Depends on one's goal and perspective. Finance people's goal is to squeeze money out of an investment. This is why most companies in Silicon Valley wont stay: they're built up on lies to employees and customers to eventually be sold at greater value and gutted. That was what finance wanted to do to Yahoo for a while. They also put in place one bad leader after another with a similar philosophy that damaged the company. This philosophy ignores customers and workers entirely.

My philosophy is more stakeholders than shareholders. Hers apparently was, too. It says at least make an attempt to innovate your way out of a bad situation to get a win for everyone. She tried that with an impressive effort. Ship long sailed, though, so she failed as I expected. Now, with efforts attempted, it's morally right in my model to abandon Yahoo and re-invest that capital. Workers and customers should definitely jump ship, too, if they can.

While we're at it, consider Amazon. Every piece I read for years was how they should do the same do to no or low profit. Yet, they pushed forward with growth and one innovation after another. One set of those became Amazon Web Services. A mini-revolutiom in IT followed. Would you rather they had just listen to finance people and quit long before that? What would cloud market look like?

Please don't take my comment the wrong way. I actually fully agree with everything you are saying.

I just don't think that was even possible at this stage of the game for Yahoo what with their shareholders calling for blood, their weird relationship with Alibaba such that Yahoo's corporate structure is essentially their product, management issues, lack of vision, etc.

So once something gets to that point, I'm not sure it really is possible to turn it around. So the next best thing is reallocating that capital to things that can move forward in a more productive manner.

But again, I absolutely 100% agree with "stakeholders over shareholders." Just don't think that is realistic with this particular scenario.

"Please don't take my comment the wrong way. I actually fully agree with everything you are saying."

Oh that's cool. To be clear, I wasn't taking it as anything: just an opportunity to explain what my reasoning was. Especially here, I figured there would be people on both sides I mentioned. Hence presenting it that way and being clear about my own bias.

"I just don't think that was even possible at this stage of the game for Yahoo what with their shareholders calling for blood, their weird relationship with Alibaba such that Yahoo's corporate structure is essentially their product, management issues, lack of vision, etc."

Oh yeah. I totally agree. It appeared to be beyond salvage. It's why I thought the results she got were impressive as I didn't expect it to even go that far. I might be wrong about whether it was a good move to make the attempt. It could've been foolish given how bad the situation was. I'm open to that.

I was just glad she gave a damn enough to try something rather than soak up money and gut it. It's all I see with so many tech and other companies that had a lot of untapped potential. I wasn't sure what was left for Yahoo but they had plenty of tech, smart people, & ad connections. So, I like that an effort was made which actually should've been made years ago by other management.

Meanwhile, the process of getting rid of it begins. And I still have to dig back through Yahoo email in case I missed anything important. Before they delete it...

Yeah, the "stakeholders" should get rich at the expense of the people that actually OWN the company. I'd love to see the innovation that would happen if this were implemented at scale.

>She tried with an impressive effort

That's one way to view it. I'd say it was a pretty expensive, unimpressive effort.

>rather they had listen to finance people

Uh, you realize that it's also "finance people" that have been standing behind Amazons rise as well, right? Just because you read a couple of articles on HN about activists wanting to see profits, in no way does that represent all "finance people". Amazon has a lot of shareholders. Like it or not, "finance people" aren't some homogeneous group of self interested, greedy trolls.

Yeah, the "stakeholders" should get rich at the expense of the people that actually OWN the company."

Look up Publix or Costco for an example of stakeholder model working in low margin industries. Probably could work in high margin tech.

http://www.forbes.com/sites/briansolomon/2013/07/24/the-wal-...

"That's one way to view it. I'd say it was a pretty expensive, unimpressive effort."

Feel free to offer a different set of recommendations that would've turned it around..

"Just because you read a couple of articles on HN about activists wanting to see profits"

Just discovered HN recently. Try most articles in the media and finance people they interviewed. People were either impressed with their consumer value or talking about how they were a failed business in the making. Rarely saw an exception when the name came up.

Could've been some media bias that made it appear one way while real opinion of investors was different.

I'm not sure what definition of "better" would apply but I'm certain there is a non-zero number of people who would prefer to see yahoo slowly die while paying the last of its money out to workers.

Ok, fair enough. But is there any legal framework in which that could possibly happen given shareholders and their legal interests?

I'm asking for realistic alternatives. While I appreciate the thoughtfulness of your approach, I wouldn't exactly consider that realistic.

Why would that be illegal? There is nothing illegal about having other priorities than maximizing shareholder value. See https://en.wikipedia.org/wiki/Fiduciary#Fiduciary_duties_und....

Those people should probably join a co-op or a non-profit organization then, for-profit publicly-traded corporations are not really set up for that with shareholders buying shares and firing boards and hiring new management and what not.

companies are for shareholders, not workers

That's one philosophy. The philosophy of my company is that the management team has an ethical responsibility to consider the interests of employees in strategic decision making. I am certain this is the only way to build a healthy long-lived tech company.

Exactly. And the sooner more companies' management as well as workers realize it, the better it will be for all concerned.

i think it's fair (and prudent) to consider workers in strategic vision. on the other hand, to "slowly die while paying the last of its money out to workers" is not reasonable

But to quickly die while paying out the money to owners of preferred stock is okay?

>companies are for shareholders, not workers

Companies, whether it is admitted by them or not, are really for stakeholders, not just shareholders, and stakeholders includes employees; or least, wise companies will act as if that is so, even if it is not so legally on paper.

You can also do it on paper. Make your VC shares subordinate to your employee ISO pool. Talk is cheap ;-)

Well that may be a better idea but they actually have to do it. What I meant was, if they don't behave that way, people will increasingly leave - when they can.

Have you never heard of a corporate charter? Shareholders are a component of a company, but not the reason a company exists.

Sure, so what does Yahoo's corporate by-laws or S-1 say?

The problem is that they already sold shares on the premise of being a for-profit entity extracting values to their shareholders.

They could have become an employee-owned co-op or a non-profit entity like Wikimedia or Craigslist, but at some point they chose not to.

PUBLIC companies are for shareholders, now workers. Private companies are another issue.