Mayer's acquisition spree doesn't turn Yahoo around, but it starts to solve core problems

Here are some wins she’s racking up that aren’t as immediate as revenue that could nonetheless prove important in actually getting this Titanic to float again:

The stock – It may seem backwards to a lot of entrepreneurs who prefer building to marketing, but the stock price — a sometimes arbitrary amalgam of confidence, buzz, and perception– is key to driving reality in a case like this. A rising stock price does a few key things that matter. It keeps investor pressure off Mayer, so she can actually focus long term, not quarter-to-quarter. Eventually she is going to have to make some bold product bets that will take time to come to fruition. It also gives Yahoo a currency that matters and incentivizes acqui-hires to stay around.

People take Yahoo’s calls again – A real nadir in Yahoo’s ability to do anything meaningful was several years ago when it tried to acquire Yelp, and the team balked, because they didn’t want to work at Yahoo. When you can’t even acquire talent for a premium, you are hosed.

So now Mayer can acquire companies. But aren’t acquihires a lousy way to get talent? – Yes. Everyone says these moves are about talent, but the quality of the talent still left at a struggling acqui-hire candidate is a big question mark. Sometimes it’s excellent. Sometimes it’s not. If the talent will actually stay is another big if. And how hard that talent will work while it’s there is yet a third big if. A lot of people refer to their lock-up times at a giant like Yahoo or Google as “vacation.” But baby steps. Compared to where Yahoo was in an earlier era, the fact that a company like Tumblr would sell to them with a straight face isan improvement. Yahoo didn’t get in this hole overnight, and it won’t get out of it overnight.

Creating a better environment so the new talent (if indeed it’s great talent) doesn’t leave – It’s the little things that make up a culture, and Mayer has been steadily focusing on little things in house, while she feverishly does deals to inject more talent. Things like giving the team UP bands, better food, iPhones, and the like. These telegraph to the team that they matter. And those little things do more than raises or empty promises about the future, especially as everyone is talking up the new talent coming in.

Unfortunately, it isn’t a complete fairytale:

The next thing Mayer has to do is cut staff in a big way. Whenever you are trying to change a culture, there are floaters in-house who resist that change. And everyone knows this company is still too bloated. The people invested in the old way things were done at Yahoo will drive the new talent out, if she lets them. There are two reasons a big layoff is — regrettably — important: To help change the culture, and to make the company leaner and more profitable. 

Still, Marissa Mayer is probably the most likely to pull this off successfully.