Marissa Mayer's Startup Shopping Spree Is Over Before It Began (YHOO, GOOG, AAPL, YELP)

That's the sound of a wallet slamming shut. Marissa Mayer has announced that Yahoo will be returning most of the cash from the sale of its stake in Alibaba, the Chinese e-commerce company, to shareholders. That means it won't be going into the hands of venture capitalists and entrepreneurs who might be eager to sell companies to Yahoo, as many hoped when Yahoo said it was considering keeping the cash. Over the past decade or so, Yahoo was a great buyer of companies, acquiring Inktomi and Overture to push its way into Web search and buying a passel of adorably named startups—Flickr, Delicious, Upcoming, and so on—during the Web 2.0 era. In more recent years, it's bought a lot of ad-technology companies. But as of the second quarter, Yahoo only had $2.4 billion in cash and cash equivalents. That's a pittance compared to Google, Apple, and Microsoft. Even eBay has more cash (and it's been actively buying startups). Yahoo's stock still hasn't moved out of the teens, meaning it's not a great currency for acquisitions. The $650 million that Yahoo will keep from the Alibaba deal doesn't move Yahoo into the big leagues, cashwise. Yahoo still has its stake in Yahoo Japan. But a source familiar with the ongoing negotiations to unwind Yahoo's investment in the Japanese Internet portal tells us there's still no real progress. So that payday is a ways off, and Mayer can't count on it coming in to fund any deals in the short term. One reasonable explanation: Mayer and her board may have looked at the field of potential acquisitions—Foursquare and Yelp often come up—and decided they were still too expensive and wouldn't move the needle on Yahoo's core business. That's not saying Yahoo couldn't do some deals. But they will likely be small and focused on talent, perhaps bolstering Mayer's bold bet on Yahoo's in-house ad technology. In the meantime, Mayer is spending the resources she has on making Yahoo a better place to work—busting bureaucracy, buying smartphones, and banishing cafeteria bills. If she can create an environment that can attract talented coders and designers who will invent brand-new products, she may not have to buy that many startups. Please follow SAI on Twitter and Facebook.Join the conversation about this story »

Marissa Mayer Is Trying To Stop Yahoo Employees From Checking The Company's Stock So They Focus More On Products (YHOO)

It has been less than a month since Marissa Mayer took over as CEO of Yahoo, but she has already made it clear to employees that they should be focusing more on products and users. The Wall Street Journal reports that Mayer so serious about getting employees to focus more on products rather than profit that she has actually taken steps to prevent Yahoo's staff from checking the company's stock price. From the Journal article: Mayer recently ordered Yahoo's stock ticker removed from the home page of the company's internal website, called Backyard, signaling to employees that they should focus on creating better Web services rather than worry about corporate finances. "I want you thinking about users," Ms. Mayer has repeatedly said to Yahoo workers, according to people who have interacted with her. This a huge change from her predecessors, Ross Levisohn and Scott Thompson, both of whom were very much focused on boosting the company's advertising revenue. In part, this move speaks to Mayer's background at Google where the product is everything. But as the Journal points out, Mayer may also have more freedom to focus on product rather than ads as Yahoo's board has reportedly "promised her she will have years to repair the company's core advertising business." Please follow SAI on Twitter and Facebook.Join the conversation about this story »

Why Yahoo Picked Marissa Mayer, According To A Source Close To The Board (YHOO, GOOG)

We just talked to a source close to the Yahoo board. Here's why the board picked Google VP Marissa Mayer to be the company's new CEO:

She is "product-focused" and "focused on the user-experience." She is "capable of taking the company back to its product and consumer-driven roots." This is a departure from interim Yahoo CEO Ross Levinsohn's plan to focus the company on the media business—a sort of cable company 2.0.

She is good at mentoring talent. She created a program at Google to train product managers on executive leadership. Many of them are now managers at places like Uber, Dropbox, and Polyvore.

The board believes she will be able to recruit very well and re-stock Yahoo with talent.

She's a big name—"a big surprise to people."

Cofounder David Filo, who still works at the company and is its largest shareholder, gave her his stamp of approval.

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Yahoo Employee Makes A HOPE Poster With Marissa Mayer's Face Instead Of Obama's (YHOO)

There are posters hanging on the walls of Yahoo's Sunnyvale headquarters. They depict the company's new CEO, Marissa Mayer, in the style of Shepard Fairey's iconic "Hope" poster. It's done in shades of purple—which is Yahoo's signature color, and also happens to be Marissa's personal favorite hue. That speaks to what we're hearing about how Mayer's being received by Yahoo's troops—particularly engineers and product managers who have long felt sidelined by a focus on the company's media and sales divisions. YouTube director of product management Hunter Walk somehow spotted the poster from Snowmass Village, Colo., which seems like quite the trick. (Or someone at Yahoo just emailed it to him, but that's such a boring explanation.) Please follow SAI on Twitter and Facebook.Join the conversation about this story »

Marissa Mayer Will Go To Lunch With You For $5,250 (But You Better Act Fast) (YHOO)

Want to have an hour lunch with Yahoo CEO Marissa Mayer? It'll cost you $5,250. Mayer is auctioning off an hour of her time for charity through a website called Charitybuzz. The current bid is $5,000, and you have to bid a least $5,250 to top it. Apple CEO Tim Cook auctioned off his lunch hour a couple weeks ago and raised $610,000. Here's the "lot description" for Mayer: Find out what it's like to lead one of the world's most well-known tech companies, as you join Yahoo! CEO Marissa Mayer over lunch at the company's Sunnyvale, CA headquarters. Marissa Mayer joined Yahoo! as President and CEO in July 2012. Since then, she has focused Yahoo! on creating inspiring and delightful products and making Yahoo! the absolute best place to work. Under her leadership, the company has re-imagined a number of daily habits, including Yahoo! Mail, the homepage, Flickr, and Yahoo! Weather. Prior to Yahoo!, Marissa was at Google for 13 years and held numerous positions including engineer, designer, product manager, and executive. She played an instrumental role in Google Search, leading the product management effort for more than a decade. Marissa also led the development of some of Google's most successful services including Google Maps, Street View, Google Local and Zagat, Google Toolbar and iGoogle, and she helped define such pivotal products as Google News, Gmail and Chrome. She holds a dozen patents across the areas of artificial intelligence and interface design. Marissa serves on the board of directors of Walmart. She is also on the board of various non-profits, including the San Francisco Museum of Modern Art, the San Francisco Ballet, and the New York City Ballet. Please follow SAI on Twitter and Facebook.Join the conversation about this story »    

Here Is The Plan Marissa Mayer JUST Announced To Yahoo Employees (YHOO)

After two months on the job, new Yahoo CEO Marissa Mayer today held an all-hands meeting with employees to announce her turnaround plan for the company. We are starting to get details on what, exactly, she said. Here is what we have heard so far: Mayer defined Yahoo. Paraphrasing, she told employees. "Yahoo is a company that excels at personalization across content and ads." She emphasized user growth, ad sales, improving ad tools, and attracing better talent. Mayer said that Yahoo will do more "acqui-hires," where it buys small companies not for their products, but for their engineering talent. Mayer outlined Yahoo's guiding strategy: The goal is to become something users touch every day. Yahoo will focus more. To paraphrase: "Do more of what we're good at and less of what we're not." Yahoo will be partner friendly.  Yahoo will be strong in mobile by 2015. Projects will only be greenlit if they can scale to 100 million users or $100 million in revenue. Yahoo will move faster, giving employees more deadlines, ownership, resources, and tools. Mayer said Yahoo will nurture talent through "the Four Cs." They are: Culture Company goals Calibration Compensation. Attention Yahoos: We'd like more color. Email nicholas@businessinsider.com. Text 727 507 1699. Call 646 376 6014. Please follow SAI on Twitter and Facebook.Join the conversation about this story »

Here's How Facebook's Sheryl Sandberg Congratulated Marissa Mayer

That awkward moment where a really great thing happens to someone you know, but it's kind of bad for you, but admitting that would be tacky, so what do you say? Yeah, that just happened to Facebook COO Sheryl Sandberg. Twitter's chairman and CEO, along with other tech luminaries, swiftly praised Yahoo's decision to name longtime Google executive Marissa Mayer its new CEO. Shortly after the announcement of Mayer as Yahoo's CEO, Business Insider asked Facebook if Sandberg, who led the recent deal with Yahoo, was planning to make a statement. After all, Sandberg and Mayer had worked together for years and Sandberg has championed the cause of women executives in the Valley. Finding just the right thing to say took a while. At the end of the day, Sandberg posted a congratulatory note on her Facebook wall: Congratulations to Marissa Mayer! Great news for women (and men!) across Silicon Valley. All of us at Facebook look forward to working with you in your new role. We also want to thank Ross Levinsohn for his leadership in reestablishing an important relationship for Facebook and promoting innovation in the broader tech community. Here's why we think it took Sandberg a little longer to come up with a safe way to congratulate Mayer:

Mayer is naturally going to be more open to partnerships with Google than past Yahoo leadership. She knows the company's leadership, products, and technology inside out. That's not great for Facebook, which wants to keep Google isolated.

By hiring a product-oriented CEO, Yahoo's board has signaled that it's going to be a technology company first, not a media company. That's not great for Facebook, which will now face more competition for talent and acquisitions.

With the patent settlement and related partnership announcement, Sandberg very firmly threw in her hat with interim CEO Ross Levinsohn. Now he's not only not the permanent CEO, but his future status with the company is up in the air. That's not great for Sandberg, professionally speaking.

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The Truth About Marissa Mayer's Surprise Deal With Google (GOOG, YHOO, MSFT)

A couple weeks ago, Marissa Mayer surprised a lot of people in the industry when the company she runs now, Yahoo, announced plans to outsource some of its ad sales to the company that made her famous and she quit in July, Google. In a note on its corporate blog, Yahoo said it had signed "a global, non-exclusive agreement with Google to display ads on various Yahoo! properties and certain co-branded sites using Google’s AdSense for Content and Google’s AdMob services." The news was surprising for a couple reasons. When Mayer quit Google in July for the job at Yahoo, she didn't do it in the friendliest way. A source tells us she gave Google only 30 minutes notice. Then, a couple months later, she poached another Google executive, Henrique De Castro, and made him her number two. Shortly after Mayer arrived at Yahoo, she squashed a similar deal that her predecessor, interim Yahoo CEO Ross Levinsohn, had in the works. So, what gives? Why did Mayer do the deal now? What does it mean? We asked several people in the industry – all of whom happen to be ex-Yahoos, some of whom work at companies that do business with Yahoo. Here's what they had to say. Ex-Yahoo #1: "Marissa certainly wants to move the search deal from Microsoft to Google... Maybe this is the first of a few chess moves." Ex-Yahoo #2: That deal has been in the works forever. [Former interim CEO] Ross [Levinsohn] and [former Yahoo corporate development executive Jim] Heckman were pushing for that big time. The deal addresses two key issues:  Bid density. The hope is that this deal creates a really stable price floor raising rates across the board. Because [Yahoo's display advertising exchange, Right Media] has been under-invested in on many levels, the amount of demand is significantly less than the amount of supply, so economical principals dictate that as such, prices will fall. This deal may impact pricing and yield management that impacts all campaigns all the way through the sales org by creating a new equilibrium point.  If you look at Yahoos financials, their display ad business which is the main one they control (not search) is continuing to decline. Sales leadership is weak and good sales execs continue to leave. This deal signals the fact that they do NOT have a good handle on how to run their own business.   Make no mistake, it's a bandaid. It doesn't address their fundamental issues it just masks the symptoms for awhile. Another: "Why doesn't Ross Levinsohn just send you the strategic plan that he presented to the board and you'll know what they do next" Insiders seem to be split on what the deal really means.  But one thing is clear: Yahoo's deal with Microsoft is likely forcing it to accept lower revenue per search than a comparable deal with Google would. So Mayer would be crazy if she weren't trying to either shift to Google or use Google as leverage to extract a better deal from Microsoft. Please follow SAI on Twitter and Facebook.Join the conversation about this story »

EXCLUSIVE Q&A: Marc Andreessen Tells Us What He Thinks Of New Yahoo CEO Marissa Mayer (YHOO, GOOG)

In a dramatic and surprising move, Yahoo just hired famous Google VP Marissa Mayer to be its CEO. So what does the Silicon Valley cognoscenti think? To find out, we asked Marc Andreessen. Marc Andreessen is the Netscape cofounder who is now a Valley kingmaker at top VC firm Andreessen Horowitz, so his view of the hire speaks volumes about what everyone else thinks out there. Here's what he had to say: Business Insider: What do you think? It's a huge statement on the part of the board that they want the company to be product-led. I say that because they had a great CEO if they wanted to be media-led. It's a huge double down on product. Do you think focusing on tech products is the right strategy for Yahoo? If you asked me a week ago, I would have said probably not, but I didn't think they could get someone like Marissa.  Why are you surprised they got her? She was not known to be available and when companies get into these dire straights, it's hard to get someone of this caliber. Even Steve Jobs didn't want to go Apple. So you think Mayer is a great hire. Why?  Three reasons:

She's a proven manager at scale. She knows how to run these companies at scale. There aren't that many product managers in our industry who can manage at scale. She's a proven product leader. She knows the Internet inside out. 

A lot of people who may have had those first two may not have the third. One problem Yahoo has had recently is that it has needed to acquire hot startups to replace its decaying businesses, but entrepreneurs have refused to go there. Groupon's Andrew Mason and Foursquare's Dennis Crowley come to mind. Will entrepreneurs sell to Yahoo now? They will be much more likely to because of her background and qualifications. Entrepreneurs don't usually want to work for someone, but she's exactly the kind of person they do want to work for.  Teens don't email and adults check it on their phones: What will Yahoo's engagement engine be next? How will it attract visitors?  Almost every category that Yahoo's in, they're basically number one or two. They've got a pretty strong starting position. But they just went stale for a whole host of reasons. In almost every category they're in they've got an opportunity to re-think the space: Sports, Finance, and mail.  What would be the killer finance, sports, or mail app in the modern era? What'd you think of interim CEO Ross Levinsohn? Lots of others thought he should have gotten the job. I don't think they passed on Ross, I think they decided on the product profile. I think it was a strategy decision not a person decision. If they wanted a content strategy they had a great guy in the job. He would have been great. He's in the catbird seat right now. They're either going to pay him a lot of money to stay there or he's immediately the number one candidate for any other job. Are big name executive departures like this one a problem for Google?  You now have a pattern of Google people going on to be CEO elsewhere. Tim [Armstrong, AOL CEO], Marissa, Sheryl Sandberg [Facebook COO]. It reminds me of GE. There is a great track record of people going elsewhere. That's a special thing for a company. It's a sign of a deep bench.  Can she do it? Can Marissa Mayer turn Yahoo around? Apple demonstrates that it's possible to turn a tech company around. Apple also proves how hard it is because it is one of a very small number of examples. The thing about turnarounds is that they take time. It's three to five years to do the job. So one of the things she needs for the board to support her for that period of time. The number 2 thing is for shareholders to support her.  Number three is people like us on the outside. This is not six months and what has she done for me. Please follow SAI on Twitter and Facebook.Join the conversation about this story »

Three Questions Marissa Mayer Asks Startups (YHOO)

We got our first glimpse of Yahoo CEO Marissa Mayer today! At the TechCrunch Disrupt conference in San Francisco, Mayer served as a judge for the startup competition. She's played a similar role at previous conferences, and she's evaluated companies for her own personal portfolio. She's an angel investor in Square, One Kings Lane, and other startups. That ability to spot new innovations was a key reason Yahoo's board hired Mayer away from Google to reinvent the company. So what does Mayer look for in startups? We listened to the questions she asked contestants for a guide. Can you deliver? When Lit Motors showed off its electric car-motorcycle crossover vehicle, Mayer wanted to know: "How similar will the end product be to the one you're showing today?" In other words, don't show her a fancy prototype of your product if you can't actually bring it to market. Can you connect? Gyft demonstrated a mobile gift-card app. Mayer wanted to know if it would work with Apple's new Passbook software, and why it required a time-consuming integration to bring partners onto the platform. Can you grow? YourMechanic brings car mechanics to your home or office to fix common car problems on the spot. Mayer's question: How are you going to scale? She asked a similar question of database startup Prior Knowledge, wondering how large their databases had to be to deliver accurate predictions. It's a safe bet Mayer's asking similar questions of teams at Yahoo. Please follow SAI on Twitter and Facebook.Join the conversation about this story »