After Yahoo, Mayer May Have to Wait for Another CEO Chance
July 26 2016 - 8:00AM
Dow Jones News
By Deepa Seetharaman
Yahoo Inc.'s planned sale to Verizon Communications Inc. ended
monthslong speculation about the internet company's future. But the
deal spawned another question: What is Marissa Mayer's next
act?
Ms. Mayer instantly became one of the most prominent chief
executives when Yahoo hired her in 2012 to revive its fortunes. Now
the 41-year-old finds herself in an unusual situation as a
relatively young veteran CEO with hard-won experience running one
of the best-known names in technology, but also with a string of
managerial missteps that critics say ultimately worsened Yahoo's
fate.
Following Monday's deal, Ms. Mayer said in an interview that she
would stay on to help integrate Yahoo with Verizon's AOL and
shepherd the sale of its stake in Alibaba Group Holding Ltd. The
Verizon-Yahoo deal is expected to close in early 2017.
"For the next six to nine months, I'm the CEO of Yahoo," Ms.
Mayer said in an interview on Monday. "I certainly plan to stay. I
wouldn't speak for Verizon , though they've told me that they too
are open-minded about it."
Few executive recruiters and Silicon Valley investors expect her
to stick around after the sale is completed. And while Ms. Mayer is
certainly young enough to lead another company, experts say it is
tough to rebound from a rookie reign many observers see as pocked
by mistakes that complicated an already-difficult turnaround.
Yahoo's revenue stalled and it failed to deliver consistent
profitability.
"It's like a pilot who flew the Hindenburg to then be asked to
fly the Goodyear Blimp during the Super Bowl," said
brand-management expert Eric Schiffer of Ms. Mayer turning CEO
again. "It won't happen in the short-term."
Another possibility is a role as an investor or adviser to
fledgling companies, some people said. Or Ms. Mayer could bring her
product expertise to an operational role at another company.
"There will be no shortage of tech startups that would love to
talk to her about having her be their CEO," said Iain Grant,
partner at executive search firm Riviera Partners. He added that
venture-capital firms in Silicon Valley would also covet Ms.
Mayer's experience.
When Ms. Mayer, an engineer whose product-design prowess was
revered at Google, came to Yahoo in 2012, the company was in bad
shape after falling well behind Google and Facebook Inc. in online
advertising.
Yahoo board members hailed her as one of the most promising
Silicon Valley executives. An employee hung up signs of her image
in the style of the iconic Barack Obama "Hope" posters. She had
immediate star power, gracing the cover of Fortune and posing for a
photo spread in Vogue.
Which made her fall from grace all the more striking. As with
her predecessor CEOs, Ms. Mayer shifted strategies and ultimately
failed to show meaningful growth in revenue. While she pared back
costs and ended dozens of products, Yahoo is left with a hodgepodge
of businesses.
"It was obviously a tough run, a tough go for anyone," said Eric
Jackson, managing director of SpringOwl Asset Management LLC and a
longtime Yahoo shareholder. "But I think she's probably had enough,
and wants to move on to the next thing."
Yahoo hasn't previously been a springboard for chief executives.
None of Ms. Mayer's last five predecessors wound up at the helm of
another public company.
Terry Semel, Jerry Yang and Carol Bartz became investors or
joined the boards of major companies. Tim Koogle, who left Yahoo in
2001, started a philanthropic group and a land-development company.
Scott Thompson, who lasted five months as Yahoo CEO, now runs a
small e-commerce company called ShopRunner Inc.
Ms. Mayer has been an angel investor in startups for years,
backing companies such as online retailer One Kings Lane and
payments startup Square Inc. She is also on the boards of Wal-Mart
Stores Inc. and fitness-tracker company Jawbone.
On the other hand, "she may be so tired and so well off" that
she doesn't work again, said Dennis Carey, a vice chairman of
recruiting firm Korn/Ferry International. Ms. Mayer has received
over $100 million in compensation during her time at Yahoo, and
stands to make about $55 million if she is terminated as part of
the sale.
Some analysts and investors say Ms. Mayer could still mount a
comeback. JMP Securities analyst Ron Josey pointed to Meg Whitman,
who ran eBay Inc. for 10 years before stepping down in 2008. Since
2011, she has been the chief executive of the larger Hewlett
Packard Enterprise Co. But those stories are rare in the corporate
world.
--Joann S. Lublin contributed to this article.
Write to Deepa Seetharaman at Deepa.Seetharaman@wsj.com
(END) Dow Jones Newswires
July 26, 2016 07:45 ET (11:45 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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