Marissa Mayer and the Fight to Save Yahoo! Book Summary - Marissa Mayer and the Fight to Save Yahoo! Book explained in key points

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Marissa Mayer and the Fight to Save Yahoo! summary

Name: Marissa Mayer and the Fight to Save Yahoo!
Author: Nicholas Carlson

Nicholas Carlson

The thrilling story of how Marissa Mayer became the CEO of Yahoo in her 30s

26 mins

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Success Leadership

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Marissa Mayer and the Fight to Save Yahoo!
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What’s in it for me? Catch a glimpse behind the scenes at Yahoo.

There was a time before Google ruled the internet. Back then, Yahoo was the Internet. But those days are gone: if Yahoo vanished off the face of the earth right now, it would hardly change your internet experience. For almost all of Yahoo’s services, there’s a better alternative out there.

In 2012, someone set out to rescue Yahoo – an ambitious character, used to achieving her goals. At just 37, Marissa Mayer was already looking back at an impressive career at Google Inc., leaving the company while at the post of vice president.

While she’s rumoured to be shy, Mayer’s controversial quotes and daring decisions – like buying the microblogging platform Tumblr for the record sum of $1.1 billion – frequently make headlines. Taking the helm as Yahoo’s CEO, Mayer made some terrible choices about the company’s media business, but simultaneously gave Yahoo some much-needed direction, streamlining the product palette and betting heavily on mobile apps.

But did it work? The jury is still out.

In these blinks, you’ll learn

about Yahoo’s very modest beginnings at Stanford University;
about the company’s most foolish decision (so far); and
about the meteoric rise of Marissa Mayer.

The early Yahoo was promising, and had no trouble finding financial support.

Like many other success stories, Yahoo came from modest beginnings. In 1993, Yahoo’s prospective founders David Filo and Jerry Yang shared the links to their favorite web pages on a website called David and Jerry’s Guide to the Internet.

Back then, the world wide web was relatively new and their site was little more than an index of web pages, allowing people who were new to the internet to look up pages they were interested in. Unexpectedly, traffic grew to 50,000 visits per day. It seemed that David and Jerry’s site had tapped into something unique.

The founders renamed the site to the more memorable Yahoo!, an acronym for “Yet another hierarchical officious Oracle”. They also liked the slang definition of the word “yahoo,” referring to a rude, unsophisticated person. And so Yahoo was born.

Traffic kept growing steadily, reaching one million clicks per day in 1995. At this rate, the infrastructure provided by Stanford University wasn’t enough to support the site. David and Jerry needed real servers for Yahoo – and for these, they would also need some cash.

Fortunately for them, finding investors was a piece of cake. Sequoia Capital partner Mike Moritz decided that the newbie company needed “adult supervision” to scale up the business. This gave the founders the freedom to focus on the innovation side. Sequoia would become COO, while Stanford graduate Tim Koogle would take on the role of CEO and chairman.

In March 1995, only days after Yahoo was incorporated, they declined an offer of $2 million from America Online to buy Yahoo outright, and instead sold 25 percent of the company to Sequoia Capital for $1 million. With adult supervision in place, it was time for Yahoo to create a serious business plan.

Yahoo became an online advertiser and a billion dollar company within four years.

Yahoo had its investor and infrastructure – now it just needed to make some money. So, the company’s leaders decided to turn to advertising to generate revenue. Back in 1995, online advertising was still finding its feet. The estimated volume of the entire online advertising market that year was only $20 million.

Yahoo made its first deal with renowned international news agency Reuters, offering to publish their stories on Yahoo.com. Yahoo then signed a deal with Visa and General Motors to post ads, charging as little as $20,000 per month. Business picked up speed soon after.

Innovative projects and data insights allowed Yahoo to rapidly create hundreds of new products.

Yahoo’s COO Jeff Mallett came from the world of computer software, where you essentially build products and hope users like them. But he realized that Yahoo had the potential for a much more auspicious approach.

Yahoo began to use traffic data to match products to customers’ needs. Mallett realized that with the data about customers’ preferences gleaned from web searches, he could simply analyze their clicks and search behavior on Yahoo to build exactly the products that these customers wanted. He wouldn’t have to guess what people needed, because he would already know.

Yahoo’s first big mistake was selling its name.

By late-2000, things at Yahoo began to fall apart. The dot-com crash had hit Yahoo hard, and in that year, the company’s value had shrunk by 90 percent from $128 billion to $12.6 billion. Where did it all go wrong? Put simply, Yahoo sold out.

Since Yahoo was such a popular and big company, every time a new start-up officially announced its collaboration with Yahoo, the start-up’s market value would skyrocket. Some Yahoo executives used this tendency to make deals with start-ups.

Yahoo built a traditional advertising business and recovered.

Yahoo had destroyed the integrity and profitability of their online advertising business, and it was time for its first CEO Ted Koogle to resign. His spot was filled by Terry Semel, former CEO of Warner Brothers.

The new CEO reorganized Yahoo’s ad business to make it a traditional ad sales business. Semel’s strategy was simple: although much of Yahoo’s market value was destroyed with the implosion of the dot-com bubble, more and more web users were visiting the site each day.

Not buying Google when it had the chance could be the biggest mistake Yahoo ever made.

Yahoo wasn’t doing too badly after its change of CEO. But in 1997, the company missed an opportunity that would have secured its dominant role in the internet for decades to come.

Larry Page offered Yahoo his thesis project BackRub, which would later become Google, for a meagre $1 million. He wanted the money to finance his PhD and become a professor. But Yahoo passed up on the offer! Why?

Competition with specialized start-ups and lack of organization took their toll on Yahoo.

The growing influence of competitors like Google started to chip away at Yahoo’s traffic. Competing with too many specialized start-ups wasn’t helpful for Yahoo’s public and internal image; the company had spread itself too thin.

Yahoo tried to compete with CNN in news, with ESPN in sports, with MySpace in social networking and of course with Google in online searches. When Semel joined Yahoo, it had 400 different products and services.

Marissa Mayer quickly gained traction and experience in the tech world.

Marissa Ann Mayer was born in 1975 in Wisconsin, where a middle-class upbringing allowed her to shine at various hobbies. The ambitious and talented Marissa played volleyball and basketball, took piano lessons and at one point even took ballet for as many as 35 hours a week during middle school.

Quiet, intelligent and with little in the way of social skills, she fit the mold of a nerd perfectly. But for all her nerdiness, it soon became clear that Marissa was quite good at giving directions. Whether in sports or class projects, she always took over a leadership role and was supported by her peers, who felt she was fair and exceptionally good at managing progress.

Mayer gave Yahoo a new direction: mobile internet.

As we found out earlier, Yahoo could do everything, but nothing especially well. It was this aspect of the company that Mayer was determined to change.

When Mayer became Yahoo’s CEO, the company faced an important decision: what was it going to become? Would it be a media company that focused on large-scale online publishing, or the production of content such as videos and news? Or would Yahoo be better off as a tech company, centered on developing innovative new products?

Behind the illusion of success lay a poorly managed media department and ever-dwindling revenue.

On December 2012, Yahoo’s stock was up 24 percent since Mayer became CEO. Only a few months earlier, she had outbid Facebook to buy Tumblr for $1.1 billion and morale was at an all-time high. More and more highly qualified candidates began sending their résumés to Yahoo.

It looked like Yahoo was finally out of the woods. But it was actually far from it! Despite all its efforts, Yahoo’s search market share was still shrinking, as was its traffic and, ultimately, its revenues from selling ads. As it turned out, Yahoo’s rising stock value was mostly a result of the fact that it owned parts of Alibaba, an exploding Asian start-up.

Mayer’s efforts weren’t enough to save Yahoo, and the fight continues.

Mayer and her development teams increased their efforts even more and began to push themselves to the limit. Mayer’s efforts to increase the speed of processes caused problems within Yahoo and among its users.

The new Yahoo Mail was suffering multiple breakdowns, and users couldn’t access their mail. The reason was that the development team was pushed so hard to produce results quickly, they couldn’t properly test the underlying technology before launching.

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What is Marissa Mayer and the Fight to Save Yahoo! about?

Marissa Mayer and the Fight to Save Yahoo! (2015) takes us on a journey through the ups and downs of this one-time leader of the early internet. These blinks explain how Yahoo has changed, and often struggled, as it progressed from its early start-up days to a multi-billion dollar corporation. The blinks also put a spotlight on Yahoo’s latest CEO, Marissa Mayer, and her extensive efforts to keep the company moving forward.

Best quote from Marissa Mayer and the Fight to Save Yahoo!

Yahoo tried to be everything for everyone and failed to be exceptionally good at something.

—Nicholas Carlson

Who should read Marissa Mayer and the Fight to Save Yahoo!?

Readers who want a peek behind the scenes of Yahoo
Ambitious tech geeks curious about the dynamics of tech start-ups
Avid readers of corporate biographies (the adventure tales of today)

About the Author

Nicholas Carlson is Business Insider's chief correspondent and investigative reporter. He wrote about the histories of Facebook, Twitter and Groupon and is the author of The Cost of Winning: Tim Armstrong, Patch and the Struggle To Save AOL.

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