> In 1998, Yahoo turned down the opportunity to acquire Google for $1 million. Yahoo made six acquisitions that year, spending $107.3 million.
> In 2002, Google offered to sell again for $1 billion. Yahoo hesitated and Google raised its price to $3 billion. Yahoo declined at the higher price. Google went on to become a trillion dollar company.
> Yahoo attempted to acquire Facebook for $1 billion in 2006, but Mark Zuckerberg turned down the offer. Had Yahoo increased its offer by just $100 million, Facebook’s board would have forced Zuckerberg to take it. Facebook also became a trillion dollar company.
In inclined to believe that neither would have become trillion dollar companies if they had been acquired by Yahoo.
In inclined to believe that neither would have become trillion dollar companies if they had been acquired by Yahoo.
I absolutely agree.
One fundamental reason why Yahoo failed is that they prioritized short-term revenue from search partners, over long-term reputation. One of the key people behind that was Prabhakar Raghavan.
And now, Prabhakar Raghavan is at Google. Where he has proceeded to make the same mistake, with the result that Google Search quality fell off of a cliff.
If Google had been acquired by Yahoo, he would have been in a position to destroy Google earlier than he actually did.
An increase in searches isn't necessarily a positive thing. Anecdotally, I've increased the number of Google searches I do simply because it now requires multiple attempts to frame my query in a way that provides the results I'm actually looking for!
Seems logical to me, but then my 71 year old mother with doctorates in both science and literature pulls out her phone and trusts Google AI results without thinking twice.
how much did internet usage increase that year, in terms of the number of people and hours spent? what changes happened in the app ecosystem that had google as a default search provider? what other service offerings shut down or degraded that caused people to move to google? how much did chrome browser usage increase over IE and Safari?
there are so many factors to this, its the same issue when target stock drops 10% over a year and people are like "oh it's because they stopped selling plus size bikinis! the crowd has spoken!". you can attribute it to anything but you're basically always wrong if you're not attributing it to at least a dozen different things
What do you do when you have a product whose value will inevitably drop in the medium/long-term? Squeeze every penny out of it while you still can. There is no solution to the SEO arms race, like there was no way Yahoo's blandly curated portal could stay relevant in the era of social media. He's the right man for the job. Google search has been doomed for a long time. It is another Yahoo.
LLMs have, for me at least, mostly replaced search. Because one of the most common things I search for is stuff like 'what is the function in [x] that does [y] in [z]'. Search for that on Google (or any other search engine) and your results will be complete trash. Search for it on an LLM and it's one of the few things they're nearly perfect at.
Search engines, especially with the resources of Google, could have developed at least basically functional natural language search decades ago. Instead they chose to rest on their laurels (pagerank even still plays a significant role!), and secure market control by anti-competitive behavior.
Google is certainly well on their way to becoming another Yahoo, but there's no extrinsic reason for it in the same way there was no reason for Yahoo to become what it became. In 100 years people will be searching the corpus of human writings (or whatever medium is dominant then) for information that's relevant to them. So there's in intrinsic reason for any search related company to just naturally die. It simply needs to keep innovating, or at least evolutionarily improving.
> Because one of the most common things I search for is stuff like 'what is the function in [x] that does [y] in [z]'.
This is also the type of search that Google makes no money from.
The money is in searching for up-to-date relevant product information, where Google is the undisputed leader.
>Search engines, especially with the resources of Google, could have developed at least basically functional natural language search decades ago
Google is one of the major AI research outfits, and arguably the only one that continues to deliver consistently over the last 2 decades. Statistical Machine Translation/Google Translate, Adwords Quality Score, TensorFlow, AlphaGo, Attention is all you need (Transformers), AlphaFold all Google innovations.
You can't really blame the prevalence of SEO slop on Google. It's not the lack of want of trying, it is hard technically (see how long it took to develop modern AI capabilities), expensive computationally (as we can see with the unsustainable cost of test-time search in ChatGPT) and in terms of user-experience.
>Google is certainly well on their way to becoming another Yahoo
Really, it isn't. Google is in the unique position of being the closest technology company to achieving full vertical integration of their value chain, from silicon to software to data to end-users. They are also at the forefront of frontier AI, including productising the research output. I don't really get the Google hate on HN, apart from maybe the YC/sama bias.
Your answer sounds very artificial. For instance "AI" is in no way whatsoever required for natural language search queries. There was some spreadsheet program back in the mid 90s that even supported natural language operation description - and is something that should also be obviously supported now a days. Even the adventure games of the same era often had natural language interfaces. It was quite useable even if obviously severely limited by minimal R&D put into it.
It was an obvious way to create a better user experience but instead search today is comparable to, if not worse than, search 20 years ago - because at least 20 years ago companies were ahead of the SEO guys, whereas that relationship has long since flipped.
What makes you think that Google hasn't developed natural language processing, when they launched Google Translate in 2006?
Also, what makes you think that NLP would solve the problem you're describing? Only LLMs has proven that it could fully understand and process the queries in the way you're describing, hence why I brought that up. However it is expensive computationally, and only recently was it even technically possible to do.
Most searches, even in natural language, are extremely simple. Google could certainly have added this functionality, but they chose not to. This is how old giants always die. They become so obsessed with further squeezing their users that they begin to stagnate, decline, and eventually completely miss the writing on the wall - and face disruption.
I will tell you all you need to know about Google - I was doing some research for a product I am building, my daughter (age 12) was an inspiration for what I am building and I asked her if she had time to help me with something and she did. Told her to “google ____” and she started laughing HARD and called me a boomer for suggesting she use Google… :)
These aren't incompatible issues. Google has a monopoly maintained by excessive and illegal anti-competitive practices. The majority of users have no clue how to even change their default search engine, which Google actively exploits. Just checking it out - it took no less than 6 clicks into various specific menu and sub-menu settings to do so.
Poll only the subset of people that are actively aware of how to change their search engine and I suspect Google's dominance suddenly completely disappears. Remember, there was a time when Internet Explorer was the leading web browser across all age groups. Then Microsoft was forced to make it easier for people to change their default browser, and suddenly nobody was using IE anymore.
My apologies, I did not mean to imply that my kid's humour is evidence of Google's demise. But it does make you wonder a bit... we use Google out habit (they used to be decent) and also because they pay boatload of money to be default search on iphone and myriad of other reasons but younger generations do not have that intimate relationship with google and can see "with fresh eyes" its usefulness compared to the alternatives ...
> The money is in searching for up-to-date relevant product information, where Google is the undisputed leader.
Actually for products, a lot of people just go to Amazon has a thriving ad business.
> Google is one of the major AI research outfits, and arguably the only one that continues to deliver consistently over the last 2 decades. Statistical Machine Translation/Google Translate, Adwords Quality Score, TensorFlow, AlphaGo, Attention is all you need (Transformers), AlphaFold all Google innovations.
The problem with Google is that they can’t produce good profitable products. Innovation means nothing for a for profit company if it doesn’t make money.
Easy. Google is basically spyware. It's an advertising company, and their product is you.
>searching for up-to-date relevant product information
I realise I'm not a typical user, but I would never trust Google for any searches hinting that I'm looking to buy something, because the results are almost guaranteed to be inorganic. Someone will have paid Google money to be promoted for "best clothes dryer".
>Easy. Google is basically spyware. It's an advertising company, and their product is you.
This is such a flippant and facile response.
Google isn't a advertising company, it is a tech company that gets the majority of its revenue via selling advertising. This can change, and also likely to change in the next decade or so.
The reason things are is that nobody was willing to pay for search - it's a product with a very low incremental cost. The market dictated this operating model, and nobody has been able to upend this model so far, not even OAI. The numbers just don't work out. Do you think OAI can continue to subsidise free ChatGPT queries with paid ChatGPT Plus subscriptions? Almost certainly not.
I think actually people probably are willing to pay for search - Google just did such a damn good job for so long it made it impossible for a competitor to pop up
And now that their core product is getting worse I am paying for search
How else should someone take the statement 'that is the type of search that Google makes no money from' when someone explained what type of searches they do? If Google doesn't make money from it, they don't develop it for search apparently, which is why they haven't progressed in search beyond advertising. You can argue that it needs disrupting, but concluding that 'they make their money from advertising' when that was directly stated by you is not flippant or facile, it is deduction.
You can't eat your cake and still have it. If they refuse to develop an income stream that isn't related to advertising while using practices that use their dominant place in the market to buy other technologies or shut them down, then saying it isn't their fault that the revenue is only advertising is either disingenuous or naive.
Yea this is just pure bs.
If you had taken to search for the name, you'd have found the wiki explaining the name's origin. https://en.m.wikipedia.org/wiki/Raghavan
Also,Raghavan is most probably his father's name and Prabhakar will be his given name.
Are you just pulling this out of your ass? Per Wikipedia, Prabhakar R was not at Yahoo in 1998 and 2002.
> After working 14 years at IBM, he became senior vice president and chief technology officer at enterprise search vendor Verity in 2004.[16][14][12] In July 2005, he was hired by Yahoo! to lead Yahoo! Research in Sunnyvale, California.[17] At Yahoo!, he worked on research projects including search and advertising.[15][18] In 2011, he was appointed as Yahoo!'s chief strategy officer.[1]
> In 2012, Prabhakar joined Google after severe funding cuts in Yahoo!'s research division.[19] In 2018, he was put in charge of Ads and Commerce at Google and in 2020 his scope was expanded to include Search, Geo, and Assistant.[20] [21]
It sounds like you are either unintentionally spreading misinformation, or misinformed.
They never said he was there in those years or was involved in the failed acquisitions. Had Google been acquired then, yes, eventually Raghavan would have been calling the shots.
> In inclined to believe that neither would have become trillion dollar companies if they had been acquired by Yahoo.
Having worked for Yahoo, I have to agree. Acquisitions were always seen in terms of "what can they do for the Yahoo brand?" and "How can we cut costs by migrating this to Yahoo tech?", not "How can we grow this business?". A Yahoo owned Facebook would have been suffocated like Tumblr and Flickr were.
Now I want a counter factual story about Yahoo acquiring Facebook, which then never flourishes into the influential network it became. What happens to society? Would we have the same political climate?
I feel like SOUTHLAND TALES, a movie written and shot before the iPhone was released, is quite helpful here. The movie emphasizes all of our post-9/11 failings in American culture at a time before Facebook or Twitter or any of the social media nonsense people blame the current awfulness on. The problems we face as Americans are far deeper than "cell phones" or "the Internet".
I want to know this too! If I invent a time machine, I'll message you but till then here's my ungrounded take (Obviously everything here is my personal opinion and not evidenced)
The current political climate has mainly happened because capital interest has taken control of unregulated news and opinion. Meta are a particularly bad example of this, but as long as there's money to be made by providing a platform for polarising politics and fake news, then I think someone will do so.
Who knows, maybe in that alternate universe you'd be posting "if Yahoo hadn't made such savy choices, I wonder if we would have the political climate we have today?"
> The current political climate has mainly happened because capital interest has taken control of unregulated news and opinion
This has always been the case for as long as society has been consuming the news. “Business tycoons” have bought up newspapers and media outlets since forever to push their narrative.
I think one component that has changed is the sheer volume and diversity of media makes competition for your attention (clicks) all the more fierce. Enter The Algorithm and optimizing for metrics above all else.
I dunno. That doesn’t invalidate anything about the original question about what present day would be like without Facebook. Would something else similar have replaced it? Is Facebook really “the problem” or is it algorithmic content because algorithmicly driven content was going to happen facebook or not.
It wasn't that bad when we had the Fairness Doctrine, which was removed in 1987. From there you could see a steady slide in US politics as polarization increased, from the Clinton scandal, to Gingrich and then Bush 2000. By the time Facebook hit it was already too late.
The Fairness Doctrine had a very limited influence on the media in general. It's power has been vastly over stated as of the last 15 years.
It was only applicable to broadcast media, and rarely enforced. Nearly all of the enforcement was on behalf of private individuals wanting free airtime to respond to negative new stories about them.
In my opinion it's a very bad idea to want political appointees to decide when an issue hasn't been given fair news coverage. The very idea that there is only 2 sides to an issue reinforces the two party system that has made media so biased in the first place
It's because of the fragmentation of news sources that can now be customized to one's preference with any finely sliced political cant desired. Three television networks maintained a measure of neutrality in their reporting. Mainstream print media did too albeit to a lesser extent. Wackjobs had a hard time finding each other to form a tribe that would destabilize society.
Before the rise of social media, the mainstream news ignored both things going on in minority communities like police violence and ignored rural America. The MAGA community and Trump himself bypassed the mainstream media because of social media.
America has always been polarized - institutions just never gave them a voice.
> The current political climate has mainly happened because capital interest has taken control of unregulated news and opinion.
We're seeing the opposite, though. As the traditional media companies declined and the masses gained a greater ability to voice their own views, polarization increased.
As someone who tries to avoid the news and politics, it's pretty easy to avoid the companies selling them. But I keep running into them because there are lots of users on Hacker News/Reddit/etc. who try to interject it into every discussion they can . Invariably, these people don't come at it from the point of view that they might be wrong and the other side might be right; they act like zealous crusaders on a mission to vanquish evil.
I don't dissagree, but I think I'm using "news and opinion" more loosely. To my mind, facebook putting your sister's political rant into your feed above your uncle's fishing pictures, is a kind of wauly of profiting from devisive political opinion. Even if it is more subtle than the NYT publishing a think piece.
Yes because before the current media landscape, politicians didn’t win elections by using dog whistles (Willie Horton), making some out group the villain or “segregation now. Segregation tomorrow. Segregation forever”.
Why are people acting like this is ancient history when my still living parents grew up in the segregated south and as recently as 2014 there were cities that still had segregated proms?
This is no media exaggeration. Forsyth county was notorious for this until the early 2000s. I (a Black guy) had a house built here in 2016 and sold it just last year when I relocated. While my son was one of the five Black guys in his entire school, we never experienced any issues so I don’t want to cast any aspersions toward Forsyth as it exist today.
Poul Anderson [1] in its short stories Time Patrol has this theory that the past can be disturbed to some extend, some things have to happen independently of particular individuals or events.
As a let down as it is for readers interested in how the author handles and solves time paradoxes (it is better than the insipid and sloppy multiverse solution, though) - Time Patrol are mostly history-focused action stories - this theory makes sense to me. At some point the world gets "ready" to discover things because all the pieces of the puzzle are in its hands. In the case of Facebook, I believe it is not an accident or "because Zuckerberg"; a massive social network had to emerge, in particular due to network effects.
Yes, but, would they be any where near the level of what FB achieved? Take Truth Social as an example. It started because people wanted a place they get out of the larger group to dedicate to like minded. In this Philip K Dick style rewriting of history where FB was created by those behind Truth, would it have ever achieved critical mass?
Just because someone else attempts to fill in the vacuum of something else not being there does not mean that it will succeed in filling the void. Truth only survives on the cult of personality, not because people really want to be using it or because it's like a good product
> Take Truth Social as an example. It started because people wanted a place they get out of the larger group to dedicate to like minded.
Not at all. It started because Trump was banned from Twitter. That’s it. The whole point was to give Trump a platform. There is nothing organic or natural about Truth Social and if it is the symptom of anything, it’s that some people just have too much money.
I kind of disagree in that the giving him a platform is just the cover for the actual purpose which is a way for anyone to shovel him money through a "legitimate" means to avoid any sense of bribe or quid pro quo. Very similar into how certain countries that wanted to curry favor made long term rental agreements for property owned by Trump. It was only slightly less obvious than dropping of bags in the oval office with $ marked on them.
Haha what? It’s the literal opposite mate. We’ve had an explosion of independent and non-capital aligned media. No matter what your brand of crazy is, you can find the “thought leaders” and community for you.
There's another comment along these lines too. I think my "news and opinion" phrase sounded like I exclusively meant mainstream news. But I was thinking more generally abouts "news and opinion content" like Breitbart, X comments, facebook rants, etc.
Yeah the explosion of the internet has allowed some conspiracy schizo person in the US to connect with another schizo conspriacy person across the world in Moldova to quickly find each other online and then confirm each others schizo beliefs.
Believe in flat Earth? Are you a holocaust denier? Think the moon landing is fake? Is the government gang stalking you? Welp you are in luck, there's thousands of other people just like you and here is a forum.
Yes, probably. But there's a spectrum. The UK has quite strict rules on air time to differing views (you can't air a climate change story which presents climate denial as the only opinion as news). I think those rules lead to a better system, not a more government controlled one.
Ironically, we (the UK) have the BBC which is fairly literally, government funded (not controlled) news. It's much more even handed than a lot of commercial news.
Britain's political culture is a bit of a disaster though. Kier Starmer was the best they could find in the last election and as far as I can tell even the people who voted for him don't seem to support him in the main. This time last century they controlled 20% of the worlds population and sat in a vast network of trade and technological innovation all feeding back towards the British Isles.
Then through basically an ongoing refusal to engage with political realities they've managed to transition to the number 5 and dropping economy in nominal terms and, realistically, probably don't have the industrial oomph to back up the paper numbers. There was political debate recently over whether the country should even be able to produce steel. Per capita the picture is a bit worse, and on a PPP basis they're actually a hair below the European average. They've also managed to become relatively politically isolated because no view seems to have gained ascendancy over what their foreign policy should look like.
Now it'd be unfair to blame it all on the present crop given the huge amounts of damage done in WWII, but it is a bit difficult for me to accept the trendlines of the UK compared to the recovering USSR countries or China/Taiwan while believing that there is a healthy political discourse. The high performing countries have done amazing things even from a standing start in the 70s, 80s and 90s. From such a dominant starting position, with the momentum of the old empire and technically being on the winning side of pretty much every major conflict and ideological UK politics seem to have done rather badly. The country is wildly average for somewhere that was so ahead of the game relatively recently and with so many opportunities to succeed in the interim and such poor quality of candidates allowed to hold power.
We would have had something else with same effect. The age was ripe with social media, orkut, Facebook, MySpace, and so many others I cannot even remember.
One analogy is local news media ecosystems across the US, which have generally looked pretty similar though not 100% identical over the past ~125 years or so, suggesting some determinism based on broader culture and technology.
If Facebook had stumbled, something else would have gotten the next microgeneration of college students and then their parents and grandparents.
It’s possible to me that an independent Instagram would have filled Facebook’s niche a few years later, and something like Snapchat would have taken the current Instagram niche. Maybe Twitter would have played a different role.
It’s also possible a web 2.0 answer to classmates.com would have grabbed the older crowd, and we’d have a slightly more profound age split.
But ultimately I think we’d end up where we are — a set of platforms algorithmically curating feeds of user-generated content — with a few cosmetic differences.
Facebook's hook was that at first it was only at certain colleges, and then it expanded but I think you still needed an invite to join. In the early days it wasn't full of high schoolers and junior high kids like MySpace was. Facebook really used exclusivity and FOMO to drive viral growth.
Facebook is pretty bad for society, but Twitter has also been quite bad. IMO Twitter has always been the real problem. Facebook replaced Email as the channel of choice for your weird relatives to spread conspiracy theories. And that is bad, but it is just an enhancement of a constant thing.
Twitter: all the journalists and elected officials signed up and decided the stuff that went on there Mattered and was News. The shitposts that showed up in their feed became social trends.
It is a widespread failure, but if we had to pick a thread that we should call the start of that part of the unraveling, I’d point at Twitter. I mean, that’s just the social media bit. Social media didn’t cause, like, Afghanistan or whatever.
Yeah, all social media has been pretty toxic for society. But Twitter has been especially bad. Turns out that requiring everyone to use very short messages means that interactions devolve into short, hot takes almost immediately. And then people just get angrier and angrier at each other as they fight back and forth via those barbs. Twitter couldn't have done more to unravel the social fabric if they actively tried to.
I think if bay area companies had behaved differently in early treatment of Facebook I don't think we would have ended up with such a paranoid/aggressive Facebook and things would have been much better, even if Facebook still became super successful. I think some of those early purchase attempts/behaviors are WHAT made Facebook the bad thing it became. Wonder if the juicy stories ever come out.
No it would just be a bunch of happy people messaging each other on Yahoo Messenger. We were never meant to see the inside of the brain of the average human put on public display.
Delicious was the only useful bookmark manager ever. Nothing ever came close to replacing it. Though for me the “social” part was pretty useless (plenty of actual link aggregators out there to discover content at the time)
…god remember the “tags” phase of content organization?
Delicious was cool because of the constant streaming of links and things that I was able to discover back then. I would sit there and just click on links, finding good content
For me it was always: Google, YouTube, Reddit and forums. There are also niche sites that cater to certain groups and interests like Steam and Twitch for gaming or IMDB and Rotten Tomatoes for movies. There is no universal content discovery platform or engine(besides maybe Google).
Flickr incentivized uploading a lot of photos with metadata and was highly searchable. It was great for photo hobbyists building a personal archive for others to peruse.
Instagram was for smartphone photos and playing with filters to set a vibe, and ephemeral sharing with friends and people you wanted to impress. It’s hardly searchable at all.
It sounds like an Instagram style app, with Flickr as the backend would be ideal. People could still share for fun from their phones, while actually being able to find and organize old photos, if they wish.
Exactly. If Yahoo was capable of nurturing Google into what it became, it was also capable of simply becoming that first. But it didn’t, because it wasn’t run by the same people who ran Google.
And I’m not saying that only Page and Brin were the only ones who could have made Google, only that they clearly were two people who were capable of doing it. However, Yahoo was not run by such people. So Yahoo would have bought Google and would have made Google conform to Yahoo’s culture, probably relegating Page and Brin to lesser roles where they couldn’t drive company culture.
> In inclined to believe that neither would have become trillion dollar companies if they had been acquired by Yahoo.
Yeah exactly. Also I would consider the Overture acquisition extremely successful because their patent lawsuit v. Google gave them 8% of Google pre-IPO. If held (which it was not), that is a substantial asset today.
You are spot on, but you are drawing a slightly wrong conclusion, IMHO:
Yes, Overture what the best Yahoo! acquisition ever made.
But Yahoo!'s greatest mistake was to settle the Google lawsuit for a few million dollars - which meant that Google could keep using Overture's (parented) invention of keyword bidding based advertising; without it, Google may never have found a way to become profitable.
So Yahoo! bought its own gravestone for $50m, when all they would have had to do is stand firm and go to trial.
If Y! exercised its government-awarded monopoly rights for keyword auction based advertising, there may still be that Y! portal that was so prominent in the early 2000s.
PS: Yahoo Inc. is not full gone - Yahoo Japan remains the last independent part of the former Y! - see https://www.yahoo.co.jp .
Sure; but (IIRC) at the time Facebook was burning cash and the board could have threatened future funding if he refused the offer. He may have been able to get more funding anyway but the larger point is these things are never as simple as the legal docs might imply.
Yup It is power dynamics always, legal documents only matter in court.
At the time in 2006 there were plenty of competing networks and any one of them could have climbed to the top.
Facebook wasn’t unique tech wise by all accounts one huge 20k line main file not like Google with PageRank or pegs viaweb written in Lisp or Amazon with early aspects of AWS.
FB could have been replicated and with right money scaled by anyone else , the challenge was there were series of spectacular growth and failures in the social network space
The tech innovations started first with Hack as a PHP compatible language couple of years later then things like relay , graphQL, react and so on.
Where I live, the early Facebook apps were the killer feature of the early days of Facebook.
Genuinely asking, what other software company did something like this back then? I'm tempted to say (tounge in cheek) FB was the original PaaS, but maybe im not old enough
Flash Apps hosting which was Facebook did then was not ground breaking at all, There were many other competing flash hosting sites .
The killer thing others couldn’t do Facebook did was make available social APIs for the app developers to integrate into their platform to make the apps viral, which benefited both them and Facebook.
OG PaaS in the Web 2.0 age IMO was the google app engine , it predated all AWS offerings and gave an actual application runtime .
The follow-up after Jerry Yang initially refused Ballmer: somehow Jerry had a come-to-Jesus moment and decided to sell but by then Ballmer changed his mind. Jerry even chased Ballmer on a golf course trying to sell but to no avail.
It is an interesting thought experiment. Would Yahoo have become Google, or would another company have taken Google's place, or perhaps something entirely different would have played out. Would we have had Android? Would we have had Chrome, or Google Maps, and so on
The board is in control of any company.
Having the controlling votes means being able to reappoint the board but would have to do so by following the company's constitution which may take some time.
For example, some companies only allow reappointing board members at certain times of the year.
I'm still not seeing any mechanism by which they could force him to sell, though. Even if the board fired him and he couldn't replace the board right away due to the corporate constitution, how are they going to force him to sell his shares if he doesn't want to?
Shareholders of companies are "along for the ride" and simply participate in the decisions of the board. In theory if they fired Zuck and appointed a interim CEO and directed that the company get sold, then it could have happened and Zuck would just be allocated his percentage of the value paid by Yahoo.
In practice I would guess there would be lawsuits filed immediately to hold up any such activity until he had time to exert control of the board, but it would have been interesting nonetheless.
So you're saying that in principle, the board could have forced Zuckerberg to sell his shares even if he didn't want to? It seems like it should be wildly illegal to forcibly deprive someone of their property like that.
The board is supposed to act in the interest of _all_ shareholders, not just majority or controlling. Meaning, a group of minority shareholders could sue for discrimination as happened at Tesla recently.
Also, I’m not sure of the ownership structure, but he may own 57% of voting stock but a minority of non voting stock, and the non-voting members may have certain rights irrespective of voting rights. I’d be shocked if they didn’t negotiate some kind of escape hatch.
Wondering the same, would love if someone could explain it. Hypothetically if Founder / CEO have 100% voting rights and all current public shares have non-voting right, the board could still fire the CEO?
i.e The only way to prevent this from happening would be to stay private?
After those companies didn’t sell to Yahoo, they went on to develop new things, which led to growth. If Yahoo has bought them, they’d just let them get old and fade away, eventually shutting them down… or at best keeping them around with minimal maintenance. Yahoo is where once great sites go to die.
I guess the question is how many other companies did they correctly identify as not being trillion dollar companies. They will be optimizing for different things than VCs. Also, it is very possible they would have run one or both into the ground, making them bad investments anyways. We like to dunk on Yahoo with our perfect hindsight, but they were probably reasonable decisions at the time. So yes I agree with this comment.
The truth is that bad leadership and no clear vision led to Yahoo's decline. They went through over half a dozen CEOs in a short span and each had a different strategy.
They failed to buy Google and Facebook, instead they bought GeoCities, Tumblr, and Broadcast for billions and ran them into the ground.
> In inclined to believe that neither would have become trillion dollar companies if they had been acquired by Yahoo.
People also like to point to how foolish of Blockbuster it was not to buy Netflix when they had the opportunity to, but I’m also inclined to believe that the merged companies would never have made the decisive moves involving streaming video and content production. It’s tempting to say that Amazon would have filled in the streaming video gap (although perhaps late enough for feature film and TV piracy to proliferate a little further into the mainstream), but I wonder whether Apple would have adapted its iTunes service into Apple TV first. (Another dark horse I like to think about here would be RealMedia which may have identified a niche.)
> In inclined to believe that neither would have become trillion dollar companies if they had been acquired by Yahoo.
Having lived through several acquisitions - both as a founder exiting and as an employee being acquired/acquiring...
Very rarely does the acquirer have the vision to see when the acquired company has a better long term trajectory. The CEO who does the deal might, but the senior management team and line managers usually just intentionally and unintentionally rob the acquired company of resources (cash, people, marketing, facilities) and then the exodus of smart people begins. It takes a very special team to make acquisitions actually add up to 1+1=4 most are lucky to get 1+1=0.5.
There is no strong method for predicting the future. Acquired/could have acquired in particular doesn't have predictive ability.
"Acquiring" is meaningless. Even "plans for the company after the acquisition" is meaningless. Credible reports of motivations that would lead the acquiring company to take a hands off approach to the company acquired means at least a little bit, having now seen companies taking that approach not immediately killing the golden goose.
Tumblr was 2-3x bigger than reddit apparently at acquisition time (just looking at google trends). Now reddit is public at 27B market cap, and tumblr is virtually worthless. I don't think there's anything fundamental about tumblr that would have prevented it from being the one in the sun instead. They're not dissimilar, and they could've used those years to grow tumblr in whatever direction they liked if there was indeed something stalling it.
I know a fair bit about this deal. Some massive percentage of Tumblr's traffic was porn. And, shockingly, Yahoo management did NOT know this when they signed the check.
And yahoo! leadership agreed. They probably intended to just bury the tech and keep some staff which is why they didn’t pay the asking price. Had they thought either of these properties were transformational they’d have paid.
> In 2002, Google offered to sell again for $1 billion. Yahoo hesitated and Google raised its price to $3 billion. Yahoo declined at the higher price. Google went on to become a trillion dollar company.
> Yahoo attempted to acquire Facebook for $1 billion in 2006, but Mark Zuckerberg turned down the offer. Had Yahoo increased its offer by just $100 million, Facebook’s board would have forced Zuckerberg to take it. Facebook also became a trillion dollar company.
In inclined to believe that neither would have become trillion dollar companies if they had been acquired by Yahoo.