Yahoo's Rapid Rise and Fall Marked By Unbelievable Gaffes

Not many companies have botched so many great business opportunities like Yahoo.In a parallel universe somewhere, Yahoo! is one of the most valuable companies in the world.

Instead, in this universe, Yahoo! went out with a whimper, selling for a measly (relatively speaking) $5 billion to Verizon.


With different management, Yahoo! could have been one of the world's most valuable companies, as you'll soon see.

With different management, Yahoo! could have walked into the arms of Microsoft for roughly 10x the amount that they ended up selling for.

Instead, Yahoo! is one of the great "what ifs" in the history of the stock market.


Let's look at five instances when Yahoo! completely dropped the ball and missed out on a chance to completely alter their company's fortunes forever:

1. In 1998, two young men by the names of Larry Page and Sergei Brin approached a number of companies, including Yahoo!, about the possibility of purchasing Google.

The two men wanted to continue their studies at Stanford, and Google was taking up too much of their time.

Did a company like Yahoo! want to buy Google's intellectual property, etc.?

The asking price?

$1 million.

Yahoo! turned down Page and Brin.

2. In 2002, Yahoo! realized that they had made a grave error in turning down Google.

Yahoo! approached Google to purchase the company. Their offer? $3 billion.

Google reportedly countered with $5 billion.

Yahoo! turned them down again.

Google is now worth $1.38 trillion.

3. In February of 2008, Microsoft, in an effort to take on Google in the growing search engine arms race, offered $44.6 billion to buy Yahoo!

The two sides couldn't agree to terms, as Yahoo! thought that the deal significantly undervalued their company.

Microsoft ended up walking.

4. In 2006, Yahoo! offered to buy Facebook for a reported $1 billion.

According to reports, Zuckerberg turned down the deal, but a slightly higher offer from Yahoo! ($1.1 billion+) would have probably cinched things.

Could Yahoo! have closed Facebook if they were more aggressive? Many people think so.

In the end, Facebook remained independent, and they are now worth hundreds of billions of dollars.

5. Marissa Mayer, Tumblr and the Missed Opportunities.

Marissa Mayer, a high-profile "get" to serve as the new CEO of Yahoo!, was looking for a transformative purchase for the company.

Mayer has said that she eyed three companies closely - Tumblr, Netflix and Hulu.

Yahoo! chose to acquire Tumblr for $1.1 billion, and the acquisition was an unmitigated disaster.

Netflix was worth $4 billion at the time, and Hulu was worth $1.3 billion.

Both of these acquisitions would have been much, much better purchases than Tumblr.

Another fumbled opportunity for Yahoo!


As you can see, Yahoo! botched numerous opportunities over the years.

Filed under: General Knowledge

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