Smash Notes

Back to Apollo’s Yahoo Playbook, 5 Years After the $5B Deal, with Jim Lanzone.

Why Did Yahoo Build Its Own Search Engine Again After 17 Years?

Jim Lanzone says Yahoo Scout is not a frontier model like Gemini, ChatGPT, or Claude, and it is not meta-search in the way early Perplexity was, sitting on other engines the way Dogpile once did. Scout is a product on Yahoo's own data. Yahoo is still the third-ranked search engine in the United States, with 30 years of search history, publisher relationships, a knowledge graph, and what it knows about a user. Scout grounds that data, sends it to a lightweight model, and Yahoo renders the result. At launch the model was Anthropic's Haiku. Yahoo uses others now. The answers are unique because the data is Yahoo's.

The strategic reason was sharper. For 17 years Yahoo outsourced search, largely to Microsoft, who is still a partner. That left one of the most important products and revenue streams in someone else's hands. Owning it again was, in his words, life-changing. He spent his first ten years in search and cares about results that go past ten blue links. Yahoo also stopped competing with its publishers and went back to sending them traffic, which he treats as the job.

Transcript

Apollo’s Yahoo Playbook, 5 Years After the $5B Deal ·

Sourcery

More from this episode

  1. How Did Apollo Buy Yahoo From Verizon?Jim Lanzone says he was not at Apollo when the firm decided to buy Yahoo.
  2. What Did Jim Lanzone Do in His First Six Months at Yahoo?Jim Lanzone says Yahoo was his third turnaround. Ask Jeeves was the first, during the web 1.0 crash. A 1990s startup he helped found was bought by Ask.
  3. How Is Apollo's Yahoo Turnaround Different From a Typical Buyout?Jim Lanzone says people always ask what it is like to work for private equity, and the reputation is not always good. His experience has been the opposite.
  4. Why Did Yahoo Give Each Brand Its Own General Manager?Jim Lanzone says Yahoo is a conglomerate, not a one-product company like Pinterest, Snap, Reddit, or Roku.
  5. Why Did Yahoo Shut Down Its Ad Tech Business?Jim Lanzone says the biggest asset Yahoo divested was AOL, and the first was Edgecast, a content delivery network competing with companies like Akamai that he…
  6. How Did Yahoo Return Apollo's Capital So Fast?Jim Lanzone says Yahoo has paid back pretty much the price Apollo paid, and that this is public.
  7. Why Do Big Internet Companies Fall Asleep at Scale?Jim Lanzone says the usual failure at scale is falling asleep at the wheel.
  8. Why Are Tiny Search Startups Valued Above Yahoo?Jim Lanzone says he is not kicking himself for acquisitions Yahoo missed, because startups have been priced so high.

People

More answers like this

Related episodes

Plays from this note through the rest of the episode.

Weekly highlights

One letter a week.

The notes worth hearing, with the minute they were said.