9 ms·

Yahoo investors rankle at spin-off plan, one suggests laying off 9,000

47 points by pavornyoh 11y ago

thinkingkong 11y ago
From the article it seems like one institutional investor wants to lay off 9000 people. Im not sure whats worse. The layoffs or the story circulating in the media. Would love to hear what morale is like right now, over at Yahoo.
- buserror 11y ago
  They are not real people for "institutional investor", they are just numbers that costs money, money that could be /in their own pocket/ instead of wasted buying food and other perks. Clearly what he means is that she's not a Carly grade of CEO, firing 10k+ employees [0] and deeming the whole episode a resounding success. [0]: http://carlyfiorina.org/ http://carlyfiorina.org/
  - zipwitch 11y ago
    Well, what do you expect? P-zombies' facsimile of empathy can only stretch so far.
  - yuhong 11y ago
    I agree, but the sad thing is that I think doing a mass cutting of middle management would probably actually be a good idea.
steven777400 11y ago
Employee morale must be terrible. Even worse is the idea that a significant improvement will come from "eliminating employee perks like free food and company iPhones", which are a tiny fraction of the total cost of an employee, but the cutting of which sends a strong negative signal and may result in further loss of productivity and morale.
- zhang3r 11y ago
  not to mention, there aren't many places for food around 1st and matilda. A starving employee would have lower output.
  - Armand_Grillet 11y ago
    As Yahoo! spent $450M over 4 years to deliver food catered by Bon Appetit to its workforce, starvation must not be an issue for the employees. (Source: http://www.businessinsider.de/yahoo-shareholder-presentation-2015-12?r=US&IR=T http://www.businessinsider.de/yahoo-shareholder-presentation...)
- spydum 11y ago
  indeed. what is shameful is about 1-2yrs ago it seems like yahoo was on a hiring (well.. interviewing/recruitment) binge. to be fair, anybody whos been at yahoo for the long haul, or recently hired in should have known it was a risky environment. it's not like investors have been silent
- deleted 11y ago
  [deleted]
- shostack 11y ago
  Not to say there aren't issues with this, but I think there is also something to be said around expectations. If your company is not healthy, perks tend to suffer because at the end of the day, they don't matter if you have to fire everyone. There's a certain type of individual who picks a company based on perks, and when a company is in trouble, you'd much rather have employees that are there for the business and the mission. Now, that said, this is Silicon Valley. Free food and company phones are table stakes for any company wanting to hire and retain top tech talent. Combined with the fact that these two perks in particular enable improvements in employee productivity, and I think that would be a very dumb move.
  - mratzloff 11y ago
    How many employees believe in Yahoo's mission? What even is their mission?
deleted 11y ago
[deleted]
makecheck 11y ago
I'm really sick of "investors" thinking that trimming every little cost here and there is going to somehow fix things. As if they didn't have dozens of historic examples to show them what penny-pinching will do? Employees will be pissed off! The ones that stay will basically reduce their enthusiasm and valuable work output to 0%, if not actively sabotaging you by aggravating your remaining customer base with incompetence. The rest (probably the most talented ones) will leave, dooming all projects so that in 3-6 months the company will want exactly the same cuts again. Here's a different approach: cut at least one big idea or product line that isn't going anywhere, that your competitors have long since dominated. Then, aggressively refocus the company on making the remaining products great. And that doesn't mean being cheap; indeed, they may want to hire dozens or hundreds to help the focus areas become as unique and valuable as they possibly can be. It may even be necessary to make some pitches to attract new investors around those products. And yes, keep giving those people iPhones and free food; don't be ridiculous, you need that to offset the fact that there's a dozen other places they could be. It also sure wouldn't hurt if they could at least try to get back into the public eye. When's the last time you saw a commercial for Yahoo, or could even name what it is that they do?
- vidoc 11y ago
  > When's the last time you saw a commercial for Yahoo, or could even name what it is that they do? A few weeks back there were still hundreds of yahoo ads all over san francisco. Albeit it didn't communicate on anything else than a logo, I am not too sure marketing is what yahoo needs to exit its technical mediocrity.
  - MangoDiesel1 11y ago
    Same ads are running in Boston. Nothing except a yahoo logo.
  - makecheck 11y ago
    Well for instance, if I see a commercial for something like Expedia I know immediately what Expedia is and how it can be used. I also know the web site name. At the very least, Yahoo needs that type of thing: something to remind us who they are and why the hell you would visit their site.
tayloormon 11y ago
Get rid of the incompetent CEO, forced diversity was a mistake.
steve19 11y ago
Could someone explain the tax situation to me? If putting the Alibaba holdings into a separate company would incur tax, why can't they just put everything else into a separate company, called say "Yahoo Media", and leave YHOO with just the Alibaba ownership?
- swang 11y ago
  Isn't that what they're trying to do? Spin off all of Yahoo's current business into a new company, leaving current Yahoo with just the shares of Alibaba.
- harryh 11y ago
  As usual, Matt Levine is excellent at explaining these sorts of things: http://www.bloombergview.com/articles/2015-12-02/yahoo-is-looking-for-a-new-way-around-alibaba-taxes http://www.bloombergview.com/articles/2015-12-02/yahoo-is-lo...
- georgeott 11y ago
  I don't get it. Why shouldn't Yahoo pay the taxes? They invested in Alibaba, and have made HUGE gains, and if they want to realize those gains, they need to pay the taxes.
  - phamilton 11y ago
    The shareholders of YHOO will pay taxes regardless. If YHOO wants to spend the money from Alibaba, it will (and has already done so) pay taxes. The question is whether YHOO should pay taxes before returning the gains to the shareholders, who will then pay taxes.
atarian 11y ago
http://steveblank.com/2009/12/21/the-elves-leave-middle-earth-%E2%80%93-soda%E2%80%99s-are-no-longer-free/ http://steveblank.com/2009/12/21/the-elves-leave-middle-eart...

47 points by pavornyoh 11y ago

From the article it seems like one institutional investor wants to lay off 9000 people. Im not sure whats worse. The layoffs or the story circulating in the media. Would love to hear what morale is like right now, over at Yahoo.

buserror 11y ago
They are not real people for "institutional investor", they are just numbers that costs money, money that could be /in their own pocket/ instead of wasted buying food and other perks. Clearly what he means is that she's not a Carly grade of CEO, firing 10k+ employees [0] and deeming the whole episode a resounding success. [0]: http://carlyfiorina.org/ http://carlyfiorina.org/
- zipwitch 11y ago
  Well, what do you expect? P-zombies' facsimile of empathy can only stretch so far.
- yuhong 11y ago
  I agree, but the sad thing is that I think doing a mass cutting of middle management would probably actually be a good idea.

steven777400 11y ago

Employee morale must be terrible. Even worse is the idea that a significant improvement will come from "eliminating employee perks like free food and company iPhones", which are a tiny fraction of the total cost of an employee, but the cutting of which sends a strong negative signal and may result in further loss of productivity and morale.

zhang3r 11y ago
not to mention, there aren't many places for food around 1st and matilda. A starving employee would have lower output.
- Armand_Grillet 11y ago
  As Yahoo! spent $450M over 4 years to deliver food catered by Bon Appetit to its workforce, starvation must not be an issue for the employees. (Source: http://www.businessinsider.de/yahoo-shareholder-presentation-2015-12?r=US&IR=T http://www.businessinsider.de/yahoo-shareholder-presentation...)
spydum 11y ago
indeed. what is shameful is about 1-2yrs ago it seems like yahoo was on a hiring (well.. interviewing/recruitment) binge. to be fair, anybody whos been at yahoo for the long haul, or recently hired in should have known it was a risky environment. it's not like investors have been silent
deleted 11y ago
[deleted]
shostack 11y ago
Not to say there aren't issues with this, but I think there is also something to be said around expectations. If your company is not healthy, perks tend to suffer because at the end of the day, they don't matter if you have to fire everyone. There's a certain type of individual who picks a company based on perks, and when a company is in trouble, you'd much rather have employees that are there for the business and the mission. Now, that said, this is Silicon Valley. Free food and company phones are table stakes for any company wanting to hire and retain top tech talent. Combined with the fact that these two perks in particular enable improvements in employee productivity, and I think that would be a very dumb move.
- mratzloff 11y ago
  How many employees believe in Yahoo's mission? What even is their mission?

deleted 11y ago

[deleted]

makecheck 11y ago

I'm really sick of "investors" thinking that trimming every little cost here and there is going to somehow fix things. As if they didn't have dozens of historic examples to show them what penny-pinching will do? Employees will be pissed off! The ones that stay will basically reduce their enthusiasm and valuable work output to 0%, if not actively sabotaging you by aggravating your remaining customer base with incompetence. The rest (probably the most talented ones) will leave, dooming all projects so that in 3-6 months the company will want exactly the same cuts again. Here's a different approach: cut at least one big idea or product line that isn't going anywhere, that your competitors have long since dominated. Then, aggressively refocus the company on making the remaining products great. And that doesn't mean being cheap; indeed, they may want to hire dozens or hundreds to help the focus areas become as unique and valuable as they possibly can be. It may even be necessary to make some pitches to attract new investors around those products. And yes, keep giving those people iPhones and free food; don't be ridiculous, you need that to offset the fact that there's a dozen other places they could be. It also sure wouldn't hurt if they could at least try to get back into the public eye. When's the last time you saw a commercial for Yahoo, or could even name what it is that they do?

vidoc 11y ago
> When's the last time you saw a commercial for Yahoo, or could even name what it is that they do? A few weeks back there were still hundreds of yahoo ads all over san francisco. Albeit it didn't communicate on anything else than a logo, I am not too sure marketing is what yahoo needs to exit its technical mediocrity.
- MangoDiesel1 11y ago
  Same ads are running in Boston. Nothing except a yahoo logo.
- makecheck 11y ago
  Well for instance, if I see a commercial for something like Expedia I know immediately what Expedia is and how it can be used. I also know the web site name. At the very least, Yahoo needs that type of thing: something to remind us who they are and why the hell you would visit their site.

tayloormon 11y ago

Get rid of the incompetent CEO, forced diversity was a mistake.

steve19 11y ago

Could someone explain the tax situation to me? If putting the Alibaba holdings into a separate company would incur tax, why can't they just put everything else into a separate company, called say "Yahoo Media", and leave YHOO with just the Alibaba ownership?

swang 11y ago
Isn't that what they're trying to do? Spin off all of Yahoo's current business into a new company, leaving current Yahoo with just the shares of Alibaba.
harryh 11y ago
As usual, Matt Levine is excellent at explaining these sorts of things: http://www.bloombergview.com/articles/2015-12-02/yahoo-is-looking-for-a-new-way-around-alibaba-taxes http://www.bloombergview.com/articles/2015-12-02/yahoo-is-lo...
georgeott 11y ago
I don't get it. Why shouldn't Yahoo pay the taxes? They invested in Alibaba, and have made HUGE gains, and if they want to realize those gains, they need to pay the taxes.
- phamilton 11y ago
  The shareholders of YHOO will pay taxes regardless. If YHOO wants to spend the money from Alibaba, it will (and has already done so) pay taxes. The question is whether YHOO should pay taxes before returning the gains to the shareholders, who will then pay taxes.

atarian 11y ago

http://steveblank.com/2009/12/21/the-elves-leave-middle-earth-%E2%80%93-soda%E2%80%99s-are-no-longer-free/ http://steveblank.com/2009/12/21/the-elves-leave-middle-eart...