8 ms·

I don't think you understand how much the Alibaba shares that Yahoo held were worth (~$40 billion) and how little the rest of the business was worth (<$5 billio

I don't think you understand how much the Alibaba shares that Yahoo held were worth (~$40 billion) and how little the rest of the business was worth (<$5 billion). This is not a normal situation, where your point would usually be correct. She had zero responsibility for running Alibaba. She ran a business that was worth less than $5 billion, but was compensated based on a stock price that primarily moved based on the run-up in the $40 billion worth of Alibaba stock Yahoo held (and such stock was acquired before she became CEO). Here's one of many Matt Levine pieces that explained the Yahoo/Alibaba situation, although it's now dated: https://www.bloomberg.com/view/articles/2015-01-28/yahoo-would-rather-not-pay-taxes-on-its-alibaba-shares https://www.bloomberg.com/view/articles/2015-01-28/yahoo-wou...

run4yourlives2 10y ago
And? Was Meyer not the CEO when this happened? I'm pretty sure she was. Just because she resorted to something other than organically growing the business to increase the value to her shareholders doesn't mean she's a failure. We're all assuming that her job was to "save" Yahoo. I don't think that was ever really on the table.
- derefr 10y ago
  Your comment: > she resorted to something other than organically growing the business to increase the value to her shareholders Parent comment: > and such stock was acquired before she became CEO She didn't do "resort to" anything. Yahoo made that money from an action a previous CEO was ultimately responsible for. If you want to be really generous, you could praise her for not selling the stock—but if we're praising CEOs for every way they choose not to change the companies they come into, then my pet rock would make an awesome CEO indeed.
  - 1024core 10y ago
    > She didn't do "resort to" anything. You have to give her credit where it's due: she saved the Alibaba partnership from that total fuckup, Carol Bartz. CB was such a fuckup, that she's the sun to Marissa's candle. She insulted Jack Ma in front of his underlings when he came calling to Sunnyvale. She refused/forgot to put someone on BABA's board and totally ignored Ma. As a result, Ma said 'fuck you' and took Alipay out of the group without even telling Bartz. I wish more people looked at the period preceding Marissa (Bartz, Thompson) and they'd realize that Mayer was a Godsend compared to the cabal of clowns running Yahoo before her.
    - derefr 10y ago
      Even if it's true that her management was better than previous management, I think everyone here is applying a standard where someone shouldn't get compensated for management that was provably worse than no management, because having no management is free. If the board of directors had just told everybody to go on without a CEO, the company would have done better financially than if they had installed Marissa.
      - 1024core 10y ago
        Hindsight is 20/20.
- ethbro 10y ago
  I believe berberous' point is that if Yahoo's primary achievement (in terms of share value) had nothing to do with her, they could have appointed a stump as CEO and saved $186M+.
  - jhall1468 10y ago
    Actually a stump would have saved them money on tumblr and their terrible video service.
- AJ007 10y ago
  She was not present when Yahoo invested in Alibaba. Her job, presumably, as the CEO was to convince all of the enterprise's employees and customers that Yahoo would be sticking around for the long run. At the same time, she had to prepare to wind down the business while returning capital to the shareholders. I would call that a difficult job. My lesson from this is most companies with excess capital should make investments, not acquisitions. Most certainly a company with a long string of failed acquisitions should. Yahoo has been repeatedly given as an example, but others like Google don't have a particularly great record either. Berkshire Hathaway is a great example of a massive business centrally owned by a very barebones team (in Omaha.)
stagbeetle 10y ago
She was brought in to salvage the situation. By allowing those shares to accrue and not doing anything stupid at the wheel, she did her job. Whether or not it's fair or worth her comp, is irrelevant. The shareholders valued her work at a set amount and that's what she was paid. Unless you're taking an economic stance on the issue, wherein you believe shareholders are messing up future incentives and economic prosperity by recognizing and rewarding CEO's that do the bare minimum of "just don't fuck it up," or something similar, this debate is impractical.
thisisandyok 10y ago
> Here's one of many Matt Levine pieces that explained the Yahoo/Alibaba situation, although it's now dated I hadn't been following Yahoo that closely, but was vaguely curious about the whole Alibaba angle, thanks for linking that article

run4yourlives2 10y ago

And? Was Meyer not the CEO when this happened? I'm pretty sure she was. Just because she resorted to something other than organically growing the business to increase the value to her shareholders doesn't mean she's a failure. We're all assuming that her job was to "save" Yahoo. I don't think that was ever really on the table.

derefr 10y ago
Your comment: > she resorted to something other than organically growing the business to increase the value to her shareholders Parent comment: > and such stock was acquired before she became CEO She didn't do "resort to" anything. Yahoo made that money from an action a previous CEO was ultimately responsible for. If you want to be really generous, you could praise her for not selling the stock—but if we're praising CEOs for every way they choose not to change the companies they come into, then my pet rock would make an awesome CEO indeed.
- 1024core 10y ago
  > She didn't do "resort to" anything. You have to give her credit where it's due: she saved the Alibaba partnership from that total fuckup, Carol Bartz. CB was such a fuckup, that she's the sun to Marissa's candle. She insulted Jack Ma in front of his underlings when he came calling to Sunnyvale. She refused/forgot to put someone on BABA's board and totally ignored Ma. As a result, Ma said 'fuck you' and took Alipay out of the group without even telling Bartz. I wish more people looked at the period preceding Marissa (Bartz, Thompson) and they'd realize that Mayer was a Godsend compared to the cabal of clowns running Yahoo before her.
  - derefr 10y ago
    Even if it's true that her management was better than previous management, I think everyone here is applying a standard where someone shouldn't get compensated for management that was provably worse than no management, because having no management is free. If the board of directors had just told everybody to go on without a CEO, the company would have done better financially than if they had installed Marissa.
    - 1024core 10y ago
      Hindsight is 20/20.
ethbro 10y ago
I believe berberous' point is that if Yahoo's primary achievement (in terms of share value) had nothing to do with her, they could have appointed a stump as CEO and saved $186M+.
- jhall1468 10y ago
  Actually a stump would have saved them money on tumblr and their terrible video service.
AJ007 10y ago
She was not present when Yahoo invested in Alibaba. Her job, presumably, as the CEO was to convince all of the enterprise's employees and customers that Yahoo would be sticking around for the long run. At the same time, she had to prepare to wind down the business while returning capital to the shareholders. I would call that a difficult job. My lesson from this is most companies with excess capital should make investments, not acquisitions. Most certainly a company with a long string of failed acquisitions should. Yahoo has been repeatedly given as an example, but others like Google don't have a particularly great record either. Berkshire Hathaway is a great example of a massive business centrally owned by a very barebones team (in Omaha.)

stagbeetle 10y ago

She was brought in to salvage the situation. By allowing those shares to accrue and not doing anything stupid at the wheel, she did her job. Whether or not it's fair or worth her comp, is irrelevant. The shareholders valued her work at a set amount and that's what she was paid. Unless you're taking an economic stance on the issue, wherein you believe shareholders are messing up future incentives and economic prosperity by recognizing and rewarding CEO's that do the bare minimum of "just don't fuck it up," or something similar, this debate is impractical.

thisisandyok 10y ago

> Here's one of many Matt Levine pieces that explained the Yahoo/Alibaba situation, although it's now dated I hadn't been following Yahoo that closely, but was vaguely curious about the whole Alibaba angle, thanks for linking that article