Yahoo, a major player in the search engine world, once made a significant business decision that would later be seen as a missed opportunity. During the 1990s, the competition among tech companies like Google, Yahoo, and Ask Jeeves was fierce.
In 1998, Google’s co-founders, Larry Page and Sergey Brin, offered to sell their nascent company to AltaVista for $1 million while they were still students at Stanford University. Their innovation, PageRank, was a revolutionary technology that assessed a page’s importance using links.
Both AltaVista and Yahoo declined the offer, believing that users would prefer Yahoo’s platform.
This decision was later regretted, and in 2002, Yahoo attempted to purchase Google for approximately $3 billion. However, Google’s founders increased their asking price to $5 billion, causing Yahoo’s then-CEO Terry Semel to withdraw from negotiations.
Today, Alphabet Inc., Google’s parent company, is one of the world’s wealthiest corporations, with a market capitalization reported to be around £2.653 trillion ($3.4 trillion) as of November.
Yahoo’s history of missed opportunities didn’t stop there. In 2008, the company rejected Microsoft’s offer to buy it for $44.6 billion.
At the time, the offer represented a 62 percent premium over Yahoo’s stock price. Microsoft aimed to create a formidable competitor to Google in the online advertising sector through a Microsoft-Yahoo partnership. However, Yahoo’s board felt the proposal undervalued their assets and potential, despite indicating they were open to further discussions. Microsoft, however, considered its initial offer “full and fair.”
Following this, Yahoo did not receive significant acquisition offers until it sold to Verizon in 2016.
Yahoo was acquired for $4.6 billion, a fraction of Microsoft’s earlier offer. This sale marked a decline from being a leading internet giant during the dotcom boom to a much-diminished enterprise in a brief period.
In 2021, Verizon sold its media assets, including Yahoo and AOL, to Apollo Global Management for $5 billion. Interestingly, the new company retained Yahoo’s historic name, signaling a possible resurgence under the familiar brand.
As of August, there are speculations that Yahoo may be among the contenders to purchase the Google Chrome web browser, indicating potential growth and new opportunities for the company.