There are many people who have defended Marissa Mayer’s track record as CEO for the past four years, basically saying that Yahoo is a dinosaur and therefore it was an impossible task that she probably never should have taken in the first place.
I disagree.
It wasn’t an impossible task.
It just proved to be the case that Mayer was impossibly equipped to be the CEO at the time she took it over. Maybe if she’d been the CEO during Yahoo’s go-go ’90s days, it would have been fine. Growth covers up a lot of problems. Make a few Tumblr-sized acquisitions and buy up your friends’ companies, who cares when it’s a land grab. Don’t need to fire anyone? No problem. Want to have 28 direct reports when Zuckerberg only needs 10? Go for it.
But Mayer came in to the Yahoo CEO job when it expressly needed focus, shrinkage for profitability (and more focus), and smart bets on a future for the company. Instead, Yahoo got free food, lavish parties, and a little bit of daily habits, a little bit of digital magazines, and a little bit of NFL football.
Our 99 page case for why there needs to be significant change at Yahoo now and what that change needs to look like is here.
Near the back of the deck, we talk about what are the traits of the ideal next Yahoo CEO:
- Relevant industry experience in tech/digital/media
- A willingness to go in and mercilessly cut costs to take it down to the studs and build it back up again
- Sales experience and an understanding of who to hire to build a performance-based sales culture
- A willingness to fly to New York and Cannes and actually meet with advertising executives
- An understanding of where the world is moving in OTT
- Ad tech experience
- A passing understanding of what Wall Street investors expect from management teams (i.e., the antiquated notion of earning more than you spend)
- No snobbery when understanding and embracing Yahoo’s core audience who lives in “fly over” country and not in the bubbles of high society San Francisco and New York
So, the natural next question is who could do this?
There are many candidates.
First, let’s discuss who won’t take this job: Jeff Weiner, Sheryl Sandberg, or Tim Armstrong.
Weiner would be a great CEO for Yahoo. The problem is: he’s the CEO of LinkedIn — a real $30 billion company, not one that pretends to be one due to decades old investments in Alibaba and Yahoo Japan. Jeff would have been a great CEO for Yahoo after Terry Semel quit in 2007. However, Jerry Yang wanted the job — and took it in late summer 2007. Jeff left in June 2008. He’s not walking back through that door (unfortunately).
Why would Sandberg leave such a good job at Facebook for a really difficult job at Yahoo? Could she do it? Yes, but why would anyone want to leave the job she now has for the Yahoo job? That won’t happen.
Tim Armstrong could do this job — but he’s working for Verizon now for an unspecified period. If you believe the rumors, Verizon is interested in buying Yahoo’s core business. That’s really the only way Armstrong will run Yahoo. He’s not going to leave Verizon to run it.
So, who might actually take Yahoo now and have a decent chance of success today with all of Yahoo’s warts?
This is not an exhaustive list. There could be many other capable candidates. And there’s no silver bullet candidate who has all the traits on my list above. Every candidate has his/her own set of strengths and weaknesses. It’s really up to the board to decide who would be the best fit. Then, you need to ensure there’s a team built around that CEO to complement his/her strengths/weaknesses.
Here are my top 5 to take this job (listed alphabetically):
- Jim Lanzone. He’s running CBS Interactive today and doing well. CBS All Access launched successfully last year. A new version of “Star Trek” will be coming to it in the future. He runs a set of assets at CBS much like Yahoo does. He ran Ask before CBS. He’s an operator. He’s worked for a media company where profits matter. And he’s got a great Rolodex in the tech world. He’s got a pretty good job where he is but he certainly could do the Yahoo job if he wanted. Les Moonves shows no signs of slowing down in the near term, so that chair is probably not opening up soon. Lanzone definitely could take Yahoo down to the studs and then build it again.
- Ross Levinsohn. Hindsight is 20/20, but Levinsohn should have been picked four years ago. It’s frustrating to think of how much time and money got wasted by the board not selecting him. His strategy from then can basically be dusted off and applied now. He will lead a much smaller Yahoo with strong ties to the media world. If he was tapped, I would expect him to start to immediately reach out to some of his former team members who have left Yahoo over the years (Michael Barrett, Mickie Rosen, Jim Heckman, etc.). Levinsohn is a known quantity and his familiarity with the company is a plus.
- Jackie Reses. Mayer’s former No. 2 left Yahoo a few months ago to join Square. But she’s got a unique set of skills that could make her an excellent Yahoo CEO now. She worked in private equity before she took her job at Yahoo. What’s needed now at Yahoo? Focus and major cost cuts. She can do that. Reses also headed up the relationships with Alibaba and SoftBank. She knows the parties there much better than Mayer ever did. That’s going to be valuable as the company considers what to do there. Reses also knows Yahoo operations, though. She knows where the fat is, where the bodies are buried, and what the fully loaded costs are for different groups.
- Rich Riley. Rich spent 13 years at Yahoo. He sold his company to Yahoo in 1999 when Tim Koogle was in charge and stayed through Terry Semel, Jerry Yang, Carol Bartz, Tim Morse, Ross Levinsohn, and finally Mayer. He left in September 2012 and was named the CEO of unicorn Shazam a few months later. All those years of Yahoo mean he has (a) deep ties to the company, (b) strong contacts at the company and with the founders, and (c) strong ideas on what worked and what didn’t work at Yahoo over his tenure and seeing different types of leadership. Riley was extremely well-liked when he was there. He should be considered.
- Dan Rosensweig. Rosensweig is a people person. He’s well-liked and respected throughout the Valley. He’s also got strong ties to Yahoo’s co-founders. Rosensweig is another guy — like Weiner — who could have been Yahoo CEO before things went a couple of different ways. Instead, he left to run the “Guitar Hero” franchise before joining Chegg as CEO. He’s steered Chegg to an IPO and has stuck it out over the last couple of years, migrating it to a digital business. If he were to return to Yahoo now, there are many former Yahoos who would be happy. He built up a killer sales organization before at Yahoo and they need big help there now.
As reported by Business Insider