I think you have a valid point that Yahoo! is probably not laying off their top performers. However, the job cuts were large, and there is enough randomness in

I think you have a valid point that Yahoo! is probably not laying off their top performers. However, the job cuts were large, and there is enough randomness in the HR process to assume that the startup could find 5 good employees there. Not to mention, an employee in the bottom half at Yahoo would probably be an excellent employee anywhere else. Also, there are factors other than competence that play in to decisions like these, like tenure.