Yahoo hired a fix-it CEO. The value wasn't in the business to fix.
In 2014 Yahoo was worth nearly $39 billion while its Alibaba stake alone was worth about $37 billion. Verizon later paid about $4.48 billion for the company. Check where the value is before you hire to fix it.
Transcript
In July 2012, Yahoo's board hired the closest thing the industry had to a fix-it genius. The more telling story is the option it passed over.
Option one: hire a product visionary to transform the core business. Option two: admit Yahoo was mostly a holding company, and unwind it as one. On July 17, 2012, Marissa Mayer became chief executive.
Here is why the second option mattered. After Alibaba's IPO in September 2014, Yahoo's market value was nearly $39 billion. Its Alibaba stake alone was worth about $37 billion, and its Yahoo Japan stake about $8.2 billion. The core business was worth almost nothing.
In June 2017, Verizon bought Yahoo for about $4.48 billion, marked down by $350 million after Yahoo disclosed two enormous data breaches. Mayer left with more than $23 million.
The board kept hiring transformational operators into a role the balance sheet had made untransformable. Before you hire someone to fix a business, check whether the value is in the business at all.
The records behind this video
Every figure in the video comes from this Decision Record, each with its sources.
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