The impending Age Of Abundance was prophecied in the scriptures thousands of years ago.
Monday, December 22, 2014
Sunday, December 21, 2014
Betting On Jack Ma: Jerry Yang's Master Stroke
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| Jack Ma, Founder of Alibaba Group (Photo credit: Wikipedia) |
Finding Alibaba: How Jerry Yang Made The Most Lucrative Bet In Silicon Valley History
Yahoo’s board agreed to sell 523 million Alibaba shares, half of its stake, back to Alibaba at $13 apiece. Yang hadn’t been so keen to sell. They did anyway. By then he’d quit the board. Sure enough, Alibaba’s IPO last month rocked global markets. Shares of the Chinese e-commerce giant are now worth around $90. Yahoo still has a 16% stake worth $36 billion, but it left almost as much money on the table–some $35.5 billion–as its entire current market capitalization. ....... When the official history of Silicon Valley is (re)written, it will be hard to judge which of Yang’s achievements is bigger: starting Yahoo or betting early on Jack Ma, chairman and CEO of Alibaba. ....... Nine years ago, before Yang was CEO of Yahoo, he spent $1 billion of Yahoo’s money for 30% of Ma’s company. He knew the asset would be hugely valuable someday and refused to sell Yahoo to Microsoft when Steve Ballmer came calling in 2008, a decision that cost him his CEO job. Yahoo’s current CEO, Marissa Mayer, can do whatever she wants to put a better face on things, but Wall Street has marked her business down to zero. It’s now a proxy for Alibaba, and that was all Yang’s doing. ...... guess who’s getting a seat on Alibaba’s board post-IPO: nobody affiliated with Yahoo except Yang. His clear-eyed and early confidence in Alibaba has brought a whole new appreciation to his role as Silicon Valley’s new East-West power broker..... Yang has deep ties in Asian tech circles and will be there to point Jack Ma and the others in the right direction. ..... Earlier this year Tango, a messaging-app firm in Mountain View, Calif., took on $215 million from Alibaba at a $1 billion valuation, a deal that Yang helped along through his connections to Jack Ma’s deputy. ..... His new role of superangel offers a chance to shed his reputation as a bounced-out business mogul. Under his watch Yahoo steadily lost search and advertising share to Google. It also let Facebook slip through its fingers in 2006 by dithering over a $1 billion price tag. .... “I wanted to get back to being close to entrepreneurs,” says Yang, sipping Taiwanese green tea and ignoring his smartphone for an hour straight. ..... Yahoo’s fortuitous connection with Alibaba would never have happened if a Japanese telecom billionaire named Masayoshi Son hadn’t made a detour to Mountain View in 1995 to sit down with the young Yang and Filo. ..... The next day Son went to Mountain View and had take-out pizza and sodas with the young Yahoo founders. SoftBank invested $2 million for a 5% stake in Yahoo, putting in another $105 million in 1996 and then another $250 million in 1998 to take as much as 37% of the company at one point. ...... While Yahoo Japan began gaining millions of customers, Yang took his first trip to China in 1997. A junior staffer in the economic ministry was assigned to take Yang on a tour of the Great Wall of China. His name was Jack Ma, a former English teacher who had tried and failed to start a Chinese version of the Yellow Pages. ..... “Jack was one of the first people I ever met [in China],” Yang says. ........ Along the hike the two hit it off and talked about the growth of the Web. “He was very curious about what it’s like on the Internet and what the future might be.” Several months later Ma began building another startup based on grand and rather vague plans to connect Chinese companies with the rest of the world. He called it Alibaba. ...... BY THE SPRING OF 1999, the height of the dot-com bubble, Yahoo had bloomed into one of the most popular websites on Earth, and Son was briefly almost as rich as Bill Gates. Ma’s Alibaba outfit was piddling by comparison, just a handful of people working out of his apartment in Hangzhou. ........ But Son found him during his periodic hunts for new investments. After visiting Ma for the first time, Son recalled that he liked “the look in [Ma's] eye” and his “animal smell. It was the same when we invested in Yahoo, when they were still only five or six people.” Son put $20 million into Alibaba, before eventually amassing a 37% stake in the company, even as the dot-com crash wiped 99% off of SoftBank’s market cap and close to 90% of his net worth. ............ The star attraction at the event: Robin Li, CEO of search giant Baidu. Though Ma’s startup had swelled to 2,400 employees and $50 million in sales, Alibaba’s future looked uncertain. EBay had bought Ma’s auction-site rival EachNet two years prior and was dominating the market. Ma needed funding and hoped to get it from talking to Li, according to people who attended the summit. ........ Ma stood on the sidelines while bankers, keen to underwrite Baidu’s IPO, scrambled to tee off with Li. As a nongolfer Ma even found himself the subject of a teasing, $100 bet by other delegates: Which newbie could drive the golf ball the farthest–the slight Ma or the brawnier founder of SoftBank-backed UTStarcom, Ying Wu? ....... At the cocktail reception later that day Yang started talking to Ma, his old tour guide from eight years before. ...... Soon they slipped out through the patio doors ahead of a steak-and-seafood dinner and headed for the beach, a five-minute walk away. Within 30 minutes they had talked–mostly in Mandarin–about a partnership that would change the fortunes of both their companies. ....... Ma later told venture capitalist Deng that he had never expected to negotiate with Jerry at Pebble Beach. “Somehow they just chatted and then found out it was a good idea,” Deng remembers. “They made the decision quickly.” ...... “The Chinese ecosystem was not really Jerry’s natural habitat,” says Carmen Chang, a lawyer who helped lead Google’s 2005 investment in Baidu. “It meant he had to work harder.” ....... The deal was exceedingly complex, and both Yahoo and Ma almost walked away a few times. At a CEO conference last March, Ma recalled that Yang eventually sat him down for dinner at a small Japanese restaurant and convinced him over a glass of sake. ........ THE ALIBABA DEAL ALWAYS looked a bit risky. Even Yang had to be talked into doing it initially. Half of Alibaba’s value was attributed to Alipay, an online payment service, and Taobao, the e-commerce site that was up against eBay’s EachNet. Both were losing money. But Yang says he was captivated by the founder. ... “Once you meet an entrepreneur like Jack Ma, you just want to make sure you bet on him,” he says. “It’s not a hard decision.” .......... EachNet, the rival that looked like it might kill Alibaba, was doing just as badly as the brawny golfer who’d hacked at the ball at Pebble Beach. EBay’s management insisted on controlling the Chinese firm from San Jose, demanding a 3% charge for listings and a standardization based on eBay’s technology, slowing the site down. Ma watched and learned. ...... With its $1 billion investment from Yahoo, Alibaba held off on charging for listings, prompting merchants to flee EachNet for cheaper, faster Taobao. By spring 2007 Taobao had taken 82% of the online auction market, leaving EachNet with just 7%. ...... Activist investor Dan Loeb won a proxy skirmish and grabbed three board seats. He called for Yang’s head and got it in January 2012, when Yang finally stepped down from the boards of Yahoo, Yahoo Japan and Alibaba. ..... Yahoo sold half its stake in September 2012 for $7.1 billion before tax, or $13 a share. (Alibaba would close at $94 exactly two years later.) ..... “In some ways the Americans got played,” says hedge funder and Yahoo investor Eric Jackson. “Yahoo panicked while Masayoshi Son kept his head down. If Jerry had been around, he would have had the long-term view as well.” ....... Yang brokered one of the first successful Asian investments in the messaging sector earlier this year when he introduced Alibaba to one of his investments, Tango, which has more than 200 million registered users. While Alibaba had its own Chinese messaging service, Laiwang, it wanted a presence outside the country and in March invested $215 million, valuing Tango at $1 billion.
Marissa Mayer: Going Down?
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| Marissa Mayer (Photo credit: Wikipedia) |
The media builds you up, then the media breaks you down. That is their bread and butter. But the questions I am asking are:
(1) Is/was Yahoo ever salvageable? Did it ever have a chance to become a Google/Facebook/Amazon/Apple again? Or had it descended permanently to an AOL status?
(2) Is two years enough time? Maybe it is. I don't know.
(3) Marissa never was Steve Jobs. She has no track record of having invented an entire industry in her early 20s. So this never was like a second coming of Steve Jobs. But I did think then and do think now she was Yahoo's best hope. Blaming Marissa now would be like blaming Barack Obama in 2010 for the sorry shape of the US economy. Although, let me make it clear, I do not think Marissa Mayer is Barack Obama.
(4) And all along I am looking at Jerry Yang's master stroke of having invested a billion dollars in Jack Ma. That move was as brilliant as the founding of Yahoo itself. Are more such moves possible? I would like to believe so.
What Happened When Marissa Mayer Tried to Be Steve Jobs
Saturday, December 20, 2014
Can Poverty Be Cured?
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| Percent poverty world map (Photo credit: Wikipedia) |
A poverty cured world is one without hunger, because the world already produces enough food, but will now also learn to distribute. It is a world where 5% of the people are taken care of in terms of their basic needs, just because. 100% employment is actually bad. You need some churn in the economy. Another 2% might not even be in a position to work, and they are taken care of. And there is willful employment for the other 93%. Everyone has internet access through their cheap smartphone. The Internet is in the air.
Basic food, basic shelter, basic clothing, internet in the air, basic education, basic health. The costs are not that high. But it is we that are so disorganized. And the Internet itself can be that organizing tool, the best there can be.
The Alexis Ohanian Book
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| English: Alexis Ohanian, one of the founders of reddit, as he speaks about his experience getting reddit from a startup to one of the top competitors in User-rated news and networking. (Photo credit: Wikipedia) |
I borrowed it from the New York Public Library. I guess the guy did not make any money off of me. Look, Ohio Man, I am used to reading stuff for free!
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