Tuesday, April 10, 2012

What does Yahoo layoff mean to a VC like me?

I got this info while I am meeting with friends, that Yahoo laying off his product team and that means a big layoff in Indonesia team. On the long weekend, a few friends text me and asking for a recommendation which one should they hire. Since I don’t know most of them, then my friend doing Linkedin research to most of them. That’s how useful the social network like Linkedin is.

On Monday, a reporter asked me what does this means to the industry. This got me thinking since everyone suddenly hyped up by this Yahoo layoff. I believe this doing GOOD for most of the team that is laid off, to Yahoo and to the industry as a whole. Here’s why:

  • Yahoo has been for so long undecided on what they want to do with their future road map, especially in US. But in emerging country like Indonesia, Yahoo is undisputed leader as portal in which they are able to send massive traffic to most of their content affiliates like Kapanlagi, Kompas, etc. They are doing very well when it comes to advertising revenue. Massive growth! But when it comes to product development, the Koprol acquisition doesn’t mean much since they halt the development to introduce this as new services. As most corporate acquisition usually happen, if it doesn’t comes as major revenue contributor, basically you are forgotten. Know they want to focus to become portal and media, then they can focus and forget all the product development that is not their core strength. Big bold move that will slim down Yahoo to move quickly and build their core strength to become strong portal.
  • When Koprol acquired by Yahoo, they are not in a good position to sustain as services as that time no venture fund is going to finance a pre revenue Internet company. Then Yahoo comes as savior to put Indonesia on the map. A big acquisition by Yahoo means that’s something going on in this country. Suddenly most big guys jumps into Indonesia market to look for startup ready to be invested and all the startup hype started.
  • Then a big product development started in Yahoo. With their massive resources and network, they build a strong developer team build with a global framework and scalability. Who else can get this access to information if it’s not comes from years of experience like Yahoo? Then when this layoff comes, suddenly all this information are available to any company that can afford the ex Yahoo team. What a good proliferation of knowledge and resources!! I believe their CV is like hot cake, everybody want to get the slices. Even most of the company that we invested are actively seeking who wants to be hired!
  • After become VC for almost a year, I realized that there’s so much gap between product development and business acumen. Most startups that we talk are in idea stage, product stage and not even in the understanding of business itself. Not to mention understanding of market and scalability. Now given the choice, I will definitely invest on somebody that already failed in their previous startup business than somebody that is really new and have an idea about startup. At least they know what NOT to do and listen more carefully towards advise and they have some good network to realize their vision. So, I will definitely finance the guys from Koprol than any nifty startup idea from someone else.

By this analysis, what does Yahoo layoff means to me? It’s GOOD for them, GOOD for Yahoo, GOOD for the industry and mostly, it’s GOOD for a VC like me!

So, friends from Yahoo Koprol, welcome to the exciting world of startup!

Andi S. Boediman
an ex corporate guy who enjoy to become VC than to run someone else company

1 comment:

  1. VERY TRUE! Back then, of course Yahoo weren't just randomly select people for Indonesian Office. Those who already possess a sufficient knowledge of digital industry & the passion to learn more would just get hired by Yahoo. Furthermore, these people just absorbed everything that Yahoo shared and automatically these knowledge & experience is in their blood.

    Yahoo's decision to lay off these potential people is like unleashing a net of full fresh fish. Some of them might still need to be taken care of (aka nurtured aka work in companies), some of them probably ready to become real delicious dishes (become entrepreneurs). The last one, yes, will do good for you, Sir :-)

    Anyway, GREAT point of view, Pak Andi :-)