
How Marissa Mayer Failed to Turn Yahoo Around - bane
https://variety.com/2016/digital/features/marissa-mayer-yahoo-ceo-1201781310/
======
exelius
I don't think the failure is on Mayer; Yahoo was a walking zombie before she
arrived. They were the last remnant of the dot-com boom -- a media company
without a significant role in content, advertising, shopping or computing.
They had no technological advantage, or really any foundation for a
competitive advantage to set them apart from the rest of the market.

Quite simply, Yahoo was culturally never a technology company. They defined
themselves as a "media" company in the mid 90s to avoid drawing Microsoft's
ire, but they said it for so long they believed it. They underinvested in
technology throughout the late 90s and early 2000s, and by that time Google
was the behemoth that Yahoo should have been. Yahoo is only around today
because they recognized the emergence of China and made a lucky investment in
Alibaba. Without that investment, Yahoo would have gone bust years ago.

~~~
simonsarris
I think there's plenty to make a case that Mayer specifically was a large
negative vs Yahoo on twin-earth where someone else was CEO.

Many(?) aquisitions were her plan. From the article:

> goodwill impairment charges of $1.2 billion

This means since 2012 Mayer has overseen the aquisition of companies for at
least $1.2b _more_ than their book-value worth, and now that value is gone.
Paid a premium for brands and then lost the value of those brands.

~~~

> “She believes she can figure it out on her own,” says a former top Yahoo
> exec. “Her attitude is, ‘I watch TV shows, so I know TV shows.’” Mayer hired
> Katie Couric — in a deal reportedly worth up to $10 million per year, mostly
> in stock — because she personally likes the former TV news personality,
> without a sense of where and how Couric’s brand would appeal to Yahoo’s user
> base

~~~

> Mayer was gung-ho on expanding Yahoo’s media business, particularly in video
> entertainment, approving a Netflix-like slate of scripted original series
> with a seven-year business plan to recoup the investment

> Yahoo formally exited TV-style entertainment in the third quarter of 2015,
> taking a $42 million write-down on [original series, deals, then axed Yahoo
> Screen division]

Her plan.

~~~

> Yahoo in February folded seven digital magazines, including titles covering
> food and travel, which had been a Mayer pet project. She wanted to launch
> dozens of vertically oriented magazines, dictating that they use Tumblr-
> based designs, hoping to better monetize Yahoo’s monthly audience.

Her plan.

> Mayer has positioned those closures as a refocusing on Yahoo’s four
> strongest content segments — news, sports, finance, and lifestyle — as the
> company aims to cut 15% of its workforce over the course of 2016. But those
> were the areas on which Yahoo should have stayed laser-focused all along,
> according to S&P’s Kessler.

~~~

She had ideas that were either unworkable, poorly implemented, or she was
unknowledgeable and hired the wrong people.

> I don't think the failure is on Mayer

That's how this works. She had a job and failed. It's okay to say that. They
aren't paying her to _not take responsibility._ They will be paying her more
than you and I and many readers of this comment combined may ever make, just
to leave.

~~~
LogicFailsMe
Or in other words, she tried to run Yahoo like it was Google. My experience at
Google led me to see it as a bunch of poorly executed clones of trendy
startups that never ship.

However, their insane ad revenue keeps the boat afloat, and allows them to
fund moonshots and failures. Yahoo doesn't have that insane revenue stream so
that strategy didn't work out so well there. Am I missing something?

~~~
Bartweiss
I don't think you're missing anything.

That quote about "throwing rocks" in the article is misleading - Google has
done exactly that and succeeded. Their trick is that they're standing in a
quarry and don't have to give a damn how many rocks miss as long as they get
the occasional hit. Mayer carried over that philosophy to a company with half
a dozen rocks and nowhere to get more.

It's telling that Mayer never really revealed a 'plan' for Yahoo ('content'
and 'advertising' don't count). She bought a bunch of things, tried a bunch of
deals, and clearly expected value to shake out somewhere like it does for
Google. But Yahoo doesn't have the time, revenue, or infrastructure to slot in
a stream of experiments and wait for a win - their only attributes were staff
and users, and they needed to consciously turn that into money. It's closer to
Facebook's monetization task than Google's, and regardless of her talent
Mayer's background was an impediment to what needed to happen.

~~~
malisbad
I had come here to say this. Look at all the products left dead in Google's
wake. Wave is probably one of the biggest "before its time" products that got
destroyed, amongst others.

------
erez
"The Yahoo way is, ‘We’ll throw 10 rocks against the wall, and maybe one of
them will hit the bull’s-eye. But you need a sniper rifle in this business."

That's a load of crap. If anything, 'this business' showed us what you need to
do is grow to a level where you can throw not 10, but 100 rocks against the
wall, and once one of them hits, get another 4 dozens and hurl them at the
same spot immediately.

~~~
2close4comfort
Just goes to show that even if you did work/worked at Google you are really no
better than anyone else...and planning on that to bring your business around
may not actually be a plan.

~~~
lintiness
she parlayed not being any better into quite a payday. give the girl some
props!

~~~
Phlarp
Got a big payday, advanced the resume significantly and had two children.

I think she should be applauded for those things personally, even if Yahoo was
a sinking ship she couldn't save.

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1024core
You know those algae blooms that block off all sunlight and kill a pond? Yahoo
has that in the form of middle managers. Marissa's biggest (and perhaps even
the only) mistake was to not get rid of this oxygen-depriving algae. Had she
eliminated the middle-managers and meeting junkies, she could have liberated
the engineers to actually deliver some solid products.

// source: wasted many years of my life at Yahoo, left after Marissa came and
I realized that she was being hoodwinked by the manager-types.

------
jbail
Remember when Mayer banned remote work at Yahoo? She still defends that choice
even though she has clearly failed to prove her thesis that you need to sit
next to someone collaborate successfully and deliver improved business results

~~~
Bartweiss
I've always suspected that people took that decision too much at face value.
Yahoo needed to make staff cuts, and too many layoffs are bad for the share
price. Convincing all the remote employees to quit lets you claim "there's a
plan!" while quietly thinning the ranks. The catch is that it doesn't work if
you state your real reasons.

~~~
ng12
The problem is many of the remote employees were the truly valuable ones.
Talented engineers get spooked pretty quickly and a flexible work schedule is
a very good reason to stick it out at a struggling large company. The more of
those reasons you take away the more you'll find yourself with less desirable
engineers.

~~~
Bartweiss
Definitely - I don't think this was a good decision.

The only reason it might have looked good enough to take is that axing remote
at a stroke gets pretty much everyone, good and bad. I suppose a few
young/single/unemployable people might move to the office, but my memory was
that Yahoo lost most everyone who was remote.

That's marginally better than the usual "make the workplace intolerable"
option, where you lose exclusively the good. Of course, it's still much less
good than actual dismissals, where you (hopefully) keep the good engineers in
particular.

------
throwaway4123
2 years from now-

Twitter's False Prophet: How Jack Dorsey Failed to Turn the Company Around
(wsj.com)

HN top comment: I don't think the failure is on Jack; Twitter was a walking
zombie before he arrived. All the engineers left after writing their own
version of popular well designed Scala libraries like Akka and Spark and Play
because huge ego. They stuffed these rewrites into monorepo which came
crashing down. The engineers ran away and Jack turned off the lights.

------
GantzGraf
I'm fascinated by the vitriol directed at Marissa. A lot of people seemed to
take her hiring and subsequent performance as a personal offence to them.

~~~
CaptSpify
It's a couple of things from what I've seen:

A) That she was paid so much money. A lot of people could have "not succeeded"
for a lot less than what they paid her.

B) Her attitude. I have never dealt with her, and am only basing this on what
I've read: She seemed to push a lot of bad policies, that made employees
upset, with the attitude of "All of this pain is for the Great Reward of
turning Yahoo around." Yet at the end of the day, it seems that their
sacrifices were for nothing.

She talked big, but never delivered, and is making out quite successfully, for
failing. Meanwhile the real brunt and struggle was pushed onto the employees.

EDIT: I also think this resonates with a lot of people, as most of us have had
similar execs. "No, we can't afford another server, you'll just have to work
harder. Guess you'll just have to work through the night! Oops, it's 5 p.m.,
time for me to head out to my company-paid steak dinner, in my company-paid
car, then time to head home to my company-paid apartment!"

~~~
Tomte
Ad A: on the other hand, few people here complain about the outrageous amounts
of money that some founders have made.

Yes, they built something. Still.

~~~
CaptSpify
? I'm not sure what you mean. I think most people have much more respect for
founders because they start from scratch and turn it into something. She
didn't start from scratch, and she didn't turn it into anything.

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drdoom
> When she was at Google, Mayer oversaw the approval of each daily homepage
> “doodle.”

I love this new career path. Beats working years just to advance to manage
your old team.

Now I can see the logic behind all the attention on emojis at the Google I/O
event. They will be our new leaders.

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lintiness
$117M over 5 years with $37M paid in year one: human beings have a real need
for "leaders" and pay dearly in their search (pardon the pun).

------
leroy_masochist
It's interesting that people only get mad about golden parachutes given to
"rock star" CEOs when things are going poorly for the company that hired them.
I feel like we should do a better job about calling out these agreements
whenever they're inked; it's publicly available information in the case of
publicly traded companies.

Some kind of severance guarantee for the new CEO in case they get fired, OK, I
get it. You need to keep your kids in private school and continue to pay your
mortgage for the period of time while you find something else to do, fine, no
problem. I'd even be fine with a healthy multiple of what that kind of
expensive lifestyle costs for 6 months. In Mayer's case I'd even say that a
million bucks might be justified, given that it will probably take her a while
to find something else to do.

But an agreement that will likely soon result in a $55mm payment to an
outgoing CEO who has spent nearly 4 years pissing money away in bad
acquisitions and destroying value across multiple verticals is absurd.

~~~
a_small_island
The theory is that no one good would take the job because the likelihood of
failure was so high without a parachute. This type of ousting will certainly
hurt Mayer's future CEO options, or so the theory goes.

~~~
leroy_masochist
I guess it depends on how you define failure. I agree that elevating Yahoo to
its previous place in the SV hierarchy would have been a tall order, but I
think that prudent management of healthy business verticals combined with a
conservative and thoughtful approach to acquisitions would have been pretty
doable.

------
Tloewald
Yahoo got where it was by being the first directory on the web. It was
terrible — to get listed you had to submit an application and then whether and
how you were listed was based on someone's arbitrary decision. It was like The
App Store (hint to Apple — how'd that work out for Yahoo?).

Yahoo then failed to fix its shitty directory (it eventually licensed results
from third parties) and built a successful ad platform that was never bleeding
edge. Meanwhile Yahoo passed on Google and Facebook…

~~~
cableshaft
While I agree the App Store has it's fair share of issues, they do at least do
more than 'here's the category an employee determined you should be, buried in
subcategory after subcategory, and this is the only place people will ever
find you' that the early Yahoo had.

They have dynamic lists based on sales and downloads (which has its own
issues, admittedly) for every category that may be algorithm-based but has no
human making arbitrary decisions for each individual app.

They also choose certain apps and feature them on the front page of the app
store, which changes every week.

They also let developers choose their categories (instead of employees
choosing the categories), and developers can choose more than one category.

They also let developers pick keywords (with some limitations) for users to
find the apps via search terms.

Each app page has its own url, so it can be landed on via other methods
throughout the web.

So all in all, it's very different from early Yahoo, and significantly better,
and all of that would be plenty if they had like 1% of the total number of
apps that they do, but they don't, so way too many apps get buried and
unnoticed.

------
drdoom
Some people caught on earlier to the direction she was going (i.e., down). It
was so alarmingly clear that some journalists even floated the idea that she
may in fact be an agent of a competitor to bring Yahoo down. In other words,
she was suspected of being an insider agent working for the other side.

------
googletazer
She got several millions out of it. The engineers might have been buried but
hey at least someone came out on top.

The only chance for yahoo was promoting someone from within not bringing a
"professional" CEO that will jump ship in a few years.

------
funkyy
I wonder if people blindly defending Marisa and painting her as a female hero
will finally ope their eyes and see clearly that she is - at most - a very
average CEO... Yahoo needed someone amazing and it failed to find one.

~~~
exelius
The problem was that someone who was skilled enough to have taken on the job
of turning Yahoo around would have just started their own company -- without
the baggage of Yahoo's culture. VC is easy enough to get that any tech
executive capable of a Yahoo turnaround would have had no trouble raising
$50-200 million. Anyone capable of the job also probably wouldn't be
interested -- Yahoo does not play in any big growth markets right now.

~~~
Bartweiss
Even for a CEO who wasn't looking to found a company, Yahoo can't have been an
attractive bet.

Jack Dorsey was (apparently) in the market for a job change around 2011, was a
two-time winner already, and has since shown that he's willing to take on
turnarounds. Sounds great, but I can't imagine what offer would have gotten
him to take over a bloated, directionless horror like Yahoo.

The entire job offer was an ugly one only suited to people without the
independence and focus needed to succeed at it. Someone market-savvy enough to
claw out a profitable place for Yahoo was bound to have options that didn't
require mass layoffs and managing a dozen nearly-worthless side products.

------
mwsherman
I don’t think there is a strong case to be made that the CEO matters much
here. We’d need to see the counterfactual of what would have happened in her
absence. Maybe the same, maybe better, maybe worse.

And in any case, there is no reason to believe that Yahoo’s or any tech
company’s continued existence is normal. Yahoo was of a time, as was Digg,
MySpace, etc.

It’s easy to say they “screwed up”, but success for any amount of time is the
exceptional part. Regressing to the mean of “non-existent” or “not valuable”
is…normal.

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nickpsecurity
I would call it Yahoo's Failed Prophet given she made best attempt anyone had
seen in forever to get her people to the Promised Land in a few years after
they marched 20 extra years in the Wilderness in the wrong direction stepping
on what manna they received. Even Moses or Joshua might say "Screw this!" in
such a situation. Well, Moses basically did but you don't see people calling
him a false prophet. ;)

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spajus
I knew this would happen the minute she banned remote work.

------
known
Copy/Compete; Yahoo is doing neither;

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frade33
They are utterly 'irrelevant' i don't care if they make money or not. but they
are barely relevant. and this is actually worse than dying. They are
everywhere yet nowhere.

What exactly Yahoo is, can someone explain LIM5. and who their target
customers are consumer or corporate???

I am not talking their subsidiaries, just Yahoo. Alibaba is cool, but that's
not enough.

They are not even trying at anything. They are not even exploring anything.

All I can say, they can do better than this.

~~~
roymurdock
Yahoo! Inc., together with its consolidated subsidiaries (“Yahoo,” the
“Company,” “we,” or “us”), is a guide to digital information discovery,
focused on informing, connecting, and entertaining our users through our
search, communications, and digital content products. By creating highly
personalized experiences, we help users discover the information that matters
most to them around the world—on mobile or desktop.

We create value for advertisers with a streamlined, simple advertising
technology stack that leverages Yahoo’s data, content, and technology to
connect advertisers with their target audiences. Advertisers can build their
businesses through advertisements targeted to audiences on our online
properties and services (“Yahoo Properties”) and a distribution network of
third-party entities (“Affiliates”) who integrate our advertising offerings
into their websites or other offerings (“Affiliate sites”). Our revenue is
generated principally from display and search advertising.

We are proud of our rich history that has evolved with the Internet, beginning
in 1994 when our founders, Jerry Yang and David Filo, then graduate students
at Stanford University, created Jerry and Dave’s Guide to the World Wide Web,
a simple directory of websites to help people navigate the Internet. Yahoo was
incorporated in 1995 and is a Delaware corporation. We completed our initial
public offering on April 12, 1996, and our stock is listed on the NASDAQ
Global Select Market under the symbol “YHOO.” Yahoo is a global company
headquartered in Sunnyvale, California.

Seek and ye shall find:
[http://files.shareholder.com/downloads/YHOO/2121517153x0x893...](http://files.shareholder.com/downloads/YHOO/2121517153x0x893458/96E76DB6-C10F-4514-AAB0-24BFC488B422/yahoo_ar15_annual_report.pdf)

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dreamcompiler
Yahoo.com is the address I ping when I'm testing a new wifi connection. This
article seems to suggest they also have a website. Wow. Learn something new
every day.

~~~
stillusingvb6
2edgy4me

