My friend and colleague Nicholas Carlson wrote about book about Marissa Mayer and Yahoo.
I got to read it months before it was released. I thought it was a great read. It moved quickly, and offered lots of new information on the company.
I chatted with Nich about the book for a podcast, which you can hear below. It’s sort of an overview of the whole thing.
Two of the biggest revelations in the book are about Henrique De Castro, Mayer’s first big hire, and Dan Loeb, the hedge fund manager who got Mayer the job as CEO.
Let’s start with De Castro.
Mayer’s expertise was in product management. She had never really run a business unit at Google. So, when she came to Yahoo, she needed someone to run the business.
She hired De Castro from Google. But, the hire was doomed from the start. He was the wrong guy to lead an ad sales organisation. De Castro wasn’t the sort of person that had the personality for smoothing over relationships with ad sales people.
People in the industry were immediately sceptical of De Castro working at Yahoo. Carlson had lots of sources warning that this would probably not work out when he was announced as Yahoo COO.
So, how did De Castro end up at Yahoo?
“They didn’t vet him,” Carlson said in our podcast. “Castro convinced Mayer, and Mayer convinced the board.”
That’s pretty wild considering she paid De Castro ~$US100 million.
However, Carlson gives Mayer credit for relatively quickly pulling the plug on De Castro. She saw he was the wrong guy and started cutting him out of the business quickly.
The De Castro firing was probably the smartest thing Mayer did as CEO. She could have stuck with him because she made a big investment in him, in terms of salary. But, she had the guts to admit she was wrong, and quickly cut him before it hurt her company further.
As for Dan Loeb…
Mayer forced Loeb out of the company.
Loeb was the one that got Mayer the job. He took a big position in Yahoo, forced out the previous CEO and landed Mayer. He was still on the board when she started. But, Mayer figured out a way to drop him.
This was a little surprising because Loeb was exactly what Mayer needed. He had expertise on capital markets, and dealing with investors. Mayer was a new CEO who could use someone like Loeb as a consultant.
Loeb, for his part, was enjoying working with Mayer and Yahoo.
Why did Mayer want Loeb out? Because, like any CEO she wanted absolute control. If Loeb had ever soured on Mayer, then it would have been trouble for Mayer. So, she was better off getting him off the board.
We talk Loeb, De Castro, and lots more in here: