Yahoo: The Internet Giant That Turned Down Google (Twice), And Still Won’t Die

Today, I was reading an interview that Yahoo’s CEO Jim Lanzone gave to Fortune Magazine today and I could not help it as the memories came rushing back.

For people of my generation, in the swirling chaos of the early internet, when dial-up screeches were the soundtrack of digital hope, Yahoo was the internet for millions. For us kids who typed yahoo.com before we knew what “URL” even meant, the purple exclamation mark was a promise that we could search, read the news, chat with strangers, and sign up for your first email address, all in one place. I can never forget the thousands of naira someone like Segun Babatunde made opening emails for people.

But for those who have followed the Yahoo story, it is also something else: a cautionary tale told in Silicon Valley conference rooms, and MBA classes around the world. After all, this was the giant that turned down a chance to buy Google. Twice.

So, it was 1994 and Jerry Yang and David Filo were two Stanford grad students building a humble “guide to the World Wide Web.” They called it “Jerry and David’s Guide to the World Wide Web”. They wisely changed it to Yahoo!, short for “Yet Another Hierarchical Officious Oracle.” By 1996, Yahoo went public, its IPO raising $33.8 million. As recounted in Alexandra Wolfe’s book “The Valley of the Gods: A Silicon Valley Story”, Yahoo was one of the first great dot-com darlings.

In the late ’90s, Yahoo was unstoppable. It was the gateway to the internet before Google or even a company you might not know called MySpace. You didn’t just search on Yahoo, you checked your horoscope, joined Yahoo Groups, played fantasy sports, and organized your chaotic Hotmail inbox.

At its peak, Yahoo was worth $125 billion, more than Disney or General Motors at the time. It was the web’s front door.

In 1998, two scruffy Stanford PhD students, Larry Page and Sergey Brin, approached Yahoo’s leadership with a proposition: buy our fledgling search engine project, Google, for about $1 million, and we can go do other things with our lives. Yahoo politely declined. The thinking was that the web portal model was thriving, so why dilute it with better search?

A few years later, Yahoo tried to course-correct, offering to buy Google for $3 billion. By then, Page and Brin said it was too small, and asked them to add $2 billion to their offer. Yahoo balked. The rest, as they say, is history.

In a single misstep, Yahoo let slip what would become one of the most powerful companies on Earth. Not once, but twice.

Yahoo didn’t just fumble Google. It made a habit of half-steps and missed leaps. It bought GeoCities for $3.6 billion, only to shut it down years later. It snapped up Tumblr for $1.1 billion, then wrote down its value by nearly the same amount.

Meanwhile, as Google redefined search and Facebook cornered social, Yahoo struggled to define itself. No one was really sure what Yahoo was. Was it a media company? A tech company? An advertising firm? A search engine? It tried to be everything. And in the hyper-competitive web economy, as Jeff Bezos of Amazon would later say, “everything” is often “nothing.”

Yet even as Yahoo’s market value plummeted, it clung to life. Partly because, for millions around the world, Yahoo Mail remains the address they won’t give up. By 2022, Yahoo Mail still had an estimated 225 million active users, an odd little fortress of internet nostalgia and stubborn loyalty.

In 2017, after years of corporate drama, Verizon bought Yahoo’s core assets for $4.48 billion. For perspective, that’s less than what Yahoo once offered to buy Facebook for in 2006, an offer Mark Zuckerberg famously rejected.

Yahoo was folded into “Oath,” then “Verizon Media.” In 2021, Verizon sold Yahoo and AOL to Apollo Global Management for $5 billion. And somehow, Yahoo began making money again, quietly turning its vast user base into an ad business. It leaned into its biggest asset: all that data from millions of mailboxes and fantasy leagues.

So what is Yahoo now? An advertising business. A news aggregator. A search engine. A sports and finance portal. A survivor.

It’s not sexy like Google or TikTok. It won’t be listed next to OpenAI in breathless tech think pieces. But it’s proof that on the internet, extinction isn’t always guaranteed. Sometimes it’s enough to linger in people’s bookmarks and muscle memory.

In 2022, Yahoo even bought back its small slice of the search business, reclaiming what was once its crown jewel. Now it’s rebuilding Yahoo News, a feature I enjoy a lot, and Yahoo Sports as digital brands with surprising loyalty. Some analysts whisper it could become a player in the new privacy-first ad era.

One big reason for this renewed optimism is CEO Jim Lanzone, who’s become almost as ubiquitous these days as the 30-year-old brand he was hired to revive nearly four years ago. Maybe that’s because he finally has something to talk about. While the Apollo-owned Yahoo doesn’t disclose revenue numbers, it’s trending up on metrics like monthly users, search traffic, and engagement.

Lanzone isn’t new to digital revivals. He’s credited with boosting brands like Tinder, CBS Interactive, Clicker Media, and Ask.com. His leadership style borrows from stories of stubborn comebacks. “The book that I go back to is Shoe Dog by Phil Knight,” he says. “If anyone wants to think that Nike happened overnight or they were just brand geniuses — it took years of building that company.”

He draws inspiration from the revival of another classic — New Balance — in plotting where Yahoo could go. “There’s no reason, if our products are great, that we couldn’t do the same thing,” Lanzone says. “I hope we can get the brand back on the map in a way where we reward that kind of latent love that I think always has been out there across generations. Maybe it’s a bit of a modern, vintage brand if you are younger.”

Yahoo will forever be the company that almost bought Google. The company that almost bought Facebook. The company that almost kept its crown. But it’s also the company that helped the world’s first billion people get online. The portal that taught kids to search and grandparents to email.

That purple exclamation point is the story of the web itself: chaotic, promising, disappointing, and impossibly resilient.