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GOLDSEA 100
No. 8: Jerry Yang
Yahoo! Inc
ahoo! is an utterance that might well escape the lips of a 32-year-old with a $3 billion net worth based on a 10% stake in a company enjoying a $30 billion market cap. Especially if he racked it up in under four years flat. Neither Bill Gates nor Marc Andreeson came close to matching that kind of breakneck return on sweat equity.
In mid-1995 Jerry Yang was a Stanford engineering grad student with a winning squinty-eyed grin who had landed his first million in venture capital. Today he's the co-parent and co-Chief Yahoo of a webglomerate that claims the daily attention of 25 million pairs of eyeballs -- and that manic grin hasn't dimmed a watt. There's still a fairy tale quality to the events that began in the spring of 1994 when Yang put up a web page containing his name in Chinese characters, his golf scores and a list of his favorite internet sites. Six months later he and David Filo hit on the idea of Yahoo!, a name suggested by a slur tossed at them by Filo's dad. The yahoos turned it into an acronym by reverse-engineering the mock-sonorous "Yet Another Highly Officious Oracle." Whatever, it worked. By early 1995 the site was bookmarked on every browser in cyberspace.
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Masayoshi Son, head of Japan's Softbank, had the prescience in 1995 to take a 20% stake in Yahoo! A few months later when Yahoo! held its IPO, Son snapped up another 17.02%, putting him in effective control. He then installed a professional management team to fill the CEO, COO and CFO spots. By then the stakes of Yang and Filo had been cut to about 12% apiece, but Son kept them on as Yahoo!'s heart and soul under the title of Chief Yahoos. Their job is to ooze irreverent inspiration. Of the duo Yang is the more outgoing and better suited to carrying an empty briefcase while snapping orders into cellphones. Filo plays a quieter behind-the-scenes role. Together they've guided Yahoo! into foreign-language extensions, local guides, print magazines and e-commerce.
Not content with 95 million pageviews a day, Yahoo! recently acquired GeoCities, a top online community that offers free email and homepages. That keeps Yahoo! number one portal with about 10 million more pairs of eyeballs than the 22 million AOL grabs after adding Netscape's 8 million to its own 16 million dialup accounts (the total is reduced by overlapping visitors). Yahoo!'s taking no chances. It recently launched ad-subsidized dialup accounts for $14.95 a month.
Yahoo!'s market cap is off the $38 billion peak reached last fall. For the moment, though, it enjoys a clear leg up over rivals in both visitor count and ad sales, actually having turned a $25 million profits on 1998 revenues of $204 million. Ad revenues should more than double in 1999. But in the hyper-charged, hyper-ventilating cyber-universe, there are no guarantees. Just ask Marc Andreeson. Yahoo!'s top-dog status is threatened by the marriage of rivals to giant deep-pocketed suitors eager to settle Cyberia. The bone-crunching shakeout to come in the next two years will leave half eating permafrost.
Chih-Yuan Yang was born in Taiwan in 1967. His father died when he was 2. As he was about to enter his teen years, Yang immigrated with his grandmother, mother and younger brother and settled in San Jose. After he and fellow electrical engineering student Filo hit on the idea of a web directory, they hacked code to sort hyperlinks into hierarchies, giving birth to "Jerry and David's Guide to the World Wide Web". The rest is web legend.
"There's a fairy tale quality to the events that began in the spring of 1994 when Yang put up a web page containing his name in Chinese characters, his golf scores and a list of his favorite internet sites."
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