Yahoo

5 Reasons Why Mayer's Leadership Brings a New Culture at Yahoo

Today, Marissa Mayer, Yahoo's new CEO, announced two major changes to its employee policies:
  1. There will no longer be a "rest week" at the Holidays and
  2. There will be consequences if you're performing in the lower 20% of the company's internal rating system.
These are both good decisions for the company. Here's 5 reasons why:
  1. The company can't afford a "rest" period at all. It's in the midst of a major change to save its life. You don't take naps when you're doing life-saving measures.
  2. The Yahoo that Mayer is leading forgot what it takes to be successful - particularly in the tech sector. The key: You never stop acting like a start-up. Start-ups don't rest. They're too busy changing the world...and their code. 24/7/365.
  3. To succeed - no matter what the industry or sector - you have to be hungry. You have to want it. You have to be willing to sacrifice. There are no laurels to sit back on. The second you've stopped leaning forward, you're lost. So's your company.
  4. The 20% that aren't hungry don't belong in a company that is fighting for its life. Let them find other employers that aren't as concerned about complacency. They're out there. In fact, unfortunately, that's the majority of employers...which leads to the question: Are you accepting complacency in your enterprise?
  5. Because Mayer is using a like-system to Google's employee evaluation system - highly data-driven, measured, monitored and integrated by teams and functions while, ultimately, intrinsically motivated - Yahoo's employees have the opportunity to take their careers in hand...now...and make sure they're not part of that 20% to be culled. They've been given fair warning. Now it's on them.
Marissa Mayer knows what it takes to build and maintain a tech giant. After all, she was key to that occurring at Google. That's why the Yahoo Board tapped her for CEO.

Give the company a chance and watch what happens now. As long as she remains committed to the direction she's set, the culture at Yahoo is in for a big change...all for the good.

Marissa Mayer and the War on Women

There are two really popular lies about women being told today.  One is that there's no "war on women."  That all the Republican legislation that's being passed or attempted - by men - to inhibit women from living their lives the way they want...or just to be healthy...is a skewed view being perpetrated by the Democrats.

The other is that it's not because Marissa Mayer is a woman that she's getting all this attention - and insult - as the newly appointed CEO of Yahoo!  No.  From the wildly varying stories about her compensation package to that whole business about her pregnancy isn't because she's female.  It's because she's the CEO.

Hmmm.  Funny thing about both those lies.  First, they're just that: lies.  Second, they're both based on the same thing: inhibiting women from whatever form of self-determination and achievement they seek.

Most importantly, even within the legislative agenda, it's not just the men who are going after women.  It is - as usual - women, too.

I was appalled to read the comments made by a former female co-worker of Ms. Mayer's in a recent Business Insider article (written by a man) that was nothing less than an open season of personal shots.  The "source" wouldn't give her own name, of course, but she was happy to insult and demean Ms. Mayer in as many ways as she could (except about the pregnancy).

What was worse was that the things that she was complaining about would NEVER have come up were Ms. Mayer a man.  They were about her working style and power plays and management methods.  What they show is that she knows how to be a player.

So, whether you like those behaviors or not, they work.  Because the fact is, Google is, in great part, Google, because of Ms. Mayer's smarts and capability.

At least that's what everyone said right up until she became CEO of Yahoo!

For my part, I was actually proud of Yahoo's Board for selecting another woman after the Carol Bartz debacle.  It would have been very easy for them to have selected a man - simply by sheer numbers of candidates.

They didn't, though.  They chose the talent, perspective, commitment and smarts they wanted and know the company needs.

I'm all for Ms. Mayer's success - because I want Yahoo! to succeed.  And, based on the perspective of smart people like Marc Andreessen and Fred Wilson, Yahoo! is in a much better position to do so now than in years.

As for the anonymous "sources" and all the talk about "working maternity leave" and all the rest, let it go and get over it. Women and men bring their respective talents to everything they do.

For the smart people in the room, that's all that matters - and all that should.

Google, Gays and Social Responsibility

(This article was first published on Technorati.)

If you know anything about Google, you know that their hiring process is one of the most challenging on the planet.  On purpose.

They need that level of differentiation among and within their staff to make sure that they keep doing what they're doing better than anyone else.  And more besides.

Which means, from a purely pragmatic perspective, that the less they discriminate based on anything other than talent, the larger the talent pool from which they can choose and the greater their success levels will continue to be over time.

That's why the "It Gets Better" Google Chrome television ad - with its nearly 900k views on YouTube (at the time of this writing) is so indicative of Google - and such an interesting commentary on the world.



Because the company has gotten an amazing level of pushback from tens of thousands of now former Google users who are saying - specifically because of Google's support for the Lesbian/Gay/Transgender (LGBT) population - that they won't use Google as their search engine any longer.

My answer to that?  Bing and Yahoo should - faster than fast - come out with statements - or videos - in support of Google's ad.

Because "corporate social responsibility" is more than pretty words.  It's a commitment on the part of organizations to do the most they can to help and support their own people as well as society as a whole.

And now, in this economy, with corporations and their incredible cash reserves doing more to determine the future of everyone's standard of living than ever before, it is even more incumbent upon companies to fulfill that obligation.

Good for Google stepping up in support of one of the last populations in the US which is actively and legally discriminated against.

And good for you in looking at your own hiring and promotion processes - no matter where you are on this earth - to make sure your HR policies support every person of every gender, creed and more to succeed.

Because then you'll succeed even more, too.

The Dangers of China - Critical Insight from @thereformedbroker

The following piece, written by Josh Brown, is one of those periodic posts that goes beyond deserving attention.  It's a critical warning for anyone currently doing or thinking about doing business with China.

It follows in its entirety.

The Reformed Broker is a blog about financial markets and the economy. Joshua Brown is a New York City-based investment advisor for high net worth individuals, charitable foundations, retirement plans and corporations.

We are under attack.

Chinese corporate criminals and their US-based enablers are committing Capital Genocide against American investors.  We're not talking about "a few bad apples" or "a handful of exceptions", we're talking about a full-blown epidemic.  Subterfuge and malicious avarice are simply the tools of the trade when many Chinese companies do business with outsiders.

This undeniable Red Collar Crime Wave is larger in scope and financial consequence than any other international criminal enterprise in the history of the world.  We are talking about hundreds of millions of dollars, possibly billions should the Yahoo - Alibaba revelation prove itself to be a harbinger of shocks to come.

At the low end of the spectrum, corrupt representatives of sketchy or even non-existent Chinese companies are conniving their way onto US exchanges via backdoor IPOs, reverse mergers and SPACs.  They are slithering through every exchange and regulatory loophole they can find to raise money and establish their fraudulent beachheads here.  The penalties for Chinese nationals fudging numbers on a local exchange could range from exile to imprisonment to disappearance.  The penalties they face for pulling that stuff here in the US?  I don't know, a letter in the mail?  "Don't ever do it again"?

Mainland Chinese fraudsters are untouchable, they can only be barred or banned from US exchanges once caught, and so they will get away with whatever they can as long as there are investors here who are stupid enough to capitalize them.  And so the ownership of one factory in China becomes the ownership of three for the purposes of a quarterly balance sheet calculation.  The ticker symbols will be cutesy and clever while the names of the companies will almost always include the word "China".  After all, let's not forget that the name of this game is the exploitation of Americans who "want to play the growth".

It has become an absolute free-for-all.

For a nation that was so economically backwards and pathetic that it could barely feed itself 15 years ago, China's executives have certainly come a long way.  They're employing every scam and dirty trick in the book against American corporations and investors while we say thank you and send even more opportunity and cash their way.

I've held my tongue for the last 9 months, watching one scam after another appear on our exchanges.  I've said nothing as these financial landmines have been detonated beneath the feet of whichever unfortunate shareholders happened to find themselves in the wrong place at the wrong time.  No longer.

We'll limit the scope of my rage here to corporate fraud.  For the purposes of this post I'll leave out the Chinese poisoning of America-bound toothpaste, pet food and toys at their manufacturing operations.  I'll also leave out the FoxConn factory at which all the Apple products are assembled, a workplace so abusive and abhorrent that the employees must take an oath that they won't kill themselves.

But no, let's not get distracted here, we should simply focus on the accounting chicanery and falsified filings with which Chinese companies are daily relieving US investors of their capital.

The reverse mergers are by far the most insidious manifestation of the contempt that Chinese companies have for our exchanges and rules.  Working with American law firms and shameless stock promoters, these companies have found a financial engineering solution that lets them steal on our shores.  They've been able to subvert the more highly scrutinized public offering process that would normally have weeded them out.  By "cleaning up" shell companies, which should not be trading or available to begin with, the disease gets a foothold first on the pink sheets and then onto the American Stock Exchange where the real grifting can begin.

White Collar Crime columnist Walter Pavlo has collected a slew of recent examples on his blog at Forbes, including:


  • China Electric Motor – Shareholders lawsuit filed claiming underwriters violated federal securities laws by issuing materially false and misleading information.
  • China Natural Gas – Class action lawsuit alleges directors and officers issued materially false and misleading statements.  CFO of company resigned in late 2010.
  • Duoyuan Printing – SEC investigating company for fraud, NYSE delisted April 4, 2011
  • China MediaExpress Holdings, Inc. – Deloitte quit as auditor because “no longer able to rely on the representations of management”.  CFO resigned. Stock trading halted March 11
  • China Agritech – Shareholder lawsuit pending.  Dismissed its auditor Ernst & Young.
  • China Sky One Medical – Under investigation by SEC.
  • Orient Paper, Inc. – Reauditing previous financials due to license issues with previous auditor (Davis Accounting Group).

The full list is actually quite larger, it includes some of the higher profile blow-ups you may remember with stocks like RINO International and China Green Agriculture - spectacular flame-outs complete with massive insider selling prior to the denouement.

Where are the regulators, you might ask?  They are finally getting involved.  The SEC's Mary Schapiro is aware of the epidemic and is now on the case...

From Barron's:

Since March 2011 alone, she noted, more than 24 China-based companies have disclosed auditor resignations, accounting problems or both – following the auditors' inability to confirm the amounts of cash or receivables shown on the companies' balance sheets. The SEC has recently suspended trading in three Chinese businesses that "reverse-merged" into U.S.-traded shell companies.

The smarter thing to do would be to halt the entire shell company process in its entirety right this minute until we can get the rules up to a standard that will protect investors outright from these foreign liars and thieves.  Capital formation can wait fifteen minutes while we get our act together and crack down on this disgusting shell syndicate.

An even more disturbing development of late is taking place in the large cap arena, in full view of the world's media and the global investor class.  With the success of Baidu and Sina, Chinese technology companies are now finding themselves as the Belles of the Ball.  In at least one case that we are aware of, they are also finding that they can easily mislead their Western partners and shareholders.

Here in the deep end of the pool, newly-minted billionaire Chinese executives are violating contract law, globally accepted corporate best practices and fiduciary responsibility to shareholders.  They are disclosing things when and as they choose.  They are "on the level" in their own government's eyes so long as they are playing fair with their fellow Chinese investors.  This isn't a brand new phenomenon but as the companies involved get bigger, the danger grows.

This week's still-unfolding fiasco involving Yahoo being tricked out of their Alipay subsidiary by Alibaba, a company in which they hold a 43% stake, is just the latest and most outrageous example of what we're dealing with.  Here's what Jacob S. Frenkel, a former SEC enforcement lawyer who is an expert in securities law matters and a partner at Shulman Rogers in Potomac, Maryland had to say (via iChinaStock):

"Yahoo! is a victim, plain and simple.  With all the negative attention that US-listed Chinese companies, this action by Alibaba only makes worse an already difficult situation.  It creates the unfortunate appearance that executives in China may totally disregard their contractual and fiduciary obligations to shareholders.  The important message to US partners and owners is to review the effectiveness and enforceability of contracts under both US and Chinese law."

Yahoo will attempt to sue, but they have lost the asset at the end of the day, an asset whose potential was a big part of the investment thesis for the company to begin with.  US shareholders were pummeled over something that took place in secret seven months ago, escaping everyone's notice.  If major shareholders like Yahoo and Japan's Softbank can be scammed in front of everyone, what chance have any of us got?

The Red Collar crime wave is beguiling American investors both large and small.  These crooks are laughing at our securities laws and manipulating their own.  None of us are immune:

Not the savviest and most seasoned asset managers - see Glickenhaus & Co watch $4 million evaporate as China Agritech blows up.  (Bloomberg)
Not Yahoo, a player in Asian web properties since the late 90's - listen as Alipay's Jack Ma regales us with his tale of how he bitch-slapped the "declining" web portal company.  (iChinaStock)
Not even the diligent Warren Buffett can sleep soundly with his Chinese investments - see how the car company he invested in there (BYD) is essentially a counterfeiter playing games with the rules of the Chinese court system to get away with it.  (Reuters)

Can American investors trade and hold Chinese stocks?  I suppose they can...but they can also practice juggling with live hand grenades and roaring chainsaws...just because you can do something, doesn't mean you should.

I've disagreed with almost everything Donald Trump has had to say during his part-Presidential run, part final humiliation speech circuit this spring.  But where Trump and I do find common ground is in our distaste with how the Chinese do business and the lack of regard they show our companies and investors from almost every perspective.

As long as Chinese corporate officers and executives are going to blow cigarette smoke in our faces as they take advantage both here and on their home turf, I'll gladly sit out.  Until I get the sense that they have an ounce of respect for our investors, I'll watch the pickpocketing from the sidelines and focus my capital and attention elsewhere.

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Carl Icahn and Knowing When to Leave

The legendary activist investor, Carl Icahn, announced that he is leaving the Board of Yahoo! - a company that many argue his actions saved from complete demise.

You may recall the wars of the recent past when Microsoft put in a $47B bid for the whole of Yahoo! and Jerry Yang, its founder and then CEO, said no.  That's when Icahn really got going.  And that's what led to Yang stepping down, Carol Bartz coming in as Chief Executive and a search deal between Microsoft and Yahoo! finally being successfully arranged.

Now it's time for Icahn to leave.  He doesn't need to keep his seat on the Board (although there's no news about his removing his money from the company).  He did what he needed to do, has ensured that the company - and his investment - is in good hands, both in its management and Board membership, and that it has a long-term strategic pathway for ongoing success being actively executed.

Icahn is known for getting in and making waves.  What can also be learned from him is how and when to leave - especially when it is, to a great extent, you who created the success.