells like a root cause for how bad Mayer is at running tech.
¯\_(ツ)_/¯
I just don't get it.