Ex-Yahoo CEO Marissa Mayer regrets her call on Netflix
Marissa Mayer, former CEO of Yahoo, has some regrets. Six years after leaving the role, she opened up this week about things she should have done differently.
“We looked at a transformative acquisition, and we bought Tumblr,” she said in a Tech Brew interview.
Yahoo acquired Tumblr, a social blogging platform, for $1.1 billion in 2013—a deal Mayer was heavily involved in. It soon became clear the price was far too high: By 2016, Yahoo had written down Tumblr’s value by more than $700 million.
But in addition to Tumblr, she said, the company had considered the possibility of buying Netflix or Hulu.
“I think Netflix was $4 billion and Hulu was at $1.3 billion at the time,” she told Tech Brew. “And either of those, with hindsight being 20/20, would have been a better acquisition.”
That’s something of an understatement. Today Netflix’s market cap tops $140 billion, and Disney has majority-owned Hulu since 2019.
As much as Mayer might wish she’d attempted to acquire Netflix, however, the regret runs much deeper among former Blockbuster executives. In 2000, Netflix cofounders Reed Hastings and Marc Randolph tried to sell their startup to Blockbuster for a mere $50 million—and were laughed out of the room.
At the time, of course, Netflix was an unprofitable startup offering DVD rentals via postal mail, while Blockbuster stores were a fixture of American life.
Today, Mayer is the CEO and cofounder of Sunshine, a startup offering an app that uses A.I. to organize contacts on smartphones. “We mused about naming the company Mundane AI,” she told Tech Brew. “How do you take cutting-edge AI and just apply it to everyday problems that we all have to deal with?”
Mayer shared a few other regrets. She admitted she hired the wrong person to be her chief operating officer. In 2014 she ousted Henrique De Castro, whom she had personally chosen for the role in 2012 despite warnings that it was a mistake and he was overcompensated.
And, she said, she wished she had “done the tax-free Alibaba spinoff,” which would have “saved $10 billion for our shareholders or made them that money” and “allowed Yahoo to continue as an independent company.”
Three months ago, Yahoo, now owned by Apollo Global Management, said it would eliminate about 1,000 jobs and will further reduce headcount later this year.