Yahoo’s Marissa Mayer Stumbled After Secret Truce with Activist Investor

http://www.wsj.com/articles/yahoos-marissa-mayer-stumbled-after-secret-truce-with-prodding-investor-1466174597

by jackgavigan • 10 years ago

79 104 10 years ago

wsj.com

jasonshen• 10 years ago

Someone have the full text?

sikhnerd• 10 years ago

Hitting the |web| button above usually works (and did for me in this case)

choward2• 10 years ago

Holy crap. I had no idea that existed.

fridayoff• 10 years ago

Why are posts that require a sign in or subscription even allowed?

nemothekid• 10 years ago

Why do people who complain about wsj on every thread even allowed? Click the "web" link.

RUBwkVjwLsDKgPw• 10 years ago

Some of us are on mobile...

smcl• 10 years ago

I think if so many people complain about it then the link isn't very well known

jessriedel2• 10 years ago

It doesn't work for me on Chrome (which I usually use), but does on Safari (which I don't) I guess I have to clear my cookies or something?

I also support not submitting articles that require workarounds.

benologist2• 10 years ago

Flagging WSJ until they're shut out of HN will effect more change - they still gain SEO and popularity and social benefits from us using their contrived "trick" to leech off this community.

balls187• 10 years ago

Thank you for this. I learned something new today!

mathattack3• 10 years ago

Copy/paste the title into Google, and follow the link.

undecidedly• 10 years ago

I'd consider reading it if I didn't have to sign up.

kartD• 10 years ago

Just go a google search of the title and you can get around the sub-wall

jessriedel2• 10 years ago

This doesn't work for me on my default browser.

effingwewt• 10 years ago

You're being downvoted, but I heartily agree. I would have no trouble paying only for the "good" content, things I will like or know I want or feel a need to read. I really think some form of microtransactions are the way to go here. This is simply one article that is, to quote another comment, a "dead horse", and not something I'd be inclined to read. Had it been an article on, say, some breaking news, or interesting financial news even, I'd happily pay and continue reading. Blanket subscriptions are the new cable t.v. channel bundles. Even though you want 3, pay for 219. Perhaps they could offer both?

choward2• 10 years ago

It's lame that I have to use the google referrer trick: https://www.google.com/search?q=Yahoo%27s+Marissa+Mayer+Stum...

jszymborski• 10 years ago

another good one is archive.is/[url]

here's the full text: https://archive.is/glTH3

manigandham• 10 years ago

Why is it lame that the publisher would like to be compensated for their work?

icebraining• 10 years ago

It might not be, but it's kinda lame to link to it here since many can't afford to pay for every single subscription site. Maybe if there was an option to pay per-article, but until then, it's simply unfeasible.

bpchaps2• 10 years ago

Because it makes a very hostile environment for independent journalists.

joslin012• 10 years ago

She has defended her strategy by stressing that growth is the lifeblood of internet businesses.

Or, you know, utility.

It's funny how she defends all these acquisitions underneath some imaginary fable that growth == success. Google didn't reach where it is today because it grew fast -- it was able to grow because it has basic utility and was known as the best amongst the competitors.

The key question for Yahoo has always been, what is the core part of our business that users love us for? As she probably knew, fantasy sports is a big one, but unfortunately that's not going to be enough for a company as large as Yahoo. As a result, they bought up a bunch of startups to try and find more core-utility.

It's been fun to watch, but I'm with the crowd that says Yahoo can't really change and should just sell its core off. When the average consumer thinks internet, they're not thinking "oh thank god Yahoo is there", but without Google or Amazon -- two companies that can justify aggressive growth -- we'd be left with a shoddier internet and that's just the basic truth of it all.

Touche• 10 years ago

Yahoo was sustainable and profitable. They weren't as big as Google or Amazon but they made a lot of money. But that wasn't good enough for the investors or the public, who want infinite growth.

WalterBright• 10 years ago

I never understood the mania for growth. If a company is reliably returning, say, 20% profit, I wouldn't mess with success.

jonknee4• 10 years ago

It's not too complicated: if you don't pay a reliable dividend you need to have growth to keep investors happy. Yahoo's profitable businesses have been shrinking and they have been unable to find new ones to replace them.

joslin012• 10 years ago

Sure, but looking at their historic revenue, you're going from ~1.8B between 2007 - 2009 down to ~1.1B 2011-present[1]. In fact, their latest quarter for Mar 2016 only netted them 1.08B.

This is a ton of money and I reckon they could last a long time on it, but I believe the investor-mindset is something like "if you're not growing, you're dying" and if you're dying, you should probably sell at your peak. Looking at Yahoo revenue, it's clear they're dying and as a result, I wouldn't paint this as just greedy investors being greedy.

[1] https://ycharts.com/companies/YHOO/revenues

usrusr2• 10 years ago

It's an inherent risk of being publicly traded. Imagine a company with perfectly stable profits, unlikely to change in any direction. If some part of the market develops a collective delusion about that company being a prime growth candidate, then that part will buy out the realists. When that has happened the new owners will reshape the company into the growth-or-die-trying experiment they where expecting to buy.

zelias• 10 years ago

She should've focused on growth adjacent to Yahoo's core strengths -- trying to acquire FanDuel in its earlier days, for instance. Maybe we could've seen Yahoo lead the daily fantasy sports industry.

deepfriedbits• 10 years ago

As I understand it, she/they did try to make a play here, acquiring Jerry Shen and Bignoggins for fantasy innovation, including daily stuff.

Unfortunately, he was quickly fired from Yahoo! for sending out an inter-department email quoting N.W.A. (the rap group) with language one wouldn't consider work appropriate – particularly at a company that size.

sjg007• 10 years ago

One issue is that fan duel is basically illegal in the us, despite the legislation that seems to legalize it.. Now maybe as an overseas fan duel could work.

OpenDrapery• 10 years ago

Growth for the sake of growth is the ideology of the cancer cell.

https://en.wikiquote.org/wiki/Edward_Abbey

gooserock• 10 years ago

Also ponzi schemes.

codezero• 10 years ago

If you're curious what an activist investor is:

"An activist investor is an individual or group that purchases large numbers of a public company's shares and/or tries to obtain seats on the company's board with the goal of effecting a major change in the company."

chetanahuja• 10 years ago

When Meyer left google, I was of the opinion that it's a good move for her. She had strong signals that her rise at Google was limited. This is when Larry Page had taken over as CEO and created a new "inner circle" of 7 senior VP's and Marissa was not one of them.

I thought it was a good move for her because she gets to be a big fish in a smaller pond and gets her name out there as a CEO. Pretty much nobody would blame her if Yahoo ended up bankrupt anyway since nobody had high hopes. But at this point it feels like her brand is damaged along with Yahoo's because of the leaks of boardroom struggles more than just the failure to revive Yahoo's business.

this_user• 10 years ago

If she had managed to turn the company around, she would have become a legendary tech CEO. Either way she has made a lot of money and stands to make even more no matter what happens. So, in the end, this was still a good move for her.

jonknee4• 10 years ago

Indeed, she has greatly enriched herself while flailing:

If Yahoo is sold and Ms. Mayer is terminated as a result, she stands to receive about $55 million. Since joining Yahoo, she has received $118.2 million in cash and equity compensation.

venomsnake• 10 years ago

And I think the whole Yahoo story vindicated Google's decision to limit her rise. Of course back then everyone was too busy shouting sexist (not completely without reason) at anyone that doubted her management chops or her ability to save Yahoo.

The flamewars of the future after Theranos and Yahoo will be endlessly entertaining.

maxerickson• 10 years ago

She got 100 million+ dollars.

She doesn't need a brand anymore.

mathattack3• 10 years ago

It may be damaged, but she leaves with a CEO title and a lot of money and connections. It would be easy for her to become a VC, Angel or other time of advisor. (Especially since she can pony up her own money, and does have legitimate advice to give.)

heimatau4• 10 years ago

I felt this way too but...this WSJ article is indirectly [1] confirming the success of Mayer's turnaround. Mobile is where the AD revenue is since there are very few iOS/Android AD blockers like uBlock Origin (and other desktop/laptop browser based blockers). Mavens IS MOBILE. This segment is growing crazy fast. If she were too grow 50-100% more, the turnaround would be official for Yahoo and at the current rate, it looks like 1-2 years more.

I think Starboard is doing a great PR campaign against Mayer. I had their narrative believed but...now I'm extremely doubtful about the nay-sayers. Since she's generating 1.5 billion through Mavens/mobile. Yahoo was non-exist in the mobile space. She's doing a great job. Activist shareholders are a plague in many (if not most) situations. It's why Dell took Dell private, to do a proper turnaround in the tech world.

[1] https://si.wsj.net/public/resources/images/P1-BX746_YAHOO__9...

revelation• 10 years ago

It seems to have already stopped growing.

With the explosion in smartphones and the web properties Yahoo had all along, it seems almost impossible to not make money off that. But no thanks to Yahoo, they didn't invent smartphones nor mobile ads after all.

(Also, of course, companies have large freedom what revenue they attribute where, shifting revenue from areas the market perceives as "stagnant" to those of "rapid growth" even if they have no actual presence. That's how IBM is the biggest cloud company in the world.)

vl2• 10 years ago

created a new "inner circle" of 7 senior VP's

Interesting, who was on the inner circle?

spriggan33• 10 years ago

It's well documented that she struggled with the current CEO of Google, he was part of that circle.

e15ctr0n2• 10 years ago

As per John Paczkowski's AllThingsD blog post dated April 8, 2011 [0], six of them were:

* Sundar Pichai, SVP of Chrome

* Vic Gundotra, SVP of social

* Andy Rubin, SVP of mobile

* Salar Kamangar, SVP of YouTube and video

* Alan Eustace, SVP of search

* Susan Wojcicki, SVP of ads.

Nicholas Carlson's article Sex and Politics at Google: It's a Game of Thrones in Mountain View [1] goes into details about the rivalry and jockeying within Google's top ranks.

[0] http://allthingsd.com/20110408/pageyank-as-a-new-svps-are-bo...

[1] http://www.slate.com/blogs/business_insider/2013/09/20/sex_a...

mark_l_watson• 10 years ago

I feel the same. I thought it was a good idea for her to take the job even if I had doubts about Yahoo's future. Assuming she wants to stay in the game, I think it likely she will have a long and successful technical management career.

0xmohit• 10 years ago

Hacker News appears to be turning into Mayer News.

Is Yahoo! acquiring YCombinator?

mathattack3• 10 years ago

I think you have the buyer and seller backwards. :-)

whack3• 10 years ago

I enjoyed the first couple of Yahoo/Meyer post-mortems, but at this point, it just seems like people are flogging a dead horse and taking potshots at Meyer while she's down.

She took on a hard job at a struggling company with minimal core competencies and a downward trajectory. Yes, she spent big and made a number of risky bets, which ultimately didn't pay off. Few people took a stand against her when she made those bets, but now that we know the outcome, everyone's suddenly an expert who knew better all along.

Yes, she wasn't able to save a sinking ship, and yes, we now know that she's no Steve Jobs. But that just makes her an average executive, in the same league as most SVPs/CEOs out there. It doesn't make her a failure or incompetent. Let's bury this dead horse already.

golergka• 10 years ago

I don't think that most CEOs/VPs would take such a job in the first place though.

jedberg• 10 years ago

I think they would. If you can turn Yahoo around, you become legendary. CEOs are already risk takers, it makes sense.

Also it wasn't all that risky. Even though she failed she'll walk away with enough money for a lifetime (to add on top of the lifetime supply she already had).

EpicEng• 10 years ago

I don't think that most CEOs/VPs would take such a job in the first place though

You don't? A job with a huge potential payoff while making oodles of money in the meantime? Yeah, sounds awful. You fail that job and, worst case, your family is set up for 3+ generations.

xenihn• 10 years ago

Few people took a stand against her when she made those bets

I'd like to know why you think that nobody wanted to call her out publicly. I'm not disagreeing with you, I just want to know your opinion in regards to why people kept quiet.

asimuvPR• 10 years ago

People kept quiet? I'm not a Mayer apologist (or even a "fan"), but she has been criticized for everything. From her looks (people said she is a dumb blonde who is going to wreck everything) to her decisions (everyone knew tumblr was a bad idea). I have even read about people saying that Google offloaded her to Yahoo in order to sink them. All of this right here on HN.

So no, they did not keep quiet. They've treated her worse than Jobs. Who by the way, conspired with others to pay tech workers less...

whack3• 10 years ago

I think people kept quiet because most of what she did seemed reasonable at the time. When you're suddenly put in charge of a sinking ship, you need to make big risky bets in order to turn things around. When you're managing a company worth tens of billions of dollars, obsessing over a few ten million dollars seems penny wise and pound foolish. She didn't make any obvious mistakes, which is why there was no consensus that she was doing a bad job. But now that everyone knows the outcome, people seem to have known better all along.

If I'm reading the subtext of your post correctly, you're insinuating that people didn't want to call her out publicly because they didn't want to seem sexist? If so, that certainly hasn't stopped people from taking potshots at her now.

spriggan33• 10 years ago

Few people took a stand against her when she made those bets

Plenty did, but it was not politically correct to attack her publicly, so these people's concerns were quickly dismissed as you know what (it begins with a s... ).

Yahoo has zillions of product. How about integration between these products ? there is none. That's how you start building a valuable ecosystem, that's what Google, Apple and Microsoft do ! You can't buy your way into success if there is no real global strategy to interconnect all the apps you bought.

wpietri4• 10 years ago

There's a big difference between critiquing a business strategy and "attacking her".

When people do the latter to a prominent woman, I think it's reasonable to ask whether sexism is involved. We know from a variety of studies that people are more critical of women, and more personally critical. [1]

It's often unintentional; many people who are consciously not sexist demonstrate significant bias. So I don't think anybody needs to feel accused or defensive. But it's certainly something we as a society need to work on.

[1] E.g.: http://fortune.com/2014/08/26/performance-review-gender-bias... and http://www.wsj.com/articles/gender-bias-at-work-turns-up-in-...

heimatau4• 10 years ago

Yes, she wasn't able to save a sinking ship

Why do you think this? Based on the WSJ article [1] she created a mobile ad revenue (non-existent before Mayer) of 1.5 billion. Mavens is a huge success. She does need a little more time. I honestly thought Mavens was a wash until this article but she's followed through on what she said and it's working. A 4 billion dollar company that created a 1.5 billion market...I'd call that pretty awesome. She needs to do better though. Double that and the public should see the turnaround as well, which she's on track to do with 1-2 more years of aggressiveness.

[1] https://si.wsj.net/public/resources/images/P1-BX746_YAHOO__9...

jonknee4• 10 years ago

Mavens isn't a new product, it's advertising sales in the only growing parts of the company (mobile/video). Meanwhile other revenues are collapsing and total revenue is sagging. Profits are in the shitter and they're trying to sell off all the pieces before it's too late. It's absolutely a sinking ship.

So yes, she cherry picked the hot areas and highlights how they are growing and ignores the fact that costs are also growing and profits are disappearing. Yay MaVeNS!

gadders• 10 years ago

with minimal core competencies

Sorry - do you mean Mayer or Yahoo?

whack3• 10 years ago

Yahoo.

Mayer is a very competent woman, as anyone at Google would tell you.

dave2000• 10 years ago

I think people knew the logo redesign was a joke immediately. It was obvious she was the wrong person to run such a large company and no-one liked the company to begin with. It's hard to blame people for having the advantage of hindsight when they were criticizing her at the time. Being an average executive at that level just doesn't cut it.

cxseven• 10 years ago

It's strange that Yahoo once had a very popular suite of multiplayer online Java games (mostly board games) and failed to use them to gain an early advantage on mobile apps.

Yahoo’s Marissa Mayer Stumbled After Secret Truce with Activist Investor

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