ou never, ever want to compete with Microsoft." That's Jerry Yang talking back in November of 1997 long before Google ambushed Yahoo and it was cute to cast Yang and Filo as "barefoot millionaire boys" (CNET), as though they had sauntered out of Dogpatch chewing haystems. Back then Yang expanded on his mortal dread of going head-to-head against Microsoft: "And even if they want to compete with you, you run away and do something else." He was still shaken by the memory of the mauling Gates had inflicted on poor Marc Andreeson and the bright comet that once was Netscape.
Thirty then, Yang was still too young to have learned the immutable rule of life: we must face what we most fear.
The mechanism life used to throw Yang into the Lion's den? The same one used to torment all fools with an eye on posterity. Posterity means, essentially, eyeballs, and a craving for eyeballs can only be fed by a ceaseless questing for ad dollars. That in turn leads, of course, to the madness of dreams of media domination.
But let's back up.
By then Bill Gates himself had known for a decade that brainwork, especially when commercially successful, inspires musings on posterity. When you've forced over 90% of digital humanity to inhabit your mindscape, you start casting around for other ways to gratify your burgeoning sense of destiny. Seeing that he was on a collision course with the likes of Time-Warner and Disney-ABC, Gates was smart enough to know that it was the media giants' appetite for outsize success stories that had catapulted him to the throne of earth's software sovereign. So he cast himself as an overgrown computer nerd who would like nothing better than to hole up in a cubicle and hash out a few vexing lines of code.
Jerry Yang knew a winning strategy when he saw one. The only way to realize his dream of making Yahoo more than a geek tool, he reckoned, was to turn it into a media giant oozing content. Wanting the same moonshot that Gates had gotten, he held his ambition as close as a dealt pair of aces and grinned with the insouciance of a true yahoo. An outsized personality is the E-ticket for the media catapult.
"People always ask me why I took myself out of the day-to-day operating responsibility," Yang explained. "That's never what I wanted to do, and besides, I knew so little about business that I didn't want to slow things down when the company began to scale up. And anyway, to me, the broader the role, the more exciting it is. Yahoo is in everything from pets to old people to finance to communications to e-commerce and more, and I really thrive on that."
To Filo, Srinivasan, Koogle, Mullett & company Yang left the obscure toil of screwing nuts to bolts and set off to spin the homey yarns and platinum platitudes that keep journalists eating out of your hand. Between the time Yahoo incorporated in April 1995 and January 7, 2000 when it peaked out at a valuation of nearly $140 billion, Yang appeared on countless magazine covers and TV broadcasts around the world. In the calculus of modern business, the value of that exposure at prevailing cost-per-thousand rates equals Yahoo's peak valuation.
"To me, building an organization that scales smoothly is the true test of an entrepreneur," he told Fortune in 2000. "Often what it comes down to is how well the founders continue to scale themselves. Look at what Andy Grove did in the last 25 years at Intel, or Bill Gates or Steve Jobs. I'm still a babe compared with them."
His song and dance was playing the lucky naif whose goofy hobby site started laying golden eggs, on the one hand, and on the other, waxing geeky about the challenges of building a filing cabinet big enough for the internet. "Yahoo, itŐs more like a huge library or archive," he told Fortune in early 2000. "ThatŐs the reason we crafted human categories rather than fully automate the search process." He would never dream of becoming another Microsoft-style marauder, avowed. "We're not an e-merchant; we're an enabler for other e-merchants. We're not competing with Amazon or Barnes & Noble." All the while the chief Yahoo was chiefly casting about for ways to go from being a search tool to the ultimate destination.
The first big step down the road to becoming a media company came naturally enough. A Golden Bear named Masayoshi Son -- known as Japan's Bill Gates, though more Yang's age -- had bought himself a dominant 37% stake in the two wild Cards' creation and had leveraged it into collateral for the purchases of digital publisher Ziff-Davis. As early as 1996 Son interested Yang and Filo in taking the Yahoo name into print with titles like Yahoo Internet Life and Yahoo Computing.
By April of 1999, with Yahoo's stock price soaring past the $150 mark, Yang felt the whipcrack of analysts frothing at the mouth about the internet's limitless potential and sniping at Yahoo's seeming unwillingness to leverage its user-base into media-giant status. PAGE 2