Will Marissa Mayer's Spending Spree Pay Off?

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May 15 (Bloomberg) -- RBC Capital Markets' Mark Mahaney, `Haro' founder Peter Shankman, Frankly CEO Steve Chung and Jarden Corp.'s President Martin Franklin discuss Marissa Mayer's strategy for running Yahoo. They speak with Trish Regan on Bloomberg Television's "Street Smart." (Source: Bloomberg)

Tell you about marissa mayer's overall strategy, especially when you combine this with her 34 other acquisitions she has done since taking the helm?

He has come in and made a lot of appropriate, somewhat aggressive that's. she has paid to take those bets.

I do not think any of them are a dramatic needle moving acquisition.

Potential a tumbler is.

She has filled in a lot of the holes yahoo!

Has unfortunately created for itself.

She is doing the right thing whether it pays off or not.

It will take two or three years to know with certainty.

He looks tame when you compare her with mark zuckerberg out there spending 19 billion for whatsapp.

What do you think?

The problem i have is i understand why they are doing it.

No one really uses yahoo!

Marner ship -- partnership percent.

The problem is when you try to rebuild a brand like that, people have artie moved on.

You cannot really find anyone that uses the messenger services.

You are trying to pull people back in for things they have already been attached to.

So this is not so much and acquisition as an apple higher.

They are bringing in the talent to build other things for yahoo!

That hopefully will drive users back.

And you get on the platform you like, whether it is messaging or e-mail, very hard to convince people to move away.

He has a lot at stake.

She is making the acquisitions in an attempt to improve the situation.

How would you grade what she is doing so far?

I think as the previous guest has said, there are two priorities i would say.

One is mobile, and she has been forthright about saying that.

The other is the demographic.

The target is 13-20 four-year-old female.

I bet half of them do not use or have even heard of yahoo!. not relevant in their day to day lives.

Very different then when i was growing up.

In some ways, yahoo!

Should have a lot to offer because you go to the platform and there are all types of platforms, versus google which is the simple page.

They have the things necessary to do your day to day work.

No one will ever leave aol.

Look at how much it has to offer.

We could not believe.

Everyday buying new things.

When you have an aol e-mail address, people laugh at you.

A tough move to get people to go back to those who say my parents had a yahoo!


All of these acquisitions going on.

Going on everywhere.

Everyday i come into the office and we have a new deal to talk about.

Why do you think this is happening now?

The feelings the lower cost of capital may be at the end of its run and a slower economy.

So you want to spice of growth.

What better way to grow than to buy a business at a reasonable price if you can.

You are in the consumer you are looking for a lot of bargains right now.

Mark zuckerberg has been a billionaire for his entire adult life.

What is 19 billion for whatsapp?

What do you think of the valuations.

I am the wrong person to ask that?

I live in a world where funny money does not exist.

I look at the deals and scratch my head.

I am the wrong guy.

It is official.

We saw this back in 2001 when i was running a pr agency and was approached to do a virtual pet cemetery.

I went to my staff and said are we at that point?

Are we done?

You have seen tech bubbles before.

Anything that indicates when you see this kind of activity in the merger and acquisition space and people willing to pay billions and billions of dollars were companies that are not profitable, does it make you nervous?

It does somewhat.

One of the major reasons there is this is because there is so much cash in the sector.

If you add up the money that could go into technology, probably substantially higher.

These are companies that over time have amassed a big cash war chest.

Yahoo!, google, amazon -- they will spend it.

Hopefully some of that will come back to shareholders and hopefully through the acquisitions.

I have lived through the last one and a couple of these.

You have businesses that are dramatically profitable.

Look at the margins of facebook and priceline or ebay.

The largest companies trading at 16 on the 17 times earnings.

Does not mean that acquisitions cannot be poorly done, but i think the environment is very different.

This is good for you.

You are the competitor to blank and the competitor to snapchat.

You have to be excited you are seeing this momentum and enthusiasm were companies such as your selves?


We're just getting started.

I think there is a massive shift to mobile.

I know it is thrown out as a hype word, but i think we have not seen the power of mobile in the full final iteration yet.

I think messaging is the key component in mobile that if you do not have a messaging play and a mobile play, you are really going to be irrelevant in the next couple of years.

I do not think we have seen the last of the acquisitions.

I think it is an exciting time for me and my fellow entrepreneurs here in silicon valley.

I look at it like the railroads.

I cannot remember 1200 or so companies that went public.

The reality is the railroad was truly differentiating.

Just a question of what ones will have value.

Mobile will be where we are going.

The key is, how many apps can you have that can benefit you?

Or average day using 5, 6 or seven max.

That includes for travel, messaging and ibo -- e-mail.

Google is one app that does six things.

When will he get to the point where we have these three things . the key winners will get those and put them together in one bundle.

Lex martin sticking with me.

This text has been automatically generated. It may not be 100% accurate.


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