From dotcom hero to zero

IT WAS one of Silicon Valley’s most riveting success stories. Now it stands as a warning to others. Yahoo began in 1994 as a lark in Stanford’s dormitories, when two students, David Filo and Jerry Yang, assembled their favourite links on a page called “Jerry and David’s Guide to the World Wide Web”. The site, which they renamed Yahoo, quickly became the “portal” through which millions first encountered the internet. At its peak in 2000, Yahoo had a market value of $128 billion. In the dotcom version of Monopoly, Yahoo got the prime slot. This week its history as an independent firm came to an end. On July 25th Verizon, a telecoms giant, announced that it would pay around $4.8 billion to acquire Yahoo’s core business (see ). The sale will come as a blessed relief to shareholders. Yahoo churned through four chief executives in the three years before the hiring of Marissa Mayer in 2012. Her efforts to turn the company round may have failed, but the seeds of this week’s sale were sown long before she arrived. Three problems explain the firm’s demise.