One story that regularly crops up when it comes to Facebook’s history is the fact that Yahoo could have bought it for $1 billion in 2006.Mark Zuckerberg basically had a handshake deal in place to sell the company, but backed out at the last second.
There’s this unspoken idea that if Yahoo had landed Facebook it would be in better shape and it, not Facebook, would be the $100 billion company.
Just this morning, Buddy Media CEO Mike Lazerow suggested on CNBC Yahoo should have paid $3 billion for Facebook. It would have taken out a rival and picked up a valuable new asset.
Here’s the problem with Lazerow’s, and everyone else’s, thinking: Yahoo is and was a messed up place. It would have botched the Facebook acquisition, and Mark Zuckerberg would be working on a new startup right now.
Just look at what it did to Flickr, which it bought just a year prior to its talks with Facebook. (As Mat Honan at Gizmodo details, it killed Flickr and squandered an opportunity to own the web.)
So, please, before you ever say, “Yahoo could have owned social,” stop and think about what you’re saying.
Yes, Facebook could have spent $3 billion on Facebook, but all it would really mean is that it had $3 billion less in cash.