Yahoo: Passing on Google for $1 Million and Refusing Microsoft's $47B

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Yahoo began in 1994 as Jerry and David's Guide to the World Wide Web, a human-edited directory built by Stanford electrical engineering graduate students Jerry Yang and David Filo. The founders linked the name to the Yahoos of Gulliver's Travels, though it also stood for Yet Another Hierarchically Organized Oracle. After an April 1996 IPO, Yahoo bought RocketMail, GeoCities for $3.6 billion and Broadcast.com for $5.7 billion to build a portal, and its stock peaked near $119 in January 2000 before falling to about $8 in 2001. In 1998 Larry Page and Sergey Brin offered to sell Google's algorithm for $1 million and Yahoo passed; in 2002 CEO Terry Semel offered $3 billion, Google asked for $5 billion, and Yahoo walked away again.

In 2008 Yahoo's board rejected a Microsoft offer raised to $47 billion, and Microsoft went on to build Bing. A run of chief executives followed: Carol Bartz was fired by phone in 2011, Scott Thompson lasted 130 days, and Marissa Mayer bought Tumblr for $1.1 billion in 2013 while facing lawsuits over her performance rating system, most claims of which a magistrate judge dismissed. Yahoo later confirmed that all 3 billion user accounts had been compromised in an August 2013 theft that relied on forged web cookies. Verizon agreed in 2016 to buy the core business for $4.83 billion, cut the price by $350 million after the breach disclosures, and closed the deal in June 2017.

• After licensing Google's technology from 2000, Yahoo bought Inktomi for $280 million to build its own search.
• In 2005 journalist Shi Tao was sentenced to 10 years in prison after Yahoo provided his email data to Chinese authorities.
• Scott Thompson cut about 2,000 jobs and left with at least $7.3 million after roughly four months.
• Yahoo closed GeoCities in 2009, deleting millions of user-built web pages.
• The Alibaba and Yahoo Japan stakes became Altaba, while the media unit, Oath, was 90% sold to Apollo Global Management in 2021.