The Truth About Marissa Mayer: An Unauthorized Biography NICHOLAS CARLSON AUG. 24, 2013, 8:01 AM 607,217 189

Illustration by Mike Nudelman/Photo by Fortune Live Media

On the morning of Thursday, July 12, 2012, Yahoo’s interim CEO, Ross Levinsohn, still

believed he was going to be named permanent CEO of the company.

He had just one meeting to go.

That meeting was a board meeting to be held that day in a large conference room on the first

floor of Yahoo’s Sunnyvale, Calif., headquarters. Yahoo called the room “Phish Food” — a

funky room with lots of glass and white leather couches and chairs.

The agenda for the meeting: Levinsohn was going to brief the directors on his plan for Yahoo,

should he be named permanent CEO.

Levinsohn walked into the room; all of his top executives followed.

There was Jim Heckman, Levinsohn’s top dealmaker, who’d spent months negotiating a huge

deal with Microsoft. There was Shashi Seth, Yahoo’s top product management executive,

already planning a long-needed update to Yahoo Mail and the Yahoo homepage. There was

chief financial officer Tim Morse, who’d just completed a critical, company-saving deal to sell

a portion of Yahoo subsidiary Alibaba. There was Mickie Rosen, a News Corp. veteran whom

Levinsohn had hired to run Yahoo’s media business. And there was Mollie Spillman, whom

he’d just made CMO.

Heckman, Seth, Morse, Rosen, Spillman, and handful of others sat off to the side.

Ross Levinsohn

All of them believed that the meeting was a formality — that Levinsohn was going to get the

job.

They had good reason to be confident. For the two months prior, the chairman of Yahoo’s

board, Fred Amoroso, had made it clear that he was going to do everything he could to make

sure Levinsohn and his team would be running the company for the foreseeable future.

Amoroso told Levinsohn this in private. He told Yahoo employees this during an all-hands

meeting in May. He’d even joined a sales call to express support for Levinsohn to Yahoo

advertisers — an oddly hands-on move for a chairman.

In June, Amoroso helped Levinsohn recruit a high-profile Google executive named Michael

Barrett into Yahoo. During the recruiting process, Amoroso promised Barrett that

Levinsohn’s “interim” title was only temporary — that it was safe to leave Google.

Levinsohn had another reason to be hopeful: For the past few months, he’d been speaking

with two of Yahoo’s most important new directors, Dan Loeb and Michael Wolf, almost every

day. As important as it was for Levinsohn to have Amoroso’s support, he needed Loeb’s more.

Loeb ran a hedge fund called Third Point, which owned more than 5 percent of Yahoo and

had, only months before, forced the resignation of Yahoo’s previous CEO. Wolf was an

important ally for Levinsohn to have, too. Wolf, a former president of MTV, was consulting

for Third Point on media investments when Loeb asked him to join the Yahoo board and lead

its search committee for a new CEO.

Levinsohn began his presentation. It was going to be a doozy, as he planned to seriously alter

the direction of Yahoo.

He wanted it to stop competing with technology businesses like Google and Microsoft and

focus entirely on competing with media and content businesses like Disney, Time Warner,

and News Corporation. As part of this transition, Levinsohn wanted to spin off, sell, or shut

down several Yahoo business units. He said doing so would reduce Yahoo’s head count by as

many as 10,000 employees, and increase its earnings before taxes and interest by as much as

50 percent.

In fact, Levinsohn announced during his presentation that he and his team had already

started down this road.

Levinsohn told the board that, under his direction, Heckman had begun negotiating a deal

with Microsoft to exchange Yahoo’s search business for Microsoft’s portal, MSN.com, and

large payments in cash. Levinsohn and Heckman had also been talking with Google executive

Henrique De Castro about turning over some of Yahoo’s advertising inventory. There was also

talk of unloading some of Yahoo’s enterprise-facing advertising-technology businesses into a

joint venture involving New York-based ad tech startup AppNexus.

Heidi Gutman/CNBC

Dan Loeb controlled 5 percent of Yahoo and joined the board after a bloody proxy fight.

It was during this part of his presentation that Levinsohn began to feel the permanent Yahoo

CEO job slipping away.

Others in the room got the same sinking feeling.

Wolf, the man in charge of the committee tasked with hiring a permanent CEO, began to

question the wisdom of the deal.

Wolf asked, in a loud voice with a sharp tone, “I understand why this is good for Microsoft,

but why is it good for Yahoo?”

Harry Wilson, another director brought onto the board by Loeb, joined Wolf in his criticism

of the deal as “short-sighted.”

Their cross-examination of the deal eventually boiled down to one question: Had Levinsohn

and Heckman made any irreversible commitments to either Microsoft or Google?

It was obvious to several people in the room that Wolf and Wilson wanted to make sure

another candidate for the CEO job would not be forced to follow through on a deal they had

not negotiated.

This was a bad sign for Levinsohn’s candidacy.

But Wilson and Wolf’s loud complaints about the Microsoft deal weren’t the worst sign for

Levinsohn’s chances; Loeb’s behavior during the meeting was.

Loeb is the suited, slick, and handsome Wall Street type. He wears his salt-and-pepper hair

short and messy on purpose. He’s actually from Southern California, and sometimes he puts

off a surfer vibe.

During Levinsohn’s presentation, Loeb looked bored. He wasn’t paying full attention. As the

interim CEO talked, Loeb stood at the back of the room and played with his BlackBerry.

One person in the room remembers watching Loeb texting for a while and then, “during the

most important part of the presentation,” getting up and going to the bathroom for ten

minutes.

This person remembers thinking: “Oh, OK. Sorry, Ross, you’re not CEO anymore.”

After the meeting, Barrett, the Google executive Amoroso had helped Levinsohn poach, called

Levinsohn to ask how it went. Levinsohn told him he no longer felt like he was getting the job.

But who was?

That night, Levinsohn flew to Sun Valley, Idaho, where investment bank Allen & Co. holds an

annual retreat for big-name media and technology executives.

Over the weekend, Levinsohn played a guessing game with venture capitalist Marc

Andreessen, Square CEO Jack Dorsey, and Twitter CEO Dick Costolo. With each of them,

Levinsohn and the other Silicon Valley bigwigs ran through a long list of names, trying to

figure out who might be getting the job Levinsohn had so hoped for. For each name they came

up with, they came up with a persuasive reason why that person could not be it.

Whom had Wolf and Loeb so clearly already decided on?

Finally, late Sunday night, Levinsohn got a call from a friend of his at Google.

This person asked: Had Levinsohn heard that Marissa Mayer had interviewed for the Yahoo

job the Wednesday prior?

Levinsohn realized everything all at once.

Levinsohn now knew who Yahoo’s next CEO would be.

Soon, so would everyone else.

On Monday, July 16, four days after Levinsohn’s last board meeting, Yahoo made it official:

Thirty-seven-year-old Marissa Mayer was Yahoo’s new CEO.

The board had indeed already made Mayer an offer by the time Levinsohn went into that final

meeting to present his plan for Yahoo.

After the news broke in public, Levinsohn admitted to friends that he was disappointed. He

had really wanted the job, and believed he would have done very well with it. He also felt bad

for the team he put in place, who would now have to report to an unfamiliar leader.

But Levinsohn was also at peace. If he had to lose out to someone, at least he lost out to an

icon.

Flickr/Fortune Live Media

Marissa Mayer

There is no one else in the world like Marissa Mayer.

Now 38 years old, she is a wife, a mother, an engineer, and the CEO of a 30-billion-dollar

company. She is a woman in an industry dominated by men. In a world where corporations

are expected to serve shareholders before anyone else, she is obsessed with putting the

customer experience first.

Worth at least $300 million, she isn’t afraid to show off her wealth. Steve Jobs may have lived

in a small, suburban home with an apple tree out front, but Marissa Mayer lives in the

penthouse of San Francisco’s Four Seasons Hotel.

While rival CEOs like Mark Zuckerberg of Facebook and Larry Page of Google wear flip-flops,

hoodies, and T-shirts, Mayer wears Oscar De La Renta on the red carpet.

Mayer calls herself a geek, but she doesn’t look the part. With her blonde hair, blue eyes, and

glamorous style, she has Hollywood-actress good looks.

Young, powerful, rich, and brilliant, Mayer is a role model for millions of women. And yet,

unlike Facebook’s chief operating officer, Sheryl Sandberg, Mayer resists calling herself a

feminist. She even infuriated working mothers across the world when she banned Yahoo

employees from working from home.

Widely admired by the public at large, Mayer has many enemies within her industry. They

say she is robotic, stuck up, and absurd in her obsession with detail. They say her obsession

with the user experience masks a disdain for the money-making side of the technology

industry.

There is some truth to what they say.

And yet, a year after Mayer took over Yahoo, the company’s stock price was up 100 percent.

Engineers wanted to work for Yahoo again. More importantly, so did sought-after startup

CEOs like Tumblr founder David Karp, who agreed to sell his company to Yahoo for $1.1

billion.

Questions persist

Most CEOs of Mayer’s stature — people running multi-billion-dollar public companies the

size of Yahoo — are gregarious, outgoing types — the kind of person who might have been a

politician if the world of business and money hadn’t beckoned. Baby-kissers. Back-slappers.

Schmoozers. Mayer is not that type. Peers from every stage of her life — from her early

childhood days to her first year at Yahoo — say Mayer is a shy, socially awkward person.

How in the world has she overcome such a disadvantage to rise so far, so fast?

To a public casually interested in her career, Mayer’s career before Yahoo — spent entirely at

Google — is remembered as one success after another. It wasn’t.

Mayer started off at Google spectacularly well, designing its homepage, creating its product

management structure, and becoming the face of the company. She became one of the most

powerful people at one of the world’s most powerful companies.

But then, suddenly, her peers were promoted past her. Responsibility for the look and feel of

Google’s entire suite of consumer-facing products, including the Google homepage, was taken

away from her. She was moved to a less important product: Google Maps. She was removed

from a council of executives that met with Google’s CEO. To industry insiders, this sudden

change was a demotion for Mayer. Was it actually? If it was, why did it happen? How did

Mayer recover?

Mayer’s move to the top of Yahoo during the summer of 2012 was a shock for almost everyone

— including the people who convinced her to do it. How did the board pull it off?

Then there’s the biggest question about Mayer: Can she save Yahoo?

Illustration by Mike Nudelman

Marissa Ann Mayer was born on May 30, 1975 to parents Margaret Mayer, a Finnish art

teacher and homemaker, and Michael Mayer, an environmental engineer.

She grew up in Wausau, Wis., with a sports-playing brother, Mason Mayer. It was a middle-

class upbringing. She went to public schools and worked a summer job as a grocery clerk, but

her family had enough time and money to enroll her in countless activities.

Most press photos of Mayer today show her on a stage, speaking with an interviewer in front

of a large crowd or a TV audience. She’s usually wearing a designer dress — probably from

her favorite designer, Oscar De La Renta — and looking strong, confident, and in charge of

the moment.

But Mayer, now 38 years old, wasn’t always so larger-than-life. She describes the child and

teenage version of herself as “painfully shy.”

Owen Thomas, Business Insider

Yahoo CEO Marissa Mayer at the 2013 Goldman Sachs Technology and Internet

Conference.

Indeed, the Mayer you see in photos today is not the one remembered by the peers she grew

up with in the small town of Wausau. For one, her style involved more T-shirts, sweaters, and

jeans — nice clothes, but nothing flashy. And while Mayer has always presented well in front

of an audience, her peers don’t remember her as extroverted or larger-than-life.

One of those peers is named Brian Jojade. He took Advanced Math with Mayer in 8th grade.

He remembers Mayer as someone who hated social attention. Once, Jojade called the local

radio station and told them it was Mayer’s birthday. He asked the DJ to read her name out on

air. Jojade, who had a small crush on Mayer, figured hearing her name would make her laugh.

It didn’t. “She wasn’t amused at all. You could just tell it wasn’t fun for her.”

Otherwise, Jojade’s overriding memory of Mayer is as the “professional” girl who sat in the

front of the classroom and “always worked hard and made sure no matter what she was going

to do, it was going to get done right.”

Mayer’s Wausau West High School classmate Elize Bazter says she best remembers Mayer as

the girl who was “kind to everyone” but would dodge conversations on her way to go study

somewhere else.

Wausau West had a class schedule system where, instead of periods, the day was broken up

into 20-minute “mods.” Classes lasted for 40 minutes or an hour. That meant there were 20-

minute breaks during everyone’s day. Bazter said most upperclassmen would use the time to

congregate in the school’s commons.

“You could study,” says Bazter, “but mostly it was talking and eating and gathering with your

friends.”

Wausau West High Yearbook 1993

Mayer introduces the 1992 homecoming court

Not for teenage Marissa Mayer.

“She would be the person to come down, get something to eat from the kitchen or the vending

machines, and then she would go to the library or the science lab to study. She wouldn’t be

the one to stay and sit there and converse for 20 minutes.”

Bazter says the image she thinks of when she remembers Mayer is of her “in school, books in

hand, walking down the hallway to do something else.”

None of this is to say that Mayer had a sad, lonely time growing up in Wausau. She didn’t.

Mayer is fond of Wausau.

When she got married to a San Francisco banker named Zachary Bogue in 2009, she held two

ceremonies: One was in California, and a second at her childhood church, Immanuel

Lutheran in Wausau.

As a kid, Mayer’s peers in school had no idea what to make of her. Likewise, Mayer says she

was “painfully shy” around them. But teachers? Teachers were Mayer’s kind of people.

In 2010, Mayer returned to her hometown to be inducted into the Wausau School District’s

“Alumni Hall of Fame.” At a luncheon held in honor of her and 25 teachers retiring that year,

Mayer gave a speech that the school district recorded in a video.

In the video, Mayer stands at a podium in a blue designer dress with a yellow corsage pinned

on. She begins the speech by thanking her teachers, “each of whom changed my life forever.”

Then she begins to list her teachers by name. As she does — “… Mr. Freedly, Mrs. Stay, Mr.

Flanagan …” — you can see on Mayer’s face how important these people were to her growing

up. About six names in, the timbre of Mayer’s voice actually breaks toward a sob, and she has

to catch herself with a breath and a small gulp. She can’t stop her eyes from swelling with

held-back tears, though.

Most teenagers fondly recall sneaking into high school their senior year for a prank — setting

chickens loose or toilet-papering the hallways. Mayer once snuck into her AP Lit teacher’s

classroom to decorate it like a jungle because she was so inspired by the teacher’s lesson on

“Heart of Darkness.”

Mayer’s fifth-grade teacher at Stettin Elementary, Wayne Flanagan, remembers that Mayer

refused to leave his classroom the last day of that school year. She did not want to go to middle

school.

She told Flanagan she was worried that she wouldn’t make it there, with all the new kids and

teachers she’d have to meet.

Flanagan says Mayer the little girl was “a home person; she liked to be safe and know where

she’s at.”

Flanagan, who says it was obvious even then how far Mayer would go, told the reluctant little

girl, “Oh, I think you’re going to make it fine.”

Still, she wouldn’t go. Eventually Flanagan called Mayer’s mother to let her know where her

daughter was.

Certainly the people Mayer spent most of her childhood with were a particular kind of

nurturing, mentoring adult: coaches, teachers, counselors, and instructors.

As a little kid, she was in Brownies. She took piano lessons. She played volleyball and

basketball. She went to swimming and skiing lessons. She took ballet for as many as 35 hours

a week during middle school and high school. Her mother says ballet taught her “criticism

and discipline, poise and confidence.”

In high school Mayer was also on the curling team. She was a “pompom” girl and a debater.

She was on the precision dance team.

Mayer was so busy in part because her mother, Margaret Mayer, pushed her to be.

Flanagan, the fifth-grade teacher, says Mayer’s mother would frequently stop by school to

check on her daughter’s progress. He says he “got to be good friends” with the Mayers. “They

were concerned about her and that she was making the right progress. And she was. And she

knew that — that her parents were supportive of her.”

In one way, Mayer owes her career to the relationships she was able to form with teachers.

Statistics show that many high school girls do not feel like they belong in math or science

classes. In 2003, 84 percent of high schoolers who took the SAT and said they wanted to major

in computer science were boys — obviously, that means just 16 percent were women.

Wausau West High School Yearbook

Mayer was on Wausau West's state championship winning debate team.

Mayer says she never felt that bias at Wausau West.

“It wasn’t until I was a professional woman mentoring other girls in math and science that I

learned that openly liking math and science is unusual for girls. It’s actually considered far

too nerdy and far too much for the boys.

“Wausau schools were so supportive that I never felt strange for a second about pursuing

math and science and being good in them.”

Mayer credits her teachers for helping her become less shy.

They did this by showing Mayer that she could “organize” more than just her backpack, desk,

and homework — that she could organize people, as their leader.

Mayer’s childhood piano teacher, Joanne Beckman, remembers Mayer being very different

from other children in that she was someone who “watched people” in order to “figure out

why they were doing what they were doing.”

“A lot of kids that age are very interested in themselves,” Beckman says, “She was looking at

other people.”

By “looking” at her teachers, figuring out why they were doing what they were doing, Mayer

overcame her “painful” shyness with peers by taking on the teacher’s role.

Even when she was in fifth grade, Mr. Flanagan could see the pedagogical side of Mayer

developing. He thought she would become a teacher someday.

In high school, Mayer took a leadership position in every club she joined. She became

president of the Spanish club, treasurer of Key Club, and Captain of the debate team.

One of her closest friends from Wausau, Abigail Garvey Wilson, says, “When Marissa became

captain of the pompom squad, she wasn’t in with that clique of girls, but she won them over

in three ways.”

“First: sheer talent. Marissa could choreograph a great routine. Second: hard work. She

scheduled practices lasting hours to make sure everyone was synchronized. And third:

fairness. With Marissa in charge, the best dancers made the team.”

In 1993, Mayer applied to, and was accepted into, 10 schools, including Harvard, Yale, Duke,

and Northwestern.

To decide which one she would go to, Mayer created a spreadsheet, weighing variables for

each.

She picked Stanford. Her plan was to become a brain doctor — a profession that doesn’t draw

much on the leadership traits Mayer was quickly developing.

But soon enough, Mayer would find herself once again overcoming her shyness by taking

charge of a room full of peers, pushing them to work for hours.

Soon enough, she would find herself at the front of a Stanford classroom, interacting with

people in the way that came most natural to her — teaching them.

Teaching was her calling.

Illustration by Mike Nudelman

The summer before Marissa Mayer went to Stanford, she began asking herself a question that

would guide her through college and for the rest of her life.

What does Zune think?

That summer, Mayer attended the National Youth Science Camp in West Virginia. It was nerd

heaven. Picture science labs housed in wooden cabins shaded by trees. Mayer especially loved

one experiment where they mixed water and corn starch to make a sloppy goo-like substance

that seemed to defy gravity.

One day, a post-doctoral student from Yale named Zune Nguyen spoke to the campers as a

guest lecturer. He stunned all the smart kids in the room with puzzles and brainteasers. For

days, the campers couldn’t stop talking about his talk.

Finally, one of Mayer’s counselors had enough.

“You know, you have it all wrong,” the counselor said to Mayer and the campers. “It’s not what

Zune knows, it’s how Zune thinks.”

The counselor said that what made Nguyen so amazing wasn’t the facts that he knew, but

rather how he approached the world and how he thought about problems. The counselor said

the most remarkable thing about Nguyen was that you could put him in an entirely new

environment or present him with an entirely new problem, and within a matter of minutes he

would be asking the right questions and making the right observations.

From that moment on, the phrase: “It’s not what Zune knows, but how Zune thinks,” stuck

with Mayer as a sort of personal guiding proverb.

In the fall, Mayer went to Stanford and began taking pre-med classes. She planned to become

a doctor. But by the end of her freshman year, she was sick of it.

“I was just doing too many flashcards,” she says. “They were easy for me, but it was just a lot

of memorization.”

She says she wanted to find a major “that really made me think” — that would train her to

“think critically, and become a great problem-solver.” She also wanted to “study how people

think, how they reason, how they express themselves.”

“I had this nagging voice in my head saying ‘It’s not what Zune knows, but how Zune thinks.’”

Mayer began to answer the voice in her head — and find a course of study that helped her

learn how to think — when she took an introductory computer science class: CS105.

Mayer was engrossed by the challenge of programming — taking a problem and using her

mind to solve it.

During the semester, she entered a class-wide design contest for extra credit. Calling on the

same part of her brain that made her such an excellent pompom choreographer, Mayer made

a screensaver featuring exploding fireworks. In a class of 300, Mayer came in second.

The design was good enough that Mayer’s CS105 professor, Eric Roberts, would also use an

adaptation of the screen saver as an assignment for the next several years.

Stanford University

Stanford professor Eric Roberts says Mayer was an incredible teacher.

Roberts was also impressed enough with Mayer’s exploding fireworks that he invited her and

a few other top finishers over for dinner at his house. He became her mentor, as once again,

Mayer bonded with a teacher.

Mayer had also found her major.

Mayer opted for symbolic systems — a combination of disciplines straight out of Zune

Nguyen’s head: Linguistics, philosophy, cognitive psychology, and computer science classes.

Symbolic systems has become a famous Stanford major in Silicon Valley. Besides Mayer,

other alumni include LinkedIn co-founder Reid Hoffman; former senior vice president of iOS

software at Apple, Scott Forstall; and Instagram co-founder Mike Krieger.

Mayer’s teacherly leadership streak came out in a big way when she took Philosophy 160A,

then considered a “weed-out course” for prospective symbolic systems majors.

During Philosophy 160A, the students break into study groups of a half dozen or so students,

and the groups are assigned problem sets. Mayer’s group — just like all the others — put off

doing their problem sets until the day before they were due.

So that semester at Stanford was full of all-nighters for Mayer and her Philosophy 160A group.

Mayer ended up in a group that included Josh Elman, now a venture capitalist. Looking back

on those study sessions, Elman remembers “times when people in the group were bouncing

off the walls.”

He says, “Marissa was always like, ‘OK, back to work. Let’s get this done.’ She was focused on

making sure we got the right answer quickly.”

“It felt like she was the smartest student in the room — and the most serious. You always knew

those two things about her. Very smart. Very serious.”

The social dynamic of the group was typical for Mayer. As usual, she commanded the room —

organized the group’s work in an all-business fashion — but was otherwise shy, and somewhat

reclusive.

In the years ahead, this combination — Mayer’s willingness to be authoritative and

demanding the way a teacher would, with a “painful” fear or reluctance of being personal —

would cause problems for Mayer.

One Stanford classmate interpreted Mayer’s shyness as being “kind of stuck up.”

“She would do her work and then leave. When other people would stay and hang out and have

pizza, she’d just be out of there because the work is done.”

Indeed, Mayer doesn’t seem to have had a very active social life in college.

One person who lived in her dorm said she appeared to always be “down to business” and

“not much for socializing.”

“She wasn’t one of those people into making new friends around the dorm. She was always

doing something more important than just chilling.”

The simplest explanation for Mayer’s social behavior at Stanford remains that Mayer was, as

she has said many times, “painfully shy.”

Later at Stanford, Mayer found herself in a group setting that was less social, more

comfortable, and more familiar for her. As an upperclassman in symbolic systems, she was

tapped to teach a class.

She took to it naturally.

Computer science professor Eric Roberts, still Mayer’s mentor, supervised her teaching. He

says she was “unusually good at it” and “extremely effective.”

After Mayer taught a course in the spring, Roberts took a survey of her students. The results

were astounding: They loved her — even if she did sometimes talk “a mile a minute.”

Roberts asked Mayer to stick around Stanford to teach another class over the summer; she

readily agreed.

“She loved teaching,” says Roberts.

Of course she did. Stanford students called her “stuck up” when they were her classmates. But

when she was their teacher, they thought she was great.

WATCH: Marissa Mayer teaches a class at Stanford

Mayer excelled the rest of her years as an undergraduate at Stanford. After she got her

bachelor’s degree, she stayed at the school to get a master’s in computer science, with a

speciality in artificial intelligence.

As graduate school drew to a close, word got out about Mayer’s teaching ability.

She soon faced a choice.

Should she become a teacher, and step full time into a role that had always suited her so well?

Or should she challenge herself and work somewhere in the technology industry?

Taking A 2 percent Chance On Google

When people ask Mayer why she joined Google after getting her masters in symbolic systems

at Stanford, she likes to tell them her “Laura Beckman story.” It’s about the daughter of her

middle school piano teacher, Joanne Beckman.

Mayer begins: “Laura tried out for the volleyball team her junior year at high school. At the

end of the tryouts, she was given a hard choice: bench on varsity, or start on JV.

“Most people, when they’re faced with this choice, would choose to play - and they'll pick JV.

Laura did the opposite. She chose varsity, and she benched the whole season.

“But then an amazing thing happened. Senior year she tried out and she made varsity as a

starter, and all the JV starters from the previous year benched their whole senior year.

“I remember asking her: ‘How did you know to choose varsity?’

“And she said, ‘I just knew that if I got to practice with the better players every day, I would

become a much better player, even if I didn’t get to play in any of the games.’”

The moral of Mayer’s story is that it’s always better to surround yourself with the best people

so that they will challenge you and you will grow.

“My quest to find, and be surrounded by, smart people is what brought me to Google,” she

says.

And that’s the overriding reason why Mayer joined Google. But quests for self-improvement

aside, it’s also true that Mayer almost missed her chance to join the company that would make

her rich and powerful someday.

Late on a Friday in mid-April of her last year at Stanford, Mayer sat at her computer, eating

pasta and reading emails.

She already had 12 job offers to choose from, and wasn’t looking for any more hard choices.

So when yet another pitch from a recruiter popped up in her inbox, she tapped on her

keyboard’s delete key to get rid of it.

Only, she missed.

Instead of hitting delete, Mayer hit the space bar and opened the email.

That email’s subject line: “Work at Google?”

Larry Page and Sergey Brin

Mayer read the email and remembered a conversation she had with Eric Roberts who was still

a mentor years after she took his computer science class for non-majors. The prior fall,

Roberts listened to Mayer talk about the recommendation engine she’d built, and then told

her she should meet with a pair of Ph.D. students who were working on similar stuff. Their

names: Sergey Brin and Larry Page.

Mayer realized that Google was their startup. Trusting Roberts' recommendation, she replied

to an email she had meant to delete, writing that she’d like an interview.

She got one, and met with engineer Craig Silverstein. Silverstein blew her away with his

smarts. In the Laura Beckman analogy, he was varsity.

Google offered Mayer a job. She seriously considered it.

Her reservations were that she had planned on taking a job at consulting firm McKinsey,

where her clients would be Silicon Valley companies.

Google was a riskier career choice. In her typical, precise way, she’d crunched the data and

had decided that the company only had a 2 percent chance of succeeding.

Also, some small part of Mayer was worried about Google’s weird name, which she imagined

would be the punch line of family jokes for years to come.

She got over it.

“The turning point for me,” she says, “was realizing that I would learn more at Google, trying

to build a company, regardless of whether we failed or succeeded, than I would at any of the

other companies I had offers from.”

For the next 13 years, Marissa Mayer worked at Google.

Illustration by Mike Nudelman

Marissa Mayer joined Google as a programmer and rose to become the executive in charge of

the way Google search and many other popular Google products looked to Web users.

She became a senior vice president, with thousands of Google employees reporting to her and

hundreds of millions of people around the world using products she helped build. The job

made her worth hundreds of millions of dollars. But then something strange happened to

Mayer, and people in the industry wondered what went wrong.

Google

Mayer during her early Google days.

Google in its early days was a fun place to work, energized by incredible success and perks

like free food. But it was also a grinding, stressful environment.

On Mayer’s second day at Google in 1999, she went to the kitchen for a snack at around 11

A.M. There, she bumped into Larry Page, then CEO of the company. He was standing in a

corner.

“I'm hiding,” he said. “The site is down. It’s all gone horribly awry.”

He was exaggerating, of course. Google was actually doing too well at the moment.

In 1999, Google.com was a cleaner-looking and faster search engine than any of the others on

the Web, and it was rapidly taking share from older search engines like AltaVista and Lycos.

In fact, the site was down that day because Google had just signed a deal with Netscape to

handle search queries from Netscape.com. Google only had 300 computers serving search

results, and it asked Netscape to send just a fraction of its traffic. Netscape ignored the request

and sent all of its users.

Down went Google.com.

Google went back online that day, but only after hours of work from Mayer, Silverstein, and

her new colleagues. She went home at 3 a.m.

Perhaps because of long nights like that one, Mayer and Page eventually grew very close. At

one point during Mayer’s early years at Google, she and Page started dating.

Long hours would prove the norm for Mayer. During her first two years at Google, she worked

100 hours a week as a programmer.

Mayer thrived working the tough hours. She only needed four hours of sleep a night, and

when she was awake, she would work harder than anyone. She found a niche at Google:

guardian of the clean, easy-to-use look and feel of Google products. She obsessed over pixels;

their hue, shade, and placement. She co-authored a handful of patents, including an

important one for Google: “Graphical user interface for a universal search engine.”

By 2005, Mayer moved into management, overseeing the look and feel of Google’s most

important products.

She was very good at it.

Google

Mayer in 2005.

During her first several years at Google, Mayer had been able to continue teaching at Stanford.

She taught 3,000 undergraduates by the time she was promoted, so the part of managing that

has to do with leading, teaching, and organizing came easy to her. She enjoyed working with

younger Google employees so much that she even started teaching classes at Google.

She created a mentorship program called “APM” which stood for “associated product

manager.” Each year Mayer would select junior Google employees for the APM program, give

them assignments, and teach them classes. Then, at the end of the program, Mayer would

take the entire APM “class” on a weeklong trip abroad to Google offices around the globe.

When it came to developing Google products, Mayer had a bigger challenge.

Mayer has never been someone who easily relates with others. That’s why people call her

robotic or “stuck up.” This trait is why people sometimes walk out of meetings with her feeling

deeply insulted by a perceived slight.

But being in charge of how Google products should look, Mayer’s job was, basically, to relate

with Google’s millions of users. How would she do that?

In the end, it proved to be an advantage for Mayer that empathy doesn’t come naturally to

her. It forced her to be intentional about figuring out what users want and how they behave.

She came up with two clever methods of relating.

Mayer at the height of her power at Google.

The first is that she would recreate the technological circumstances of her users in her own

life. Mayer went without broadband for years in her home, refusing to install it until it was

also installed in the majority of American homes. She carried an iPhone at Google, which

makes Android phones, because so did most mobile Web users.

Mayer’s second method was to lean on data. She would track, survey, and measure every user

interaction with Google products, and then use that data to design and re-design.

Mayer’s design-by-numbers approach to product development was not always popular.

Famously, a lead designer named Doug Bowman quit Google over it.

In a farewell blog post, Bowman wrote: “… a team at Google couldn’t decide between two

blues, so they’re testing 41 shades between each blue to see which one performs better. I had

a recent debate over whether a border should be 3, 4 or 5 pixels wide, and was asked to prove

my case. I can’t operate in an environment like that. I’ve grown tired of debating such

minuscule design decisions. There are more exciting design problems in this world to tackle.”

Bowman went to Twitter.

Mayer’s obsession with data-driven design would only gain more and louder critics over the

years. But Mayer’s methods also made her one of the Internet’s most effective design and

product development leaders during her years at Google. People at Google credit her with the

success of not just Google search, but also many others, including Gmail, Google Maps, and

Google News.

Google co-founder Sergey Brin says: “Marissa makes the decisions she feels are right, and

history proves that she probably calls it right.”

San Francisco Magazine

Julian Guthrie profiled Marissa Mayer in San Francisco Magazine's March 2008 issue.

Fame and Glory As Google became a world-famous company, Mayer began to get attention from the media.

Newsweek called her one of the “10 Tech Leaders of the Future.” Business 2.0 named her to

the “Silicon Valley Dream Team.” Now-defunct technology news site Red Herring said Mayer

was one of “15 Women to Watch.”

Then, in 2004, Google went public. Its stock price soared. This made Mayer and hundreds of

her colleagues rich in an instant. The media’s fascination with Google kicked up several

notches. Mayer, in charge of the look of Google’s most important product, and a rare

photogenic woman in the technology industry, was a natural subject of the media’s fixation.

Mayer also boosted her public profile by deciding to spend her new riches conspicuously. She

bought the $5 million penthouse suite at the Four Seasons in San Francisco, and another

home closer to Google’s Mountain View campus. She started throwing fabulous parties at

both, jumping feet first into San Francisco’s high-end social scene. Guests at her homes would

see expensive original artwork from famous artists, like the 400-piece glass installation

Mayer commissioned from Dale Chihuly.

Mayer did not mind the attention. In fact, she asked Google public relations staff to get her

more of it, but in the right outlets.

Mayer’s eagerness to be known by the public may appear to contradict her claim that she

suffers from shyness. It doesn’t. She describes her shyness as a need to withdraw from social

situations almost as soon as she enters them. Being featured in a glossy magazine does not

require her to interact with every reader, so she probably doesn’t have as much anxiety about

it as she does making small talk at a party.

Plus, there is such a thing as overcompensation.

Mayer in Vogue in 2009

By the end of the decade, Vogue magazine would profile Mayer, and describe her as “the 34-

year-old mega-millionaire, Oscar de la Renta-obsessed, computer-programming Google

executive who lives in a penthouse atop the Four Seasons.”

Outside Google, her star was never brighter. Inside Google, however, where wealth was

supposed to be quietly spent, and engineers were supposed to rule, Mayer would soon be

under siege.

Demoted

At the end of 2010 and beginning of 2011, Marissa Mayer’s remarkable career suddenly lost

momentum.

First, in Oct. 2010, Mayer was removed from the top of Google’s search organization and put

in charge of Google Maps and other “local” products.

Technically, this was a lateral move, if not a promotion, because Mayer retained her vice

president title and she was, at the same time, given a seat on Google’s Operating Committee

— then CEO Eric Schmidt’s roundtable of top executives from the company.

In reality, it was a demotion. Mayer was no longer in charge of what Google’s most important

product looked like or how it worked. At Google, there is search, which generates nearly all of

the company’s revenues and profits, and then there is everything else. Running Google search,

Mayer was managing the most important product at the world’s most important Internet

company. Running Google Maps, she was not.

Still, there was the mitigating factor that Mayer was on Google’s Operating Committee, and

she therefore reported directly to CEO Eric Schmidt.

That went away too.

By Justin Sullivan/Getty Images

Google CEO Larry Page did not put Mayer on his executive team.

In December 2010, co-founder Larry Page announced that a decade after giving the CEO job

up to Eric Schmidt, he was going to take it back.

When Page formally took control of Google in April 2011, he dissolved the Operating

Committee and created a new council of executives who would report directly to him. This

group came to be known as the “L-Team.” Mayer was not named to it.

Then, to make matters worse for Mayer, Page put another Google executive, Jeff Huber, in

charge of “Geo/Local,” the group Mayer had been tasked to run only months before. Mayer

now reported to Huber, who joined Google in 2003 — four years after her.

Mayer’s loss of authority was felt across the company. One former colleague says that prior to

2010, Mayer was always able to “get what she needed” from management.

“If her boss [Google senior vice president of product] Jonathan Rosenberg didn’t approve of

something — didn’t give her head count or didn’t give her an acquisition or whatever — she’d

just go right above him and get what she needed.”

That now stopped.

“She would try to do something and HR would say that’s not the kind of thing she could do

anymore.”

“That whole paradigm broke apart.”

Another former colleague says, “When I first turned up, Marissa was very powerful at Google.

Marissa used to issue edicts and everyone did them. Over time that proved not to be so true.”

Another way to track the rise and fall of Mayer at Google is to look at the company’s own,

public list of executives in the “About Google” section of Google.com.

In November 2005, Mayer’s name and bio finally appeared on Google’s management page.

By May 2011, her name was off the site.

What happened to Marissa Mayer’s career?

One explanation is that Mayer’s career stalled as 2010 ended and 2011 began because that is

exactly when Larry Page decided he was going to become Google CEO again.

Because Mayer and Page had dated years before, some wonder if Page decided he could never

allow Mayer to report directly to him because it would be unethical or show favoritism.

Everyone at Google had long known about the relationship, and no one ever made it an issue

— it was too taboo to bring up.

One Googler explains: “Google is one of those places where, like a cult, there are things that

are OK to talk about and things that are not OK to talk about. That was one of those things

that was not OK to talk about.”

It’s actually hard to find someone at Google who was bothered by the fact that there once was

a romantic relationship between Mayer and Page.

Perhaps this is because both of them have so publicly moved on.

FameGame

Mayer and her husband, Zachary Bogue

In 2007, Page married a Stanford graduate student named Lucy Southworth. The ceremony

was on Richard Branson’s private island.

That same year, a Google colleague emailed Mayer to say: “I’m bringing a boy I think you’d

be interested in. Be cool.” The “boy” was Zachary Bogue. Tall and dark-haired, Bogue looks

like he could be the star of “The Bachelor.” He had played football at Harvard, and was now a

banker in San Francisco. In 2009, Mayer and Bogue married. Vogue covered the ceremony.

Of their married life, he says: “We continue to do work in the evening. There’s never a distinct

line between work and home. Marissa’s work is such a natural extension of her. It’s not

something she needs to shed at the end of the day.”

It’s possible that Mayer’s romantic history with Page stalled her career at Google. But that’s

not a widely held belief among Mayer’s former colleagues.

A more common explanation was that she may not have had the right kind of ambition to go

much further.

There’s a philosophy that corporations exist to benefit three constituencies: shareholders,

employees, and customers. At Google, there are two kinds of customers: the users of Google’s

services and the advertisers who pay Google to be seen by users.

Mayer spent all her years at Google worried about just half of one of those constituencies:

users.

To be fair, that was her job.

From Google’s earliest days, Mayer had always been tasked with making products that users

love. And she pursued this task with a single-minded passion, sleeping four hours a night,

working 100-hour weeks, grinding through back-to-back meetings without breaks.

But Mayer may have been a bit too single-minded in this pursuit — at least for the sake of her

future at Google.

Compared to some Google executives who joined the company around the same time as

Mayer, Mayer showed much less interest in learning about the business side of the company.

One former Google executive who worked in ad sales says, “I did not work with her, and that’s

telling.”

This executive says that even before Mayer joined Google’s Operating Committee, she had an

open invitation to join its meetings — out of respect for her importance to the company and

in an effort to develop her career. But while Mayer would always show up for meetings about

Google’s products, “she would never show up for a business review.”

Doug Edwards, Xooglers

Susan Wojcicki and Salar Kamangar during Google's early years

By contrast, two of Mayer’s peers — Susan Wojcicki and Jeff Huber — “would make the time

and be there because they were interested in expanding their horizons.”

By 2010, when Mayer’s Google career started stalling, Wojcicki and Huber were getting

promotions. Both would end up reporting directly to Larry Page. Huber would become

Mayer’s boss. Today, Wojcicki is considered one of the two or three most powerful executives

at Google.

Mayer missed several of these types of opportunities. In the months before he became CEO

again, Larry Page would hold two-hour, post-Operating Committee meetings on Mondays

that were more focused on long-term strategy.

One executive who was flattered to be invited says, “I was pretty interested in understanding

the connection between Chrome and Android.”

But Mayer would hardly ever show, “either because she was traveling or who knows.”

Several of the regular attendees at those meetings ended up with positions reporting directly

to Page.

One of them was Sundar Pichai, now leading development of both Google’s Chrome and

Android products. Pichai’s ascent had to be bittersweet to Mayer. He used to work for her,

and she had promoted him. Now he was passing her by.

Matt Rosoff

Sundar Pichai

But a former colleague says Pichai was a perfect contrast to Mayer when it came to being

involved with Google as a whole.

“Sundar would do anything to help the company. He was internally working cross-

functionally to get results. If someone was offline and didn’t get the strategy he’d sit down

with them one-on-one. He really put work into it. Marissa didn’t do that at all.”

One of Mayer’s former colleagues says she skipped all those meetings because, when it came

to the business side of Google, Mayer was always “less interested.”

“She has a disposition toward the consumer side, and users.”

This trait undoubtedly shaped Mayer’s career at Google, and it would be very important later

at Yahoo.

But more than her lack of interest in the business side of Google, and certainly more than her

history with Page, there was one overriding reason for Marissa Mayer’s sudden decline in

power.

Her great strength, her teacherly I-know-best leadership style had finally begun to grate on

people at Google. Worse, it had begun to slow the company down.

Eventually, a group of Google engineers decided to try and do something about it.

John Battelle, who has put on several large tech conferences in the Bay Area, many of them

featuring Marissa Mayer as a speaker, says of her: “I've never had a conversation with her

when she wasn’t completely certain she was right.”

This pedantic style works when you are the traffic cop in a room full of designers and product

managers, but it alienated some of Mayer’s colleagues over the years.

http://ashleyannphotography.com

Mayer and and Salar Kamangar clashed often.

One peer it irked in particular was Salar Kamangar. Now the CEO of Google-owned YouTube,

Kamangar joined Google as its ninth employee. He drafted its original business plan, and

handled financing and legal early on. Younger than Mayer, he rose along with her at Google,

though not as conspicuously.

Mayer and Kamangar clashed often.

The specific habit of Mayer’s that drove Kamangar nuts was her ability to speak incredibly

fast, not allowing him to re-enter the debate.

“In an academic situation, that’s okay because the best ideas rise and you have discussion,”

says one Googler, familiar with Kamangar’s complaints about Mayer. “But in a place where

there are personal feelings involved, if you can’t win the debate regardless of how hard you

try, because she will out-talk you, that’s a challenging situation.”

The rivalry between Mayer and Kamangar was so intense that when Kamangar was made a

vice president before her, she threatened to quit the company. She got her promotion months

later.

Another Mayer habit that annoyed colleagues was one she picked up straight from academia.

For many years at Google, Mayer insisted that if her colleagues wanted to speak with her, they

had to do so during her “office hours.” Mayer would post a spreadsheet online, and ask that

anyone who wanted to speak with her sign up for a five-minute window.

When Mayer’s “office hours” rolled around in the afternoon, a line would start to form outside

of her office and spill over into the nearby couches.

“Office hours” are socially acceptable in an academic environment because the power

dynamic is clear. The students are subordinate to the professor, usually their elder and

mentor.

But Mayer’s office hours were not just for her subordinates, but also her peers.

So there, amid the associate product managers waiting to visit with Mayer to discuss their

latest assignment or a class trip to Zurich, sat Google vice presidents — people who had been

at the company as long as Mayer, and in some cases held jobs as important as hers.

What made the “office hours” even more obnoxious for some Google engineers and product

managers was that all consumer-facing product launches or updates required Mayer’s sign-

off.

“Her weakness was an unwillingness to delegate,” says Craig Silverstein, the Google engineer

who hired Mayer years ago. “She doesn’t need any sleep. When you have four or five more

hours in the day than most people do, you don’t learn to delegate because you don’t need to.”

The team who grew most frustrated with Mayer over the “office hours” and, more generally,

the need for her to sign off on product changes, were the engineers in charge of Google search.

sigir2006

One story is that Amit Singhal told Larry Page that Mayer had to go.

Several of Mayer’s former Google colleagues confirm that among the most put off was Amit

Singhal.

While Mayer was in charge of the way Google Search looked, Singhal, was one of the engineers

in charge of creating the algorithms that actually power the search engine. After he re-wrote

Larry Page and Sergey Brin’s original code in 2001, he was named a “Google Fellow.” He’s a

big deal inside the company.

One of Mayer’s former Google colleagues says that it was actually Singhal and three other

search engineers who finally went to Larry Page and asked that Mayer be removed from the

top of Google’s search organization.

“These four guys, they were constantly being hampered. They’d say: ‘We want to roll out this

ranking change.’ Marissa’s like, ‘until I review it, you can’t launch it.’ They’re like: ‘But it’s

been three weeks.’”

Finally, says this source, Singhal and the other engineers went to Larry Page and said, “Take

your pick. Her, or us.”

In this person’s telling, Page made his choice and that’s why Mayer was moved out of search.

She had become a bottleneck.

Other people say Page removed Mayer from her perch atop search after lots of input from lots

of people.

Says one Googler: “What Larry saw as he became CEO was that Marissa has a tough user-

interface that causes problems with other stakeholders.”

Another Googler familiar with those discussions says: “Everyone agreed that something

needed to change.”

This Googler wonders if Mayer was unfairly punished in 2010 and 2011.

“Sometimes she got into trouble because she’s ambitious and a woman and that’s tough in a

man’s world. People take potshots at her because she was very young and successful. I also

think she’s young and learning and you sometimes don’t get things right.”

Another reason for Mayer’s career stall in 2011 was that Google, as a company, had grown up.

By 2010, Google had 24,000 employees. It wasn’t going to be the kind of place where, just

because an executive had been there a long time and knew the co-founders personally, she

was going to be able to get whatever she wanted.

“You couldn’t run the company like that anymore,” says one person who lived through the

transition.

“As you grow you have to hire people who have done this stuff before, and having people who

haven’t lord over them doesn’t work.”

So, by early 2011, Marissa Mayer’s progress at Google had stalled. But another, greater

opportunity was about to come her way.

Illustration by Mike Nudelman

On the afternoon of Monday, July 16, 2012, Yahoo chief revenue officer Michael Barrett stood

at a gate in New York’s JFK airport, waiting to board a plane to London.

AdMeld

Michael Barrett had only joined Yahoo weeks before Mayer.

Suddenly, his phone rang. It was a reporter. She said, “Oh my God. You have a new boss. What

do you think?”

The reporter told Barrett the news: Yahoo had a new CEO. It was Marissa Mayer from Google.

Barrett was shocked.

Barrett himself had only joined Yahoo from Google less than a month before.

Barrett’s job at Google had been a good one. He’d only left because Yahoo chairman Fred

Amoroso had told him that interim CEO Ross Levinsohn was going to get the full-time job.

As Barrett got back off the plane, he thought: What the hell happened?

- - -

The story of how Marissa Mayer came to Yahoo begins in the summer of 2011.

That’s when Dan Loeb, the manager of a hedge fund called Third Point, decided he could

make a lot of money investing in Yahoo if he could force a few people to quit its board and

install a CEO of his choosing.

There were two simple reasons Loeb believed Yahoo was a worthwhile investment, despite a

decade of mismanagement. The first was that 700 million or so people still went

to Yahoo.com every month, even though the company hadn’t come up with a cool new product

in years.

The second was that Yahoo had made a brilliant investment in two Asian Internet companies,

Alibaba and Yahoo! Japan, and Loeb did not believe this investment was being taken

advantage of by management.

So Loeb took a 5 percent stake in Yahoo and began a letter-writing, shareholder-activist

campaign to unseat its CEO and several of its board members. In his letters, Loeb accurately

pointed out that Yahoo had been mismanaged for a decade, and that it was largely the board’s

fault. In December, Yahoo’s board hoped to appease Loeb by hiring PayPal president Scott

Thompson to be Yahoo’s new CEO.

Loeb was not appeased. Publicly, he began lobbying Thompson to install new board members.

Privately, Loeb asked a consultant he’d hired, former MTV president Michael Wolf, to begin

looking for someone who could replace Thompson.

David Needleman

Dan Loeb asked Michael Wolf to find a CEO for Yahoo.

With this mission in mind, Loeb and Wolf flew to San Francisco for a series of meetings in

January 2012.

One morning during their trip, Loeb and Wolf drove south to meet with venture capitalist

Marc Andreessen for breakfast at his house. Famous for co-founding Netscape, the original

Web browser company, Andreessen had gone on to found two other billion-dollar companies

and a successful venture capital firm. By the winter of 2012, Andreessen had become Silicon

Valley’s go-to wise man.

Loeb and Wolf asked Andreessen if he’d join their slate for Yahoo’s board. He refused to

participate in a deal perceived to be hostile to Yahoo’s founders and current management, but

said he was happy to talk about Yahoo strategy.

The New Yorkers asked him: Whom should Yahoo hire: a media person or a product person?

By a “media person,” they meant an executive who could run Yahoo almost like a television

network or magazine publisher, but on the Internet. This person’s specialties would be the

ability to identify great content, close deals with the people who create it and those who could

distribute it, and the skill set to sell ads against it. CBS chief executive Les Moonves and

former News Corp chief operating officer Peter Chernin are this kind of executive. So was

Michael Eisner when he spent 20 years transforming Disney from a sleepy studio into a

corporate giant.

By a “product person,” Loeb and Wolf meant someone who could get teams of engineers and

designers to build software tools that consumers find useful, addictive, or fun. Facebook CEO

Mark Zuckerberg is this kind of executive. So was Apple co-founder, Steve Jobs.

Almost since its beginning, Yahoo had struggled with its identity.

Should it act like a “media” company — one that tries to attract consumers by producing and

buying content and distributing it through Yahoo.com? Or should Yahoo act like a “products”

company — where Internet software tools like search, Webmail, stock charts, and photo

storage attract users?

AP

Marc Andreessen

Andreessen said: If you get the chance to run Yahoo, the only way you'll be able to save it is if

you hire someone who can make great Yahoo products.

Andreessen talked about the difference between technology companies and “normal”

companies. He said the output of normal companies is their product: cars, shoes, life

insurance. In his view, the output of technologies companies is innovation. Whatever they are

selling today, they will be selling something different in five years. If they stop innovating,

they die.

Andreessen said the person at the top of Yahoo needs to know how to pioneer and produce a

steady stream of innovative products if the company was going to survive in a competition

with large companies like Google, Facebook, and Apple or even some of the Valley’s many

startups.

The message stuck.

In May 2012, Loeb finally figured out a way to get Scott Thompson out of the CEO job.

Loeb learned that Thompson had graduated from Stonehill College in 1979 with a bachelor’s

degree in accounting — not a “bachelor’s degree in accounting and computer science” as

Yahoo claimed on its website, and more importantly, in an SEC filing from April.

On May 3, Loeb drafted a letter containing this information, and sent it to the Yahoo board

and the SEC, which would publish it for the public. On May 13, Thompson resigned, citing

health issues.

Flickr/Yodel Anecdotal

Scott Thompson resigned from Yahoo after Dan Loeb revealed his bio was false.

The Yahoo board, which had hired Thompson without the help of an outside executive search

firm, also capitulated. In a legal settlement, it gave Loeb much of what he’d been asking for

since the summer before.

Five directors resigned immediately. Loeb and Wolf gained board seats, and more

importantly, the chairmanship of two important committees. Loeb would chair the board’s

transaction committee, which meant he would have sign-off power on any sale of Yahoo’s

valuable Asian assets. Wolf would lead the executive search committee, which had the

immediate task of finding Yahoo’s next CEO.

Wolf had someone in mind — just the kind of “products” CEO Andreessen had recommended.

He hired executive recruiter Jim Citrin of Spencer Stuart, and gave him a description of the

Yahoo CEO job.

The document Wolf gave Citrin said Yahoo needed to hire someone who can “modernize”

Yahoo’s “user experiences” on mobile devices by building a culture that attracts the best

“content, developer, product innovation, advertising, marketing and managerial talent.” The

document said the board sought someone who could “reestablish Yahoo!’s credibility and

reputation in the tech-innovator community” and build partnerships with companies such as

“Microsoft, Apple, Facebook, and Amazon.”

At Citrin’s first meeting with the board the week of May 21, 2012, he told the directors there

were only a few people in the industry who could do the job described in Wolf’s document.

Citrin said those people were at companies like Amazon, Apple, and Google. He said that it

was going to be very difficult for Yahoo to hire any of them.

The board came up with a list of candidates for Citrin to approach.

Though he was a “media,” not a “products” executive, the top prospect for most of the

directors was Ross Levinsohn, who became interim Yahoo CEO when Thompson stepped

down.

Levinsohn, who worked in Yahoo’s Santa Monica office, is the kind of executive who looks

like he belongs in the CEO’s office of a West Coast entertainment company. He'll point at the

camera when he’s having his picture taken. He’s got a wide smile. His hair is combed back.

He wears suits. He looks good in the fleece zip-up sweater vests they give out at Allen & Co’s

Sun Valley conference for media moguls.

Levinsohn joined Yahoo in October 2010 as an executive vice president in charge of the

“Americas” region. Levinsohn had impressed shareholders with his performance at Yahoo’s

annual shareholder meeting in 2011, when he presented a vision for Yahoo as “the world’s

premier digital media company.” For a moment, he’d ended the confusion about what kind of

company Yahoo was — a “product” company or a “media” company. To many directors, it

seemed like Levinsohn understood the value of Yahoo’s audience, and had a plan to tap it.

AP

Apple's Eddy Cue was a candidate for the Yahoo CEO job.

Among the other names were Nikesh Arora, the chief business officer at Google; Eddy Cue,

Apple’s senior vice president of Internet Software and Services; and Jason Kilar, then the CEO

of Web TV site Hulu.

The board also asked Citrin to approach Google’s Marissa Mayer.

Citrin cautioned that Mayer appeared to be a lifer at Google and was unlikely to be interested

in the job.

Many of the directors wondered whether Mayer was actually capable of leading a large public

corporation. They asked question like: Had she ever managed a balance sheet? Hadn’t she

been demoted only a year before?

Citrin said he’d call Mayer anyway.

- - -

World Economic Forum

In the middle of June 2012, Marissa Mayer sat on a plane, thinking and preparing. That

Monday, she’d gotten a call from Jim Citrin of executive search firm Spencer Stuart. He’d

been retained by Yahoo, and he had Yahoo director Michael Wolf with him.

Would she like to speak to Wolf? She would.

Now Mayer was flying to New York to have dinner at Wolf’s Manhattan apartment with Wolf,

Citrin, and three other Yahoo directors: David Kenny, John Hayes, and Thomas McInerney.

After 13 years at Google, she was surprised to find herself actually, finally, truly considering

leaving.

The past two years at Google — since she was, according to the rest of the world “demoted” —

had been quieter than the first 11, but in many ways more challenging and exciting.

In local and geo, she’d taken over a much more massive operation than the one she’d been

running at Google.

Whenever people asked her about the “demotion,” as Wolf and the other directors might over

dinner, Mayer always pointed out how she had gone from managing 250 product managers

in search to supervising a much larger, more diverse group of managers — 1,100 people

managing engineering, design, marketing, and sales. Mayer would tell people that she was

supervising some 6,000 contractors.

She’d figured out that by the fraction of the company, the geo and local piece that she was

running was something like 20-25 percent of the company’s overall headcount.

The business challenges she’d dealt with in those years had been as diverse as the types of

people she managed.

In September 2011, she went and bought Zagat for $125 million. It was not the kind of deal

someone who had been “demoted” could do. It was Google’s tenth-largest acquisition ever.

More than that, the integration of Zagat into Google search signaled a major change in

Google’s philosophy.

Previously, the company had steadfastly refused to own or produce content that would show

up in its search engine. It would just index what was already out there being created by the

rest of the world.

But after Mayer joined geo in 2010, she found that the “rest of the world” wasn’t as good at

gathering geographic data and putting it on the Web as it was creating websites for Google to

index. So she decided it was time for Google to start owning data. Her boss, Jeff Huber, and

Larry Page had backed her on the deal and the philosophical change, and now Google had lots

of content for location-based searches — a popular kind of search to do on mobile, which was

quickly becoming the future of the Internet.

Even as Mayer was on the plane, she was playing a crucial part in helping Google fend off one

of its toughest competitors in mobile: Apple. Months before, she’d noticed that Apple had

started buying companies in the mapping space. Then executive recruiters sent by Apple had

started reaching out to her people.

Obviously, they were up to something big. Mayer didn’t know — Apple would never announce

it until it was done — but she figured it planned to remove Google Maps from the iPhone and

replace it with its own Apple Maps. She’d already countered Apple’s offers by giving her

people what they really wanted. Sometimes it was raises. Sometimes it was independence.

Sometimes it was new titles. Sometimes it was actually more work, more responsibility. She

knew what her people wanted. None of her reports ended up quitting to join Apple. Now,

Mayer had her team working on a new Google Maps app for iPhone. She was confident it was

going to beat anything Apple’s people could come up with.

Mayer knew that her job switch in 2010 looked like a demotion to some people outside the

company — especially people in the media. But as she flew to New York that day in June 2012,

Marissa Mayer knew that she’d spent the previous two years learning a lot from a bigger job

than she’d ever had before.

And now she knew that she was ready for an even bigger one.

On the evening of June 24, Mayer arrived at Wolf’s modern, Fifth Avenue apartment. An

informal dinner was served.

Mayer read for the part of Yahoo CEO.

Throughout the conversation, Mayer touted a surprisingly thought-out plan for overhauling

Yahoo’s culture, executive suite, and product line-up.

After Mayer left, one of the board directors said to Citrin: “That’s the next CEO of Yahoo.” The

committee agreed that Wolf would stay in touch with her.

One of the directors noticed something funny, but decided to keep it to himself. Wolf had

served a very expensive bottle of wine, and Mayer hadn’t had a sip. Probably she was just

nervous.

Wolf wants to hire Mayer, but everyone else?

After that dinner, Wolf, the chair of Yahoo’s search committee, had decided that Marissa

Mayer should be the next CEO of Yahoo.

With her experience running cornerstone Google products like Search, Google Maps, and

Gmail, she was exactly the kind of innovative, products-oriented CEO that Silicon Valley wise

man Marc Andreessen had told him to hire back in January.

But Wolf, and his pro-Mayer allies on the board, had a problem.

By mid-June, other Yahoo directors had already all but decided that interim CEO Ross

Levinsohn should get the full-time job.

Yahoo Advertising

Ross Levinsohn and Katie Couric

When Thompson resigned in the middle of May, and Levinsohn was named interim CEO, new

chairman Fred Amoroso pulled Levinsohn aside and told him to run Yahoo like he was going

to be the full-time CEO. After that conversation, Levinsohn sent a memo to all of Yahoo’s

employees. He wrote, “I’m fired up and I hope you are too. I believe in the power of what we’re

doing. We have an incredibly talented team, unparalleled strengths in key areas and most

importantly, I see the purple pride building everywhere. Let’s move forward quickly with

conviction and confidence.”

Levinsohn ran with the opportunity, and by the end of June — really, just a few weeks — he’d

accomplished a lot. He’d signed a deal with Facebook over patents. He was able to quickly

recruit impressive executives into Yahoo, including Google advertising executive Michael

Barrett. Levinsohn and his top dealmaker, Jim Heckman, were also able to nail down several

content partnerships in just a few weeks, including one with on-demand music service

Spotify. Levinsohn and Heckman were also busy working on much larger deals with

Microsoft, Google, and a fast-growing ad tech company based in New York called AppNexus.

As Levinsohn worked hard to earn the full-time job, Yahoo directors began to come under

pressure from the rest of the industry to hand him the job. Levinsohn’s allies across the media,

advertising, and entertainment industries wrote Yahoo directors letters recommending him.

All Things D

LinkedIn CEO Jeff Weiner and cofounder Reid Hoffman lobbied for Ross Levinsohn.

At The Wall Street Journal’s D: All Things Digital conference, LinkedIn CEO Jeff Weiner and

Linkedin co-founder and venture capitalist Reid Hoffman enthusiastically endorsed

Levinsohn, and said Yahoo would finally be in good hands if it put him in charge.

After several weeks went by without Yahoo naming a full-time replacement for Thompson,

even Marc Andreessen wrote a note to Loeb suggesting that Yahoo should just put Levinsohn

in the job permanently and commit to a media strategy, since it seemed unlikely they could

get a top-end product CEO, and continued delays would permanently damage the company.

Meanwhile, All Things D reporter Kara Swisher — who had, over the years, covered Yahoo

closer than anyone thanks to board-level sources — seemed to be actively pushing for Yahoo

to hire Levinsohn. She said the only reason the board hadn’t hired him yet was that it was

looking for a “unicorn CEO — one who actually does not exist but who sounds just dreamy.”

By the beginning of July, several board members were almost completely sold. They wanted

Levinsohn to keep the job.

The top secret interviews

moooster

The Four Seasons in Palo Alto

On the morning of Wednesday, July 11, 2012, a small bus pulled in front of the Four Seasons

Hotel in East Palo Alto, California; a squat all-glass building in the middle of a parking lot

next to a highway. As the bus idled, about a dozen middle-aged executives quietly boarded.

These executives were the Yahoo board of directors, and as they boarded that bus, they had

no idea where they were going. Their destination was a secret because these people — people

who would soon have to come together and decide the fate of Yahoo — did not trust each

other.

That day, the board was going to interview, for the last time, four finalist candidates for the

Yahoo CEO job.

The search committee had decided that if the entire board knew where the final interviews

were taking place, one of the directors would inevitably leak the location to All Things D

reporter Kara Swisher. For years, the aviators-wearing, tough-talking Swisher had been

reporting Yahoo layoffs, firings, hirings, and acquisitions before they actually happened. The

new directors assumed she had a source, or sources, on the old board, and they were

determined not to provide her new ones.

Six days before, Swisher had reported, accurately, that the board was considering Hulu CEO

Jason Kilar for the job. The report had made things awkward for Kilar with Hulu’s corporate

parents, Disney and News Corporation, and he’d pulled himself out of the running — taking

a good option away from the board. Some members of the board felt Swisher had meant to

nuke Kilar in order to help Levinsohn get the job. (Swisher denies this, and there isn't any

evidence to back the allegation.)

David Kenny was particularly insistent on secrecy. The fall prior, before Scott Thompson was

hired, Kenny had interviewed for the CEO job at Yahoo. Word of his meetings in Sunnyvale

had gotten out, and Kenny had to resign from Akamai, where he was president. Kenny

recovered nicely — he’d become the CEO of The Weather Channel — but he didn’t want the

same thing happening to any of the executives interviewing that day.

The directors rode in the bus for exactly five miles — south on University, south on 101, off

the highway at Oregon Expressway, and continuing onto Page Mill road.

Google Street View

This is the secret location of the Yahoo CEO interviews

After 10 to 15 minutes, the the bus pulled into an office park, and everyone got out.

They’d arrived at the offices of Third Point’s law firm, Gibson Dunn. The location was

ostensibly picked by headhunter Jim Citrin, who’d also arranged the buses. But some of the

directors took it as a signal from the Third Point board members about whose show this really

was.

Citrin had also arranged for a car to pick up Levinsohn. He had no idea where he was going,

either. He also didn’t know who the other finalists were.

Levinsohn went first. He presented his plan, which the board was familiar with by then. He

wanted to get Yahoo out of the “platform” business, where it was competing with Google,

Microsoft, and Facebook — and move it into the content business. Levinsohn knew some of

the directors were worried that he’d ignore Yahoo’s engineers and product development

people, so he talked about how he’d been spending a lot of time with product boss Shashi Seth

and his team.

The interview felt strange to Levinsohn. He’d been talking to Loeb a handful of times, every

day. He said, “You guys know where I’m at. You know what I'm doing.”

After, Jim Citrin told Levinsohn he’d done well. Levinsohn was told that if the board decided

to go in the “media” direction, the job was his.

Levinsohn left.

After enough time had passed to ensure that they wouldn’t spot each other, Mayer arrived by

limo.

Anyone remotely familiar with her childhood, studies, and career could have predicted what

happened next.

Mayer walked into that room at Gibson Dunn and blew them away.

She described her long familiarity with Yahoo and its products. She described how Yahoo

products would evolve over time under her watch. Her presentation included an

extraordinary amount of detail on Yahoo’s search business, audience analytics, and data. She

talked about fixing Yahoo’s culture with more transparency, perks, and accountability. She

named her perceived weaknesses, and explained how she planned to address them —

including by hiring people who had the skills she didn’t have.

When Mayer was done, Jim Citrin told her he’d call her with the board’s decision by 8 p.m.

She left. The board still had a tough final decision to make.

A number of the Yahoo directors still opposed hiring Mayer. They argued that she didn’t have

enough corporate experience. Some of the directors favored Levinsohn because they felt that

the Third Point directors were just trying to install someone they could control. They had not

overlooked that the “secret” location of the final interviews had been the offices of Third

Point’s lawyers.

Intuit

Brad Smith worried Mayer didn't have enough corporate experience.

The directors who opposed Mayer — most vocally Amoroso, but also Brad Smith and David

Kenny — argued that Levinsohn, with his “media” strategy, had a better plan for Yahoo than

Mayer and her “products” strategy.

They argued that Mayer may present a greater upside — she was more likely to come up with

the next Facebook or Google Maps or Twitter — but that Levinsohn was the safer bet, a more

guaranteed return.

Loeb, who had fought a bloody fight to get onto the board, and whose vote undoubtedly

mattered the most, didn’t mind that Mayer was a high-risk, high-reward play. In his view, the

sale of Yahoo’s Asian assets and the returning of those proceeds through share buybacks or

dividends would provide enough of a “floor” in Yahoo’s value that it was worth betting on the

greater upside Mayer brought to the table.

The 8 p.m. deadline came and went. Mayer, at a dinner party on the other side of town, tried

to stop checking her phone.

At 9:45 p.m., the board still hadn’t called her. She signaled to her husband, Zachary Bogue,

that she wanted to leave the party.

Wolf lobbied his fellow directors in favor of Mayer to the point of annoyance.

Finally, the pro-Mayer directors proposed a solution. What if they made Mayer the CEO and

offered Levinsohn a huge amount of money to stay on as her COO? That way she’d be able to

pursue her “products” strategy, and he could keep running the sales force and making deals

with major media companies.

An informal vote was cast. The pro-Mayer directors were in the majority, with Amoroso and

others voting against.

It was over. A formal vote was cast.

This time the board unanimously voted to name Marissa Mayer the new CEO of Yahoo.

Meanwhile, Mayer and Bogue had decided to stay at their dinner party, but it was finally time

to go. As they began to say their goodbyes, Mayer’s phone finally rang. It was Jim Citrin. She

let it go to voicemail.

Spencer Stuart

Jim Citrin called Marissa Mayer to offer her the job.

Citrin told her: “Marissa … you should be smiling. We’re smiling. Call me ASAP.”

When the board reached Mayer to offer her the job, she did not accept it right away. First she

had some news to share.

She was five months pregnant. That’s why she hadn’t touched her wine at Michael Wolf’s

apartment the month before.

The offer stood. After three days of negotiation with Wolf, she accepted.

The morning after Mayer got the voicemail from Citrin, Levinsohn was unaware that his fate

had already been sealed. Once again he presented his plan for Yahoo to the board — this time

with his executive team there to fill in the details.

He’d woken up that morning still feeling confident that he was going to get the job. But this

was the meeting where, midway through, Loeb left to go to the bathroom and Wolf stood with

Wilson to loudly question the deals Heckman had been negotiating with Google, Microsoft,

and others.

Levinsohn went into the weekend at Allen & Co.’s mogul conference at Sun Valley sure he’d

lost the job, but unsure to whom. By Sunday, Ross Levinsohn had found out that the board

had also interviewed Marissa Mayer. When he heard her name, he knew it was over.

On Monday, Levinsohn went to work. Yahoo had to report its second quarter earnings that

week, and he worked with CFO Tim Morse’s team to prepare some remarks for the company’s

conference call with analysts. Levinsohn kept telling the team, “don’t write this for me, write

it for a CEO. It should be generic.”

When that was done, Levinsohn went back to his office to wait for the news. He’d wanted this

job. He’d fought for it. He’d done well.

Fox Business News

Fred Amoroso broke the bad news to Levinsohn.

Finally, Fred Amoroso walked into Levinsohn's office and delivered the blow.

Back in New York and barely off a British Airways plane now heading for London, Michael

Barrett joined a conference call with other top Yahoo executives.

Amoroso explained the news.

He said, “We love Ross. We thank Ross. We want him to stay. We weren’t looking for someone

like Marissa, but when she showed up, boy were we impressed.”

“Although it was a hard decision, and we think Ross is doing a great job, she brings a different

level of perspective and talent to the organization we couldn’t pass up.”

Illustration by Mike Nudelman

On Tuesday, July 17, 2012, David Filo stood waiting at the entrance of Yahoo’s headquarters

in Sunnyvale, Calif. He was very excited.

Filo is a quiet, unassuming engineer for Yahoo. He works in a cubicle. He also happens to be

a co-founder of the company.

Marissa Mayer's Flickr

Yahoo CEO Marissa Mayer and co-founder David Filo.

In 2012, Filo still owned 6 percent of Yahoo. He was its largest individual shareholder.

According to Forbes, there were only 959 people on the planet with more money than him.

And yet, the reason Filo was waiting near the entrance of Yahoo was so that when Marissa

Mayer arrived, he would be able to unfurl a long purple carpet before her feet.

Yahoo’s hero was coming. But huge challenges faced her.

Yahoo’s websites were getting fewer and fewer visitors every year. Meanwhile, Yahoo’s mobile

apps were being largely ignored.

For years, Yahoo’s most talented executives and engineers had been quitting the company to

join faster-moving rivals like Facebook and Google. Those who stayed at Yahoo tended to

show up late and leave early, or log-in from home. Mayer had to fix Yahoo’s culture.

Mayer also walked into the office that day seven months pregnant. Her new colleagues looked

to see if she was showing. They wondered how in the world she would manage a baby and the

huge job ahead of her.

The excitement was

everywhere in the building. One enthusiastic Yahoo employee had made a poster with Mayer’s

face on it in the style of Shepard Fairey’s 2008 campaign poster for Barack Obama. Across

the lower third, the poster has one word in all-caps: “HOPE.”

When she finally arrived, Mayer’s first job was to meet the one group of Yahoo employees who

were not as excited by her arrival — Yahoo’s senior executives, several of whom had risen to

their jobs thanks to Ross Levinsohn.

Levinsohn, despite personal pleas from Amoroso and whispers of a generous compensation

package, was not staying as Mayer’s chief operating officer. Since he took the interim job in

May, he’d warned the board that if he didn’t get the permanent gig, he was going to try to

become a CEO somewhere else.

If Levinsohn ever had any notion of reconsidering, that was squashed by his first scheduled

meeting with Mayer.

After he’d learned that she was getting the job, he’d flown back home to Los Angeles. When

Mayer said she wanted to meet, he agreed to fly back up to Sunnyvale. But when he showed

up at their appointed time, Mayer’s assistant told Levinsohn she was running late.

Levinsohn said to the assistant, “My office is three doors down. I'll be in there.”

Suddenly anxious, the assistant said: “You have to wait here.”

She wanted him to wait so that when Mayer was done with whatever she was doing, he would

be immediately available.

Levinsohn said, “Not so much.” He walked away.

Soon he walked out of the building for good.

Levinsohn decided that no good would come of him staying. He could see what would happen:

Yahoo would devolve into a place where there were his people and there were Mayer’s people.

The whole “media” versus “products” battle would rage on, and it would be an ugly fight.

And so, feeling that the rug had just been ripped out from underneath them, Yahoo’s senior

executives walked into Mayer’s new office at Yahoo — the one Fred Amoroso had been using

days before.

Many of these people were meeting Mayer for the first time, and they expected to sit across

from the woman they’d read about in so many fluffy profiles and had seen on TV or on stage

at conferences — someone who was charismatic and warm; personal.

That was not what they got.

TechCrunch

One by one, they walked in and sat down at a table across from Mayer. Then, she launched

into questions. She asked: “Where did you get your education?” “Where are you from?” “What

do you do here?” And so on.

As Yahoo executives answered, Mayer took notes on their answers with pen on paper, hardly

looking up.

“It kind of felt like you were summoned to the principal’s office,” says one executive who went

through one of these introductory meetings with Mayer.

“You would have thought a fair portion of [that meeting] would have been about ‘so what are

you going through? How are you feeling? Sorry about Ross. We love him. We’d like to keep

him. Realistically, he won’t stay but that doesn’t have any impact on you.’

“There wasn’t any kind of commiseration or any kind of bear hug. There wasn’t even a

question of ‘Are you in or are you out?’ It was: ‘I assume you’re in. Let me know otherwise.’

“There was no time for short conversation or human emotions. It was very boom, boom,

boom.

“Most people walked away from that meeting saying, ‘Holy shit.’”

One Yahoo executive attended such an introductory meeting between his boss and Mayer. His

boss asked Mayer “Would you like to meet the people I brought?”

Mayer looked at them.

“No.”

The truth is, the person Yahoo’s top executives sat across from in those first meetings was not

the Marissa Mayer they thought they knew from the media coverage of her. It was the Marissa

Mayer her Stanford classmate Josh Elman remembers from late night study sessions.

Just as during those all-nighters almost 20 years before, Mayer wasn’t at Yahoo to socialize.

In one early meeting Mayer said that Yahoo was going to fail — shut down — in the next few

years if it did not get things going soon. She told a top product executive that Yahoo lagged in

innovation and talent, and that its culture was broken.

She was there to save the company, and that was going to take a lot of work. It was past time

to get started.

Some of the executives Mayer met with had a hard time connecting with her. Just as some of

her Stanford study mates mistook her shyness for being “stuck up,” some of her new Yahoo

colleagues took her all-business attitude as being “demeaning.”

For the people who were making Yahoo’s products at the time, the meetings were even more

intense.

A designer or a top product manager would sit down and Mayer would assault them with a

series of questions.

“How was that researched?”

“What was the research methodology?”

“How did you back that up?”

One person who went through a Mayer grilling says, “It was scary for a lot of people because

of its intensity.”

jdlasica

Jim Heckman's and Marissa Mayer's personalities clashed.

The most pivotal meeting Mayer had in her first few days at Yahoo was with Levinsohn’s

dealmaker, Jim Heckman.

She had to learn exactly what Heckman had been negotiating with Yahoo’s competitors. She

had to decide whether or not to finalize these deals or to unwind them altogether. More

broadly, Mayer had to understand the direction Heckman and Levinsohn had been taking

Yahoo, and decide whether to keep it going that way or to slam on the brakes.

It is possible that, in the history of business, there has never been a meeting between two

people whose personalities, styles, and priorities clash more than Mayer’s and Heckman’s.

Mayer is passionate about the pixels in the picture. She’s shy. She’s careful. She’s bold, but

not reckless. She’s idealistic about people. She'll pay $60,000 to meet a designer, but wear

his dress modestly.

Jim Heckman breaks glass. He’s squinty-eyed and caffeinated. He makes deals. He uses your

first name. He quotes the comedian Daniel Tosh of Tosh.0. He doesn’t care about the

headcount; he cares about the bottom line. Once, at a Yahoo party held on a yacht during the

Cannes Lions Festival in France, Heckman brought a date who decided to go topless. There

was a lot of shouting on the yacht.

Heckman met with Mayer during her first few days at Yahoo. Heckman laid out the plan he

and Levinsohn had been working on for the past year. If implemented it would have

completely changed the way Yahoo did business.

Yahoo makes its money by selling advertising. Heckman and Levinsohn believed that Yahoo

had spent too much money and too much time trying to invent advertising technology that

would allow Yahoo to charge higher ad rates. He believed that companies like Google,

Microsoft, and AppNexus were far ahead of Yahoo in the world of ad tech, and that Yahoo was

better off partnering with one of those companies and getting rid of the people it employed to

work on ad tech.

Heckman told Mayer he believed partner ad technology would immediately raise Yahoo’s ad

rates.

Moreover, with the money Yahoo would save by getting rid of the people it had working on

ad tech, it could go out and buy high quality video content from Hollywood studios. He argued

that advertisers would be willing to pay much higher ad rates if Yahoo’s content quality were

higher. He said rates could go from under $2 per 1,000 impressions to $20.

In Heckman’s vision, Yahoo.com was more like a cable TV provider with a large, installed

audience, than it was a maker of technology products.

Microsoft

Steve Ballmer was ready to give MSN.com to Yahoo.

Heckman said he already had a deal negotiated with Google executive Henrique De Castro to

begin using Google’s advertising technology instead of Yahoo’s.

Heckman said the same theory could be applied to other second-, third-, or fourth-place

Yahoo businesses. He talked about how Boeing lets GE, Rolls-Royce, and Pratt-Whitney make

the actual engines for its airplanes.

He told Mayer that he’d negotiated a deal with Microsoft CEO Steve Ballmer, wherein Yahoo

would turn over its entire search business — patents and all — in exchange for Microsoft’s

large online media property, MSN.com, and long-term, guaranteed cash payments.

Heckman said his plan would allow Yahoo to run with just 4,000 full-time employees, far

fewer than the 15,000 full-timers and thousands more contractors Yahoo employed then. He

said Yahoo EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) would

increase by 50 percent if Mayer closed his deals.

Mayer heard him out, taking notes the whole time.

Within 24 hours, Mayer let Heckman know that she’d canceled all his deals and that his

services were no longer needed by Yahoo.

Heckman flew to Ibiza, Spain for a 30-day vacation.

Mayer began to hire her own people.

Ironically, one of her biggest hires in her first few months at Yahoo was the Google executive

Jim Heckman had been negotiating with, Henrique De Castro.

Mayer made De Castro Yahoo’s COO, and agreed to pay him as much as $62 million over four

years, not counting annual stock grants.

This hire came as a surprise to Michael Barrett, the Google executive Ross Levinsohn had

hired to run Yahoo ad sales. Though Barrett had been hired by Levinsohn, he was trying to

make a go of things at Mayer’s Yahoo.

Barrett had heard rumors that Mayer was going to hire someone to replace him, but when he

confronted her about them she said she wasn’t going to hire anyone above him, and certainly

not Henrique De Castro. She even hinted that Barrett could be Yahoo’s chief operating officer.

But then Barrett read a story on AllThingsD.com saying that De Castro had been hired.

Hurt, but politic, he called Mayer’s office intending to congratulate her on the big hire. He

wanted to begin discussing his own exit, as well.

Barrett got Mayer’s assistant.

She said, “Marissa is unavailable. I’m sure she’d love to hear from you. Could I have her call

you back?”

Barrett said fine.

Mayer called him back while he was out to dinner in San Francisco.

As he picked up the phone, he expected her to begin the conversation with an apology for

blindsiding him.

But all Mayer said was, “You called?”

Stunned that Mayer would either pretend to not know why he called or actually didn’t know

why, Barrett said, “Yeah, I just wanted to say congrats on Henrique. He sounds like a really

great hire.”

Mayer said, “I wasn’t able to tell anyone I was hiring him. I don’t think you should feel bad.”

“I don’t really feel bad at all,” he said.

The two never talked again, and Barrett left Yahoo with a severance package worth many

millions of dollars.

All Things D

Henrique De Castro's nickname is “the most interesting man in the world,” after the Dos Equis

spokesman.

De Castro has a distinct reputation among his former colleagues on the advertising side of

Google’s business. All consider him sharp and effective. But he speaks with a heavy accent, is

considered deeply pompous, and likes to speak in aphorisms. His nickname is “the most

interesting man in the world,” after the Dos Equis spokesman.

Mayer’s next most important and controversial hire was a long-time private equity investor

named Jacqueline Reses.

Though Reses had no experience in human resources, Mayer put her in charge of it at Yahoo.

Mayer hired Reses because Mayer’s plan to improve the talent level at Yahoo was to buy lots

of failed startups for small amounts of money.

Mayer believed that Reses would be expert at nailing down those kinds of transactions. She

has been. In Mayer’s first year, Yahoo bought more than 20 startups.

Steven Henry, Getty Images

Jackie Reses is Mayer's executive bagman.

Reses, a “gruff” and “matter-of-fact,” executive also served another purpose for Mayer:

executioner. In December 2012, she called up Michael Katz, a Yahoo executive based in New

York, and asked him out for a drink at a Mexican restaurant called Dos Caminos. It was a

Sunday and Katz was celebrating the second night of Hanukkah, but he figured Reses would

only ask him out at such an inconvenient time for something important. One drink in, she

fired him — just weeks before a multi-million-dollar bonus was due. (He sued.)

Mayer replaced Levinsohn’s chief marketing officer, Mollie Spillman, in August — while

Spillman was on vacation. The new CMO was Kathy Savitt, a “bubbly” and “charismatic”

executive who’d founded a startup in 2009 after running marketing for teen retail giant

American Eagle Outfitters.

After completing the sale of some Alibaba stock back to Alibaba and netting Yahoo almost $8

billion in cash, CFO Tim Morse left the company at the end of September 2012. Mayer hired

the plain-spoken Ken Goldman to replace him.

Mayer kept some of Levinsohn’s people in place during her first year. Media boss Mickie

Rosen would last until July 2013.

In the middle of all this, a baby

On Sept. 30, 2012

Mayer gave birth to a baby boy. For weeks, Mayer and Bogue called their child only “BBBB”

for “Big Baby Boy Bogue.” They would eventually name him Macallister.

Mayer’s pregnancy had been a fascination of the media, women around the world, and plenty

of her Yahoo coworkers. Everyone wondered how she would handle having a newborn while

trying to turn around a multi-billion-dollar public company.

Mayer made the baby-raising part look easy.

She took just a two-week maternity leave. Then, two months after giving birth, Mayer told the

audience at a conference on women in business: “The baby’s been way easier than everyone

made it out to be.”

What Mayer didn’t say was that, thanks to her incredible wealth and power at Yahoo, she had

a lot of help with Macallister. At home, she had a full-time staff. At Yahoo, she knocked down

a wall in her office and set up a nursery so that Macallister — and his nanny — could come to

the office with her every day.

The comments upset a lot of women. Lisa Belkin of The Huffington Post wrote an open letter

to Mayer, in which she said, “Dear Marissa Mayer … Putting ‘baby’ and ‘easy’ in the same

sentence turns you into one of those mothers we don’t like very much.”

Many of the same women would also take issue with Mayer in the spring of 2013, when she

banned employees from working from home. Working from home was a convenient way for

many of them to continue their careers after giving birth. Why was Mayer taking such a stance

against it?

Mayer hadn’t intended to make a statement. She’d only wanted more people in the office at

Yahoo. As for fighting for the working conditions of women, Mayer says that she is not a

“feminist.” She says she is “blind to gender.”

Mayer goes missing

By the middle of the fall of 2012, a camaraderie developed between all of Mayer’s direct

reports, and enthusiasm in the Yahoo workforce was swelling.

This was in part due to a series of cultural reforms Mayer brought to Yahoo almost

immediately upon her arrival.

REUTERS/Stephen Lam

She wanted to recreate the high-energy, high-productivity culture of Google’s early days,

when she had been happy working 100-hour weeks as a programmer.

She made the food free and started taking her own lunches in the employee cafeteria. She

took down cubicle walls. She joined in on email chains with lower-level employees. She

banned BlackBerrys and gave top-of-the-line company smartphones to every employee. She

created a forum where employees could complain about issues and suggest solutions. Parking

lots that had been empty until 10 a.m. and again after 4 p.m. were suddenly full from 8 a.m.

to 6:30 p.m.

On Fridays, Mayer would host a weekly meeting she called “FYI.” All Yahoo employees were

invited. She’d go over her plans for the company, that week’s “wins” for Yahoo, and answer

questions from the crowd.

Mayer dazzled. She was in her element. It was like she was back at Stanford, teaching fellow

undergraduates the material she’d just learned the year before.

“If you go to the Friday meetings, it’s like a Berkshire Hathaway annual meeting,” says one

executive who attended them.

“We would take the stage after she would open, so we were standing off the stage, watching

the audience. You should have sees the rapture in their eyes. They were like smitten teenagers.

It is unbelievable.

“She is deified. The first 50 rows are packed with the engineering team and they’re cheering

her on. There is no question that there’s a palpable level of energy and renewed enthusiasm

and renewed pride.”

Just a few weeks in, Yahoo employee morale and productivity hit a high not seen in a decade.

There was only one serious complaint from Mayer’s top executives: She never seemed to be

around when they needed her. What was she working on all the time?

Mayer demanded all of her staff across the world join the call, so executives from New York,

where it was 6 p.m., and Europe, where it was as late as midnight would dial-in too.

Inevitably, Mayer herself would show up at least 45 minutes late. Some calls started so late

that Yahoo’s executives in Europe didn’t hang up till 3 a.m. their time.

One of Mayer’s former Google colleagues says the lateness habit is something Mayer picked

up during her 13 years at Google.

Lockerz

Even executives hired by Mayer, like CMO Kathy Savitt, felt ignored by her early on.

“Eric, Larry, and Sergey were always late and causing everybody in the organization to be late.

They would hold you over, and then you would be late. And then the next meeting would start

late and then run late. And then all of the staff in that meeting would be late. It would just

trickle down through the organization. Is Marissa Mayer always late? Well, yeah. But it was

endemic to the organization.”

Mayer’s lateness was a pain, sure. But by the early fall of 2012, Mayer’s staff had grown used

to it. In fact, they were actually glad when she’d show up late to a meeting, because that meant

at least she hadn’t blown it off entirely.

Mayer had approximately 25 people reporting directly to her during her first year at Yahoo.

In theory, she was keeping up with each of them in a regularly scheduled weekly meeting. In

practice, she would go weeks without talking to people because she was so busy.

For a while, each of those 25 people thought that Mayer was just picking on them,

individually. The people who had been at Yahoo before Mayer joined assumed that this meant

she was going to fire them soon. The people Mayer had just hired into the company, including

Reses and Savitt, were even more puzzled. Why had they been hired only to be ignored?

But then, during one of those long waiting periods after 3 p.m. on a Monday, a conversation

unfurled that revealed all.

Making small talk, one executive said to another: “Did she cancel one of your one-on-ones

again?”

A third jumped in: “Oh my god, she does that to you too?”

It turned out that everyone in the room and on the call had been canceled on by Mayer,

frequently.

“Everyone assumed that they were the only one being canceled on. But then they realized that

they weren’t,” says one person who was in those meetings.

The problem with Mayer canceling her scheduled meetings with everyone is that it was

otherwise impossible to see her.

“That was your only point of contact with her. There wasn’t a lot of serendipity of bumping

into her or having her pop her head into a meeting. Getting onto her calendar was nothing

short of impossible.”

One person who kept getting blown off by Mayer remembers thinking: “I may not be you, but

I'm running a huge part of your business. I've got thousands of people reporting to me. The

chance that I would miss a meeting with my directs without an explanation is none.

“First of all, I don’t miss those meetings. Maybe it happens once in a year because of

something. But then I'm going to pick up the phone and I'm going to call them and I'm going

to apologize and I'm going to say I'm sorry, I'll make it up to you, let’s schedule some other

time. I'm not going to make them wait for more than five minutes because I know they have

incredibly important things to do. And they are human beings.”

During those staff meetings, Mayer made little time for certain topics early on — especially

those having to do with revenue, advertising technology, or distribution.

Mayer would only entertain three deals per week, and it was quickly obvious the ones she

would always prefer to talk about: anything to do with product. If Reses wanted to talk about

an aqui-hire that would bring a talented product manager into Yahoo, Mayer would prioritize

the conversation. If there was talk of a partnership with Apple on a new Weather app, that

would definitely be discussed.

There was a reason for Mayer’s lateness, for the skipped meetings, and for the priority of

product discussions during those meetings, though.

Prior to joining Yahoo, Mayer had decided the company’s many problems boiled down to one:

everything going out the front door from PR to marketing to products was flawed. In her first

months at the company, Mayer’s plan was to immediately stop that from happening ever

again.

It would take an incredible amount of time and effort. Picture a dam sprouting leaks, and

Mayer trying to plug them with all her fingers and toes.

“Who is this woman and what is she actually saying?”

A week after Mayer joined Yahoo, a Yahoo employee took a photo of one of the purple-on-

purple Marissa Mayer HOPE posters taped to the walls of Yahoo and sent it to a Google

employee named Hunter Walk.

Walk tweeted it, and soon the poster was a news story.

One of Mayer’s former subordinates from Google, Katie Jacobs Stanton, by then a vice

president at Twitter, saw the tweet, and replied to Walk in her own public tweet. She wrote:

“I hope that went through UI review :)”

The joke is a reference to the user-interface reviews that Mayer famously insisted on

conducting for every consumer-facing Web product Google launched from 2005 to 2010

before she was removed from the top of the search products organization.

Stanton was suggesting that the Mayer she knew, the one she once reported to, would soon

have strict control over all of Yahoo, and especially anything Yahoo made for the public’s

consumption.

Stanton was spot on.

Fortune Live Media

Upon taking control of Yahoo, Mayer’s first instinct was to survey and quantify everything

that Yahoo was doing that the public could see, and then start controlling it.

This applied to all areas of Yahoo, including public relations. Throughout the fall, every week,

all the Yahoo PR people had to complete a big spreadsheet with the names of every reporter

they wanted to talk to and what the business objective was. This spreadsheet was then

submitted to the head of Yahoo PR, Anne Espiritu. Espiritu would then submit the form to

Mayer. Mayer, in turn, would approve or reject every call or email and then pass the form

back down the line.

If Yahoo’s public relations staff had any complaints about these tactics, they could bring them

to Espiritu during her weekly office hours.

No group had a shorter leash than Yahoo’s largest, most important team: the hundreds of

people in charge of creating, developing, designing, and updating Yahoo products.

On Tuesday, Dec. 11, 2012, Marissa Mayer wrote a blog post announcing a new version of

Yahoo Mail for the Web, Windows 8, the iPhone, and Android.

It was a huge moment for the new Yahoo. No Yahoo product, perhaps other than the Yahoo

homepage, is as important to Yahoo as Yahoo Mail. It’s the biggest reason any of Yahoo’s 700

million users ever bother to go to Yahoo.com in the first place. And over the previous few

years, it had slowly been losing users.

“Email is the ultimate daily habit,” Mayer says in the post. “It’s often the first thing we check

in the morning and the last thing before going to bed.”

Three months before those words hit the Web, Mayer and 30 designers, product managers,

and engineers sat around a huge table in one of Yahoo’s large, traditional conference rooms.

Mayer was talking. Fast. As she spoke, two of the people seated near her typed away like crazy,

trying to take verbatim notes in Google Docs. They were struggling to keep up.

This group of people had been meeting three times a week for a month, and they’d turned the

conference room into a space that now looked more like a design studio. Windows ran down

one side of the room. On the other side, projectors hung from the ceiling, rendering screens

on the wall. Between the projections stood 20 or 30 huge pieces of foam core pinned up with

a collection of ideas about what a new Yahoo homepage and a new Yahoo email could look

like.

For the 30 people sitting around the table, their first meetings with Mayer over the past month

had been terrifying.

For years, Yahoo had been a place where the CEO was a distant figure who would meet with

various members of his or her executive leadership team to lay out broad strategies for each

function: design, technology, product, etc.

Mayer skipped all that.

“She was like ‘yeah, yeah, yeah. We'll get to that. Let’s first get some stuff out the door that

actually works,’” says a witness to those early days.

It was a level of energized scrutiny none of them were used to.

Mayer came at them with “a voracious flood of possibilities” about what the new products

could look like. Her ideas were both big and small — minute even. Mayer displayed such a

“profound capacity for detail,” that the leadership in the room finally set up the two

transcribers so that later they could “share and dissect” all of Mayer’s ideas and decisions.

One of them remembers thinking: “Who is this woman and what is she actually saying?”

But soon, as the weeks wore on, the 30 people in that room began to learn how to respond to

what Mayer was saying.

Some of the people in the room were growing frustrated with the pace, but others began

contributing. Among those who contributed, Mayer learned who to trust. Those trusted

people began to grow in confidence and they started to contribute even more.

Soon, these once-terrifying meetings became friendly, fun. Jokes started to fly around.

“It warmed up,” says someone who was in those meetings. “Once we learned how to operate

on that level of intensity with her, she softened and it became more of an interaction.”

“You’d look at her and she’s smiling!”

This was Mayer in her ultimate element.

She was pushing the pace as she had those late nights working on problems for Philosophy

160A. She was teaching, as she had 3,000 Stanford undergraduates. She was creating, as she

had those pompom routines 25 years before. She was using data to empathize with hundreds

of millions of people all at once, as she had learned to do at Google.

“I've never seen anybody like [her],” says someone from those meetings. Mayer, he says, was

“somebody who could see a whole collection of possibilities and could just talk about her

experiences and principles.”

“In that way she would start to not only share how she was thinking, but also help us learn a

lens to look through to be able to connect where she was coming from and what we were

about.”

Mayer’s intensity was

contagious. By November, the Yahoo Mail team was working nights and weekends, racing to

finish by an insane early December deadline. This was a credit to Mayer and the leader of the

Mail team, Shashi Seth, a product leader Mayer inherited.

Finally, the Mail team finished their work at the end of November. They were proud of their

work, and they deserved to be. Never had Yahoo built and launched a version of Mail so

quickly. The last time Yahoo had done it, it took 18 months to build the product and another

six months to roll it out.

But then Yahoo learned another lesson about what making products would be like with

Marissa Mayer as CEO.

One day before the new Yahoo Mail was set to launch, Mayer called a meeting with CMO

Kathy Savitt, Shashi Seth, and the entire product and engineering leadership team — about

10 people in total. They met in Phish Food, the conference room where months before, Ross

Levinsohn had pitched an alternate reality for Yahoo to a board that wasn’t really listening.

Everyone settled in; Mayer dropped a bombshell. For months, it had been decided that the

new Yahoo Mail’s colors would be blue and gray. The thought was that users were going to be

looking at Yahoo Mail on their phones all day long, and so it was best to choose the most

subtly contrasting colors possible.

Mayer wanted to change the colors entirely — from blue and gray to purple and yellow.

Seth’s body language shifted immediately. He looked deflated. He was going to have to tell

his people the news.

Changing the color of a product like Yahoo Mail sounds easy, but it’s not. Mayer’s decision

meant that some unlucky group of people were going to have to manually go and change the

color in literally thousands of places — all while working under a deadline.

Seth’s team got the changes done, but there was fallout from Mayer’s decision. The lead Yahoo

Mail designer quit and went to Google. The Yahoo Mail product manager went to Disney. The

lead engineer left and founded a startup. Seth himself left Yahoo in January 2013, a month

after Mail launched.

One person, frustrated by the incident, says he’d hoped the Yahoo Mail launch would make

people “incredibly proud of what they've accomplished” and that they would be inspired to

“stick around for years to come.”

“It was the exact opposite,” he says.

But others have a different perspective.

Their view is that Mayer refused to launch a product that she didn’t think was finished. A

product’s color may seem superficial, but Mayer is obsessed with data that shows it is not. At

Yahoo’s scale, if you can change a color a little bit and affect the performance by some factor

of .01 percent, that translates into millions of dollars.

In this view, when Mayer forced already burnt-out people to work even harder at the very last

minute to make sure a product went out as good as it could be, she set a marker for the new

era of Yahoo.

“The precedent made the next project easier to deal with,” says one person who helped launch

Yahoo Mail. “We’d gotten comfortable with what Yahoo-ness was about.”

Mayer put Adam Cahan in charge of a new group called “Mobile and Emerging Products.”

Yahoo's mobile problem When Mayer came to Yahoo in 2012, Yahoo’s mobile traffic was still tiny compared to other

big tech companies like Google and Facebook. Yahoo’s mobile apps weren’t very popular

either.

So when Mayer joined Yahoo, she knew that a top priority had to be developing mobile apps

that consumers would make a part of their daily lives.

To try to figure out what those apps should be, Mayer conducted a survey.

The results made her laugh.

She learned that after activities like calling people, texting, and maps, the main things people

do on their phones everyday are: check email, check weather, get news, get stock quotes, check

sports scores, get entertainment news, share photos, communicate with groups, and ask

questions.

What made Mayer laugh was that those are all things people go to Yahoo for on the Web.

Yahoo’s biggest products are Yahoo Mail, Yahoo News, Yahoo Finance, Yahoo Sports, and so

on.

At a speech in New York in May 2013, Mayer said: “Yahoo has had the functionality and

content people want on their phones. Now we need to get it into apps and the mobile web in

a way people can really consume it on their phones.”

In her first year at Yahoo, Mayer made two big moves to expand mobile reach and usage.

The first move was to put a Yahoo executive named Adam Cahan in charge of a new group

called “Mobile and Emerging Products.” Cahan came to Yahoo when it acquired his mobile

startup, IntoNow, for $20 million in 2011.

Yahoo lacked the mobile talent to staff such a group, so Mayer spent $200 million at the end

of 2012 and through August of 2013 acquiring more than 20 mobile startups. In almost every

case, Yahoo would shut down the startup’s product, sign its engineering and product

development people to two- and four-year contracts, and integrate them into Cahan’s team.

Mayer’s second big move to improve Yahoo’s standing in mobile would turn out to be the

biggest transaction of her entire career. It would cost Yahoo $1.1 billion.

Could Mayer close the deal?

On the evening of Thursday, May 16, 2013, 26-year-old David Karp looked at his iPhone and

saw he had a voicemail from the chief operating officer of Facebook, Sheryl Sandberg.

Screenshot/Forbes

David Karp, founder and CEO of Tumblr.

He listened to her message. All Sandberg said was that she’d like Karp to call her back.

But she had said enough.

Karp, the founder of a blog network called Tumblr, told his investment banker Jonathan

Turner at Qatalyst Partners about the voicemail.

They decided they had to call Yahoo and let them know Sandberg had called.

That day, All Things D reporter Kara Swisher and her colleague Peter Kafka had reported that

Yahoo was in serious talks to buy Tumblr.

Karp, his board, and his bankers believed Sandberg was calling to see if the report was true,

and if Facebook could possibly join the bidding for Tumblr.

On the one hand, a bidding war between Facebook and Yahoo would be great news for

Tumblr, its bankers, and its investors.

On the other, Turner was terrified that the leak would spoil their deal. Mayer was from

Google, and Google was infamous for pulling the plug on deals if it felt like the other side was

trying to gin up interest in the press. Throughout every stage of the slow courtship between

the companies, Turner had been paranoid about the press.

World Economic Forum

When Sheryl Sandberg left a voicemail on David Karp's phone, it threatened to blow up the

deal.

After originally offering only $800 million to buy Tumblr, Yahoo had finally upped its bid to

$1.1 billion and was going through the final stages of due diligence. The deal was basically

done, and the Tumblr board didn’t think it was time to get greedy.

Still, Yahoo had to be told about the voicemail. The companies had signed an “exclusivity”

agreement, which meant that Tumblr had to notify Yahoo of any other approaches.

Turner had nothing to worry about.

When Mayer found out about Sandberg’s voicemail, she only became more eager to get the

deal done.

She went to her M&A team, led by “gruff” New Yorker Jackie Reses, and told them to hurry

up and wrap things up; she didn’t want to lose out on Tumblr — not after all those months of

work and so many meetings with Karp.

Talks between the two companies had begun in November 2012, when Karp went to

Sunnyvale and met with Mayer.

By then, Tumblr, founded in 2007, had grown to an astounding 200 million worldwide users

a month, but Karp still hadn’t figured out how the blog network could make a lot of money off

all those users.

He was taking meetings on the West Coast to see if Google, Facebook, Microsoft, or Yahoo

wanted to make a strategic investment. He thought one of those companies might want to sell

ads on Tumblr.com and split the revenues.

That first meeting between Karp and Mayer left both parties cold. Mayer mostly talked about

what she was trying to do at Yahoo, and a potential deal between the two companies didn’t

really come up.

After the meeting, Karp told his board and his bankers that the new CEO of Yahoo was very

nice, but that he didn’t see a deal happening.

At investment bank Qatalyst, Turner passed the news onto his boss, legendary tech banker

Frank Quattrone.

Quattrone had gotten rich and powerful during the dot com bubble. He also got in some hot

water with the law, though he eventually extricated himself. He’s brash. He’s got a mustache.

He looks like the cartoon version of a deal-making, back-slapping, investment banker. And

yet, he’s probably the best deal-maker in the business.

Quattrone thought he would be able to get Mayer more interested in Tumblr. So, in early

2013, he met with her, and pointed out that one of Tumblr’s great strengths was how popular

it was on mobile devices. He accurately noted the incredible amount of time young people

were spending on Tumblr.

Quattrone had said the magic word: “mobile.”

Mayer said she’d take a second look.

When Marissa Mayer studies a topic, she doesn’t do it superficially. After her meeting with

Quattrone, she spent an entire weekend using Tumblr, poking around the site, and studying

metrics.

Mayer decided to get back in touch with Karp. Only, she didn’t want to do an advertising deal

or make a strategic investment. She wanted to buy his company.

If that was going to happen, it was going to take some doing. Karp didn’t want to sell his

company. Facebook and Google had started trying to talk him into it, but he refused, even

though a sale would net him more than $100 million after taxes. He wanted to keep control

over his company.

Mario Tama, Getty Images

“She really took ownership of this, really persuaded David that she would let Tumblr stay

independent.”

Mayer realized she needed to put on a full-court press.

Mayer flew to New York in February and had dinner with Karp and Jackie Reses on a Saturday

night. Mayer was able to win Karp over that night. She said that Tumblr was an excellent

product — an amazing tool for self-expression. She noted that it was beating Facebook with

younger consumers.

That Saturday night, Mayer told Karp that she had a board meeting coming up soon, and that

she’d like to bring up the possibility of buying Tumblr.

Would he be able to meet again that Sunday?

Karp agreed to meet again. That Sunday night over dinner, Mayer talked about how the new

paradigm for tech acquisitions was for the acquiring company to allow the acquired company

to continue operating independently, as a subsidiary with its own brand. She said that’s what

Google had done with YouTube, what Facebook had done with Instagram, and it’s what Yahoo

would do with Tumblr.

They stayed out till 2 a.m. Karp told Mayer to bring up the idea at her board meeting.

During her first-quarter board meeting, Mayer said she’d like to buy Tumblr. She said Tumblr

would, in a snap, improve Yahoo’s position in mobile and make its overall audience much

younger. The board gave her full support to pursue the deal.

Everything went fine from there. The All Things D report and Sandberg’s voicemail only

hurried the process along.

Finally, over the next weekend, Karp and his board accepted Yahoo’s offer.

It was a triumph for Mayer and Yahoo.

For years, Yahoo had tried to acquire hot startups that would help it become more popular

with users, and eventually begin growing its revenues again. But time and again, the

entrepreneurial ambitious types running hot startups would refuse to sell to Yahoo, preferring

to sell to Google or Facebook.

For Mayer, the deal showed how far she’d come as an executive. Her penchant for teacherly

mentoring allowed her to cultivate a relationship with Karp and close a deal that had seemed

impossible.

One source close to Tumblr’s now defunct board said he was blown away by how much effort

Mayer put into the deal.

“Where I give her high marks is that you don’t typically get CEOs that engaged.”

“She really took ownership of this, really persuaded David that she would let Tumblr stay

independent.

“She turned David around. He was very reluctant. He’s not motivated by money in the same

way as the rest of us. He’s really passionate about the product. His concern about selling to

Yahoo was that it would get subsumed.

“Marissa convinced David that this wasn’t the old Yahoo and that she’s going to run it

differently.”

Illustration by Mike Nudelman

Now into her second year as Yahoo CEO, Marissa Mayer from Wausau, Wisc., says “I’m

having the time of my life.”

A natural teacher, she has, in her 20s and 30s, turned that skill into the ability to inspire

thousands of people to make technology products that millions of people use.

The challenge she’ll face in her 40s is: Can she become the rare, complete technology CEO

who can create magical products and deliver financial results?

By one measure, Mayer did incredibly well during her first year. Since David Filo unrolled the

purple carpet for Marissa Mayer, Yahoo’s stock has gone from $15.74 per share to hovering

around $28 in August 2013.

But, while investor confidence in Mayer’s vision and performance so far certainly plays some

role in the stock’s magnificent surge, a much greater factor has been Alibaba, the Chinese

Internet company in which Yahoo is a part-owner.

Yahoo has benefitted from Alibaba in two ways.

In the months before Mayer joined Yahoo, CEO Scott Thompson and CFO Tim Morse

hammered out a deal in which Alibaba bought back a small portion of Yahoo’s stake for $7.6

billion. When he was still CEO, Thompson signaled that he would use that money to buy back

Yahoo shares, driving up their price. When she took over, Mayer went along with this plan.

Because of Alibaba, Yahoo has been able to spend billions of dollars buying its own stock.

With the supply of shares shrinking, and a few billion dollars-worth of demand in the market,

the shares have naturally risen.

The other way Alibaba has helped Yahoo shares grow in value is by growing in value itself.

Alibaba has yet to go public. Because Yahoo still owns a large stake in Alibaba, it is actually

one of the few ways investors are able to place bets on it. Those bets even have a pay-off date.

As a part of the deal Thompson and Morse negotiated, Yahoo will sell even more stock when

Alibaba does finally IPO. Some analysts think Yahoo will get another $7 billion in cash out of

that deal.

Another reason to be skeptical of Mayer’s performance is that the person more responsible

than anyone else for her being the CEO of Yahoo, Third Point’s Dan Loeb, sold off most of his

holdings in the company in July 2013. That month, he, Michael Wolf, and Harry Wilson

resigned from Yahoo’s board, as their settlement with the board required them to do if Third

Point’s stake in Yahoo ever fell below 2 percent.

Third Point remains a major Yahoo shareholder, but Loeb’s liquidation is still a strong signal

that he thinks the upside from where Yahoo is now is more limited than it was in 2012.

All that said, there is no question that Mayer has drastically improved Yahoo in her short time

there so far.

You can see it in the metrics. Yahoo claims that after Mayer’s redesigns, traffic to apps for

Yahoo Mail is up 120 percent; Yahoo Weather, 150 percent; and Yahoo News, 55 percent. In

her first year, Mayer was able to keep traffic to Yahoo Mail on the Web flat, and even slightly

grow Yahoo.com. In an age where big websites usually shrink because people check their

email and news on their phones, that’s remarkable. In the middle of August 2013, ComScore

reported that Yahoo Web properties had passed Google properties as the most popular in the

United States.

Beyond the metrics though, Mayer has revolutionized the culture at Yahoo.

One Yahoo executive told me that before Mayer arrived, “what was missing was leadership

from the very top, which was able to cut to the chase and get some tough decisions made, get

focused in the right places, get the sense of urgency, and also somebody who could really be

the chief quality control leader of the company.”

And indeed, the quality of Yahoo products has gone up since Mayer arrived. The Yahoo

Weather app that launched for iPhone in 2013 is stunning. Mayer’s redesign of Flickr is a

delight.

Yes, some people don’t get along with her because of her direct, all-business style.

Sometimes her brusque manner comes off as rude, “demeaning,” or “stuck up.” It can insult

people.

But even some of those people say Yahoo has become a far more vibrant place under her

leadership.

One person Mayer frequently clashed with at Yahoo told me, “You have to give Marissa a lot

of credit. Just because I don’t like what she’s done to me and I don’t like what she’s done to

many other people, doesn’t mean I'm going to shy away from giving her credit. She brought

life back to Yahoo. There’s no question about it.

“The Friday before she came on, the parking lots would be empty till 10 a.m. and would be

empty again after 4 p.m. That happened day after day after day for seven months in a row.

Marissa comes, the next week, the parking lots are full at 8 a.m. and people are still there at

6:30.

“The changes that she brought — making food free, focusing on quality, shutting some things

down, being open and honest during the Friday FYI meetings — all brought belief back for a

lot of people.”

“If she hadn’t come in, all the smart people would have left.

“And that would have been the end of Yahoo.”

═══

A note on sources

═══

This story is based primarily on first-hand reporting consisting of dozens of interviews.

This story would not exist if not for the cooperation of many people who did speak with me,

including those who grew up with Mayer, taught her, or worked with her at Google and Yahoo.

Some of these people are or were employed at Yahoo and spoke to me at the risk of their

careers. Many of these people spoke on a not-for-attribution basis. Some spoke on the record.

I have not identified many on-the-record sources because I did not want to allow for the

process of elimination to identify others.

This story, being told in a narrative fashion, does not identify the sources of information for

particular facts, including thoughts. I would caution readers against assuming that because I

have reported a person’s thoughts, that person is a direct source. A person will often share

thoughts about pivotal moments in their lives with a large group of people.

As a part of the narrative, my story includes dialogue.

I am grateful to James B. Stewart’s “note on sources” at the end of his book, “DisneyWar.”

That note helped me think about how to describe my own sourcing. In his note, Stewart

describes how he sources dialogue. It’s a perfect explanation, and I’d like to quote it and use

it as my own explanation.

“As part of the narrative, I have included passages of dialogue. Dialogue— what words were

said— is a fact like any other. It is not necessarily a quotation from an interview with me and

I would discourage readers from inferring that one or both of the speakers is a direct source.

Especially in today’s world of instant communication, it is sometimes amazing how many

people turn out to be privy to what others may assume is a private conversation. Many of the

conversations reported in this book either took place before an audience or became known to

a wide circle of people, often within minutes of their taking place. … In a few cases other

people were listening in on speakerphones, extensions, or overheard conversations without

one or both of the speakers’ knowledge. Readers should bear in mind that, given the vagaries

of human memory, remembered dialogue is rarely the same as actual recordings and

transcripts. At the same time, it is no more nor less accurate than many other recollections.”

═══

Bibliography

═══

Guthrie, Julian. "The Adventures of Marissa." San Francisco. Feb. 8, 2008.

Guynn, Jessica. "How I Made It: Marissa Mayer, Google's champion of innovation and

design." Los Angeles Times. Jan. 2, 2011.

Holson, Laura M. "Putting a Bolder Face on Google." The New York Times. February 28,

2009.

Marissa Mayer's IIT commencement address. YouTube.

Weisberg, Jacob. "Yahoo's Marissa Mayer: Hail to the Chief." Vogue. September 2013.

Sellers, Patricia. "New Yahoo CEO Mayer is pregnant." Fortune. July 16, 2012.

Sellers, Patricia. "Marissa Mayer: Ready to rumble at Yahoo." Fortune. October 11, 2012.

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Acknowledgments

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I'm grateful to Jay Yarow and Alyson Shontell for reading this story and suggesting edits. Jill

Klausen and Liz Wilke saved me with wonderful copy edits. Mike Nudelman contributed

excellent illustrations that bring the story to life. I'm grateful to people in California,

Wisconsin, and around the world who took my calls and agreed to talk.