within yahoo!what is the strategy for growing the business now you are within this bigger company? >> we have a novel ad platform. it's all about wide-open creative expression. trying to get the most creative parts of the industry, to give them a space, a digital space where they can tell those same stories. where they can inspire us to become customers of these brands. get us to aspire to drive the beamer. or drink the coke. yahoo! is building more and more content on top of tumblr. there are digital magazines you have heard of them a -- heard of, yahoo! food, yahoo! tech and travel, those are built on tumblr. we launched the ability to take that advertising we're developing for the tumblr network, where you come to get the reach demographics and engagement of the tumblr network. you take that same content and roll it out the yahoo! network. -- roll it out to the full reach of the yahoo! network. >> i want to ask you about the "competition." i know there is not necessarily direct publication. what

he sold it to yahoo! before he was 30. it is now one of the most creative and social blogging platforms, all from a guy who dropped out of high school. tumblr founder and ceo david karp. thank you for joining us. thank you for having this on the schedule. >> i do have a schedule now. >> now you are part of yahoo!, you have meetings. >> this has turned into a major team of 300 people. a major business we launched 1.5 years ago. >> tell me about you, where you grew up. >> i was born and raised in new york city. my mom was a teacher. my dad was a composer. i found myself surrounded by all of this creative technology growing up. in my dad's recording studio. i remember spending those nights and weekends in the recording studio. it felt like the starship enterprise. >> when did you learn how to code? >> i learned markup languages and i was 11 years old. one of the first things that drew me into it were these personal identities people were creating for themselves. i saw the aol profiles and away messages. i really loved that ex

yahoo!, too. there's alots on lot on tap next hour. >> jeffrey cleveland, are you expecting -- are we seeing a slowdown in the economy or not? with the durable goods report with some of these disappointing earnings reports because of the strong dollar and lower oil, are we then therefore, seeing a slowdown in the economy? we'll talk about it later on what the fed is going do about that but what do you think? >> i don't think we're seeing a slowdown. don't call it a slowdown. i think business cap ex did really well midpart of last year. heightened expectations that would continue. a little bit too much enthusiasm for that. we're getting pushed in the opposite direction. jobs are better. gas prices are lower and that's good for the consumer. overall, the economy looks great. it looks pretty good. is it a 4%-plus economy, bill? i don't think so. is it 2.5% to 3% sure. >> things change so rapidly. >> he was saying if you want to see the top line growth we need 3%-plus. >> you folks stay right th

yahoo!issa mayer is taking heat from activist investors over her plans for all of that alibaba cash. is her job on the line? ♪ >> on cory johnson and this is "bloomberg west." google is the undisputed search king but some cracks may be showing its armor. their slice of the u.s. search market fell from 79% to 75% last year, the biggest drop since 2009. meanwhile yahoo!'s jumped from 7% to 10%. but must not pencils and continued gains just yet. the heat is still clearly on yahoo!. activist investors are ramping up pressure on yahoo!. the firm fired off a letter to marissa mayer, urging her to disclose the plans or the company's lucrative ali baba stake. it also pushes yahoo! to consider an exploration or a combination with aol. with me now is erik schatzker. paul sweeney is also with me. paul, do the pieces of aol's programmatic and search business meld well with yahoo!? >> aol's programmatic platform that they have been investing in would meld with anyone that wants to be a player in online v

yahoo! and its lawyers choose to structure it -- however yahoo!ts lawyers choose to structure it, what it needs to be is a spinoff so the shareholders benefit from that unlocked value and not marissa mayer. what they perceive is happening is two things, on the one hand or a semi or is compromising big in the day transactions, which is scaring the differing -- big and the day transactions, which is scaring the living daylights. the other, she is going to do a split off which means she somehow exchanges the value of the alibaba and yahoo! japan stakes for some kind of consideration, whether it be cash or stock which he can use for her discretion for other purposes, presumably acquisition. they are scared to death of those because she believes she is squandering shareholders money. >> maybe find some way to swap out the asset, rather than cash out the asset, which is a tremendous investment back in the day. do we get a sense that some of the acquisitions -- marissa has been a crummy acquirer in all of the acquisitions they have done in her tenure. >>

i gave in a few years in. >> now you are part of yahoo!you have meetings. >> we had meetings before yahoo! into a majored team of nearly 300 people. a major business we launched 1.5 years ago. >> tell me about you, where you grew up. tell me about your parents. >> i was born and raised in new york city. my mom was a teacher. she started in the music industry. my dad also in music my dad was , a composer. he did a lot of work for television, particularly news. i found myself surrounded by all of this creative technology growing up. in my dad's recording studio. i remember spending those nights and weekends in the recording studio. it felt like the starship enterprise. >> when did you learn how to code? >> i learned markup languages when i was 11 years old. when i was 13 or 14, i started enough to do ant little damage. one of the first things that drew me into it were these personal identities people were creating for themselves. i saw those in the aol profiles and away messages. i saw that in the websites people were building. i really love

first let's trade yahoo!. yahoo! is thinking more about being a media company as opposed to a tech company. do you think that's the right strategy? >> first off, i think the model is out there. comcast has done this, of taking distribution and marrying it with content. yahoo! is not the same company but if they didn't have that $9 billion of cash on the balance sheet, i would look at yahoo! more as a takeover candidate tlab ha than an acquirer. >> i like the stock around $50. i think the alibaba tax savings plan and any scheme they come up with will be highly creative and that will move the stock. i could own the stock here. >> i agree. i think this will largely turn on how they treat to stake. thing about the core is even if you turn it around, it is just not a good business. it's banner ads. i have a blog. believe me. cpm is $4. nobody wants to really be in that business. that's why everyone is saying, i'm a technology company. i'm distribution -- at the end of the day if you're in the page view game, it is a defla

next it is better than yahoo! domestic? >> yahoo!omestic is trying to figure out what to do next. >> should we be happy for yahoo! or mad for u.s. taxpayers? the notion they can take this $14 billion tax bill throw in a little operating business and combine it with $40 billion from alibaba and say we don't know any taxes -- that's a pretty amazing loss for the citizens of this country my for the money to use. >> that is a good question. it's not the first time this has happened. liberty ventures did this for their stakeholders as well. it's still getting paid, just not a company paying for it. >> paying less taxes is always goods -- is always good so i'm all for it. >> says the guy who comes from the city where bridges are collapsing. i have not run the transcript yet. what do we hear about the tumblr business? >> i will say that the branded advertising growth, which is the key number it was down about 5% in the september quarter. you could look at it as less bad. my guess is they probably played into it. when you look at all of the

yahoo! is building more and more content on top of tumblr. digital magazines, yahoo! food. yahoo!nd travel. those are built on tumblr. we launched the ability to take that advertising we're developing for the tumblr network, where you come to get the reach demographics and engagement of time on the -- of the tumbler network you take that same content and roll it out the yahoo! network. >> i want to ask you about the cover edition. what do you think of what they are doing? >> they have done a lot of things that nobody else is doing. they are kind of on the other side of a fight we have been fighting. giving people more identity. create something that is theirs. one of the things that drives me bonkers about medium is they try to make it a commoditized network. they strip identity away. with lots of long articles from various people rather than a place where i can set up and have my blog. myspace, my place on the internet. but they are doing cool stuff with longform text. fine--vine is doing cool stuff with video. >> what about facebook? are you in competition? >> we are all kind of

yahoo! and apple are getting investors. shares of both companies are surging. outbreak -- this childhood disease is making a comeback, and it looks like it all began at disneyland. and, returned to the super bowl -- nissan comes back to advertise after sitting out of the game for 18 years. welcome to "market makers." i am stephanie ruhle. my partner erik schatzker is out this morning. so, phil mattingly is here which makes me -- >> so lucky. all the way from washington, d.c., survived the blizzard thing. >> wrote to have you. start with the bulletin. >> the top business stories -- shares of apple surging, up almost 8% after it reported a record-setting $18 billion profit in the last quarter. give credit to the new, bigger iphone. the company sold 75 million of them in three months. yahoo! is rising as well. the internet company plans a tax-free spinoff of its entire stake in alibaba. investors had pushed ceo marissa mayer to return cash to shareholders and to find ways to cut taxes. it sound

so what do we do with yahoo! >> we hear her saying you get the core business for free. >> i'd say you're still at a place where you don't worry about it. take the sum of the part, take the core of business. they tell us the aol merger is exactly what they should be doing. but either way, they are catalysts. i think the spinco is really what you wanted. p. >> i don't think there are that many more levers to push, but i do think here you're getting the core business for effectively nothing. so the down side, although you will see it again, is limited. takes h has it has been for a couple years. >>> coming up, a strong u.s. dollar might be derailing the mar get, but is there a way to profit. we needed 30 new hires for our call center. i'm spending too much time hiring and not enough time in my kitchen. [ female announcer ] need to hire fast? go to ziprecruiter.com and post your job to over 30 of the web's leading job boards with a single click; then simply select the best candidates from one easy to review list. you

yahoo! -- avoiding billions in taxes on its ali baba stake. it should have been a big gain for the government but it's a big gain for meyer. we will talk about that when bloomberg west continues. ♪ >> i'm cory johnson and this is "bloomberg west." the spinoffs, they keep on coming. yahoo! says they will spend off a $40 billion stake in alibaba to a separate company called , spinco. marissa mayer's has been under pressure from activist to find some kind of value in the alibaba asset and turn more money to shareholders. the news has yahoo! shares rising in after-hours trading big time. even as the company reported the rest of -- who saw a 2% drop in sales and a 52% drop in its fourth-quarter profit. what took so long? spin it off? that's it? >> i think they had a great outcome. that was the big question. it couldn't have turned out any better for yahoo! investor. it will beg the question which is what happens with the fundamentals once the spin runs its course. give yahoo! credit, they had a b

this is something that is the right of yahoo to do.heir bored has obviously decided to do the spinoff. from our interspective operating the business day-to-day, today we have a 15% shareholder in us, yahoo. after the spinoff we'll have another 15% shareholders spinco. it doesn't really change anything from our perspective. but i would like to just take this opportunity to thank marisa mier and also jackie resus, who has been on the board of directors until the i.p.o. they've been great partners with us over the last couple of years. >> joe, i know you're a great deal maker, you have made lots of deals for ali baba. is yahoo on your radar at all? can i ask that? >> we are very focused on our business in china. if you look at the deals we do in terms of investments and m.m.a. activity, over 90% of them are focused on how we grow our user base, how we increase user engagement and how we expand our categories in china. and with limited activity that we do outside of china is very much focused on the cross border trade. always with one leg

when you look what yahoo! did and outperformed does that give you indication for apple or totally different story. >> totally different story. apple is iphones and iphone 6s. yahoo! has a floor under asian assets but apple will have blow out numbers are to the iphone 6. yesterday was an awful, awful earnings day. today will shape to be a very good one. into the weekend are good if you own companies like apple. i used to own it. i don't own it anymore. david: would you buy it now, it is about 110? >> not yet. i think one of the things that reason he sold apple i felt like i didn't need to buy an ipad anymore. i didn't need up to grade my iphone. >> guys, jump in here. liz: go ahead, cheryl. >> a couple of crucial headlines. they will spin off into new company. this new company will distribute the shares. basically she is splitting things off and that was something else we were looking for now. this is crucial. this deal completed first quarter, excuse me, fourth quarter of 2015. they have got a lockup agreement

yahoo also fell 6% on this news.e a listen. >> from our perspective of operations, nothing has changed. today yahoo is a 15% shareholder in us. after the spin off we will have another corporation that is also a 15% shareholder in us. >> somebody that says the street is getting the report all wrong. marty pyykkonen joins us. what are we missing on this sflpt. >> the chinese e-commerce stock market still early. people might be forgetting that. that is obviously a positive. they are still strong numbers that they put up. ebay would love to report those kind of numbers. i would say on the other hand we have picked up things recently where because the market is so early in china, you have other things that are getting some of the consumer traffic. you know alibabba may be facing a little of that. it is still early there. they are the big gorilla like ebay and amazon is to an extent. but it is still very early. that might be one thing that is a challenge for them right now. >> is there any concern about the chinese governm

. >> mean while, we haven't gotten to yahoo!. yahoo!nces plans to spin off its stake in alibaba, the chinese e-commerce giant feeling heat from a regulator in its own country. we'll talk about that. the dow and s&p, on track for the first back-to-back monthly losses since 2012. as january has been a rough one. more "squawk on the street" from post 9 in a minute. the lightest or nothing. the smartest or nothing. the quietest or nothing. the sleekest... ...sexiest ...baddest ...safest, ...tightest, ...quickest... ...harshest... ...or nothing. at mercedes-benz, we do things one way or we don't do them at all. introducing the all-new c-class. see your authorized mercedes-benz dealer for exceptional offers through mercedes-benz financial services. heat from a regulator in its own ♪ >>> share of yahoo! look to be up sharply. last night the company did what it said it would do giving guidance on its plans for its 15-plus percent stake, 384 million share stake in alibaba, do what many investors hoped the company would, creating what will be a v

yahoo! $15 million in taxes for it shares. with more, i want to bring in our bloomberg managing editor tom. they have options and they go to one investors like the most feared >> this is the one we expected and we have been writing about it a lot. we talked to her about this very obviously, investors like it. the question is, once you get out of the stake in the fast-growing business in china, the world-class is largest internet market, what is left? she has still got a stake in yahoo! japan, which is important. the core business and now that you're taking away the olive of a lure for investors number you have a core business going sideways. >> let's think about the core business. revenue is down 2% to 1.1 8 billion is an example of continued declines we see there. what will she do with the core business? >> just talking a lot about mobile, which is important to them, making sure people access yahoo!, the property which was once the hot goto place on the web. it is just not anymore. so reall

move to yahoo!rallying after the company revealed plans for a tax-free spinoff of its $40 billion stake in alibaba. as forb its quarterly results the company's profits did top estimates, revenue in line with expectations. mobile sales up 23. farhad, you glad to finally be able to look at the business as an existing core business? >> yeah. i'm glad. i'm not sure that yahoo! is very glad. i mean one of the things that they benefitted from, with holding all that yahoo! alibaba money over the past few years is that people didn't really pay attention to the core business. now that it's spun out, people are going to be paying more attention and, you know, one of the things that marissa mayer has promised is that this year would be the inflection point. she said this in the last earnings call that 2015 was the year that the new businesses would sort of start growing enough that the kind of legacy banner ad display business, the drop in that, would, you know, they would outweigh that. we'll see. i mean the

yahoo!.st happened to big tech companies? they do a lot of acquiring and do not focus a lot of money on their core business. is this the way it goes? >> the natural lifecycle of a company. at some point, you need to optimize and return profits to shareholders. that is an argument. i want marissa mayer to go to shareholders -- >> you want her to endorse your book? >> of course. it is snowing out, read this book, you'll enjoy yourself. this is selfish too. i want her to go to shareholders and say, we're going to give you some of the money back. will invest the rest of it in my plan and if you do not like it try to get me fired or sell the stock and by other equities. >> she need a war chest to figure out her next deal. >> they already have $12 billion in cash. it is a cash generating business. there's a lot of worchester there. -- there is a lot of warchest there. they're going out and acquiring companies, just to get programmers because it was the fastest way to get people to change the intern

wasn't the best thing for yahoo probably, but the best for the people who bought yahoo shares. sometimes shareholders win and companies lose. at issue is what the billions and billions that yahoo made after it invested with alibaba, what it should do. she had two choices. she could cash out the money and use the billions to make yahoo bigger and better, which would have exposed yahoo to billions in american taxes. or she could take the alibaba stock and essentially move it into a new bucket, and then avoid those taxes. but there would be no fun money to play with. which is a bummer. if you make tens of billions in a smart investment and then you can't use it. so what yahoo is going to do is it's going to spin out one of its businesses. now, it might be flickr, it might not. this is my purely hypothetical board. it spins out flickr, and then it gives flickr the alibaba stock. this is a totally legal tax dodge. if you own yahoo stock, you'll also own flickr stock as well, so you keep all those riches. then what? yahoo becomes a standalone company. no rich uncle. that makes meyer'

how can yahoo! avoid the tax bill seemingly do? ue? crawford, i will start with you. what is yahoo!o do? >> what got needs to do is keep their investors engaged and keep their investors happy. what that means is that they have to figure out a way to limit their tax exposure to this transaction. whether that tax respin out or some things do it ali baba if they can exchange their shares for cash. they need to make an effort here to limit their exposure. if they do not do that i think you are going to see massive shareholder callings for change. 35% is a big number. there are ways around this. >> as i often say, provine, i do not care about the stocks. it is intriguing that this has been the thing that is overshadowed everything that yahoo! has been doing for the last couple of years. >> i think one look at this is they have had the last couple of years, people focused on the ali baba thing. it will be interesting. how much faith the board places in the management structure to turn around this business. what portion of those proceeds at the end of day of the going to retain for organic

yahoo! announcing it will spin off it's remaining $40 billion stake in alibaba. those shares will be transferred into a new publicly traded company. alibaba makes up 85% of yahoo!'s market cap and has been a focus for investors since the chinese company's ipo last year. take a look at it trading up about 5.9% in frankfort. just days before alibaba reports it's own earnings chinese regulator criticized the retailer over the selling of fake goods. it has a zero tolerance policy for fake goods. eunice will join us in the next hour on that story. definitely an interesting development ahead of the highly anticipated earnings report on thursday. >> apple and yahoo! shares bucked the trend on tuesday. suffered the worst drop since early january. caterpillar, microsoft and dupont were among the worst performers. >> the dollar index has come off an 11 year high. morgan stanley cited the strong green back and lower oil in it's decision to push out it's forecast for a fed rate hike from march of 2016 t

yahoo has the display business which is going to trend down or sideways.e i would be all in on video. they could make a very high quality youtube co-exister. they are not going to beat youtube but that is where i would put my money. and that's why what the tumblr acquisition was about. i think that is what your going to see next year and content is really what yahoo has been about. and i think marissa is starting to dip her toe with the katy koric signing. i think that is a bad signing. i think katie couric is a awesome but. >> sure. >> we're getting more. so we're going to see how this ends up going. video and media on twitter will be super nova. so well get that the next time we have on you. we appreciate your time this morning. >> my pleasure. >> angel investor. >> shares of gopro slipping this morning in the midst of an across the board rally. we'll talk about why in a moment. nt, thinking about peopl? why are we so committed to keeping you connected? peopl? why combine performance with efficiency? why innovate for a future without accidents? why do an

yahoo is done.oo is not going to make any major acquisitions, and marisa will probably be out of that company in 18 to 24 months and it will be sold for parts. if you want to play in the game known as mobile, you have to be willing to make huge bets and buy things like what's app, instagram, and youtube, or you will just not compete. >> i want to go back to this point you're making, arguing that twitter is positioned really well versus youtube, which is taking a much greedier split with content creators. if twitter does start to gain any traction, what's to stop youtube from just saying okay, we'll adjust the split, we'll take a little less? they've already got a huge audience. plus, engagement on facebook already very strong. they're saying an average of 3 billion video views happening a day, happening right now on that platform. why is twitter better positioned than facebook, despite what you say, people are still watching videos on facebook. >> facebook has had tremendous performance. they fudge

take a piece of the yahoo!usiness and spin it off with the ali baba shares. >> the irs is ok with this. this is a new way of saying we can take this state we have and make sure -- shareholders happy by not having this huge tax. they had the ipo last fall and took a big tax and investors do not like that. >> the spinoff is fairly simple. as a citizen of this great nation, wanting my roads and bridges and schools to be better , missing $14 billion in revenue is fairly amazing. >> it's a lot of money. >> even to me. >> exactly. a lot of questions out there about how we do our taxes. how did we lose this $14 billion? it is not the first time it has been done. >> the cfo of yahoo! should get kudos for coming up with this plan. it does start to reveal what is left over. we saw sales numbers falling again with the core business that is yahoo! despite billions spent in acquisitions. >> it was the outlook for this quarter that was disappointing. it was not a great quarter. rss told me look, there will be ups and downs.

former yahoo interim ceo ross levinson. and under armour is giving its new app the super model treatment at ces today. the how the traders are playing that and an upgrade for the stock as well. up next our call of the day and a bold one on el pollo loco. >> the revenues were up very strong. when you look at the sales, that was up very strong. i own the stock. i think it can go higher. >> potentially buying more today on the dip. >> i like the numbers i saw. i see the growth there as well. >> the stock is popping after an upgrade but down big over the last few months. is pete sticking with us? >> he tells, next. no question about that. but your erectile dysfunction - that could be a question of blood flow. cialis tadalafil for daily use helps you be ready anytime the moment's right. you can be more confident in your ability to be ready. and the same cialis is the only daily ed tablet approved to treat ed and symptoms of bph, like needing to go frequently or urgently. tell your doctor about all your medical conditions and med

they wanted yahoo! japan to be part of this. >> yeah they hinlted on the call last night that maybe that's in the future. >> why do you think it didn't happen this time? >> there's licensing deals with yahoo! japan that makes it more complicated. >> when you now look at yahoo! on its own what do you think about the business? >> there's not much to be excited about it. the guidance for the first quarter was week however number one i think next month there's tun for them to rework the microsoft search deal and extract some better economics out of that or potentially shift over to google. there's a holy grail in may when they could potentially win away from google as well. >> she mentioned that on the call. do you think she has a chance? >> she talked about it and seemed enthusiastic so i'm sure they're working with apple. that could add to significant market share. >> how do we judge her tenure so far. she has done all of the right things when it comes to alibaba and the question is how do you judge the r

and yahoo's former interim ceo said on this show yesterday that twitter should buy yahoo. top tech analyst bob peck grease a -- agrees. and he's back with why that makes sense. and twitt j.c. penney getting a the huge bump today. what they say the rest of us might have missed jon is on the hot seat just after the break. he's got those snazzy new glasses on and everyone thinks he's the man. we'll see if his portfolio lives up to his ego when when he come back. (everyone) cheers! glad you made it buddy. thanks for inviting me. thanks again my friends. for everything, for all your help. through all life's milestones, our trusted advisors are with you every step of the way. congratulations! thanks for helping me plan for my retirement. you should come celebrate with us. i'd be honored. plan for your goals with advisors you know and trust. so you can celebrate today and feel confident about tomorrow. chase. so you can. [contain♪r door opening] what makes it an suv is what you can get into it. ♪ [container door closing] what makes it an nx is what you can get out of it. ♪ introd

yahoo owns 15% of alibaba. but that 15% is 85% of the value of yahoo. it's been to spin this off into another publicly traded company. it's expected to happen in the last quarter of 2015. so it's a big albatross off of yahoo. marisa meyer was looking to strengthen yahoo. now they've got a whole lot of money and they can answer critics that they're not just making money because they own a stake in alibaba. >> will it save on taxes as well? >> it's a tax-free transaction. i would like to conduct a few tax-free transactions, tony. >> yeah, me too. great to see you welcome back. ali velshi "real money" coming up at the top of the hour here on al jazeera america. two days after kurdish fighters declare victory in kobane. we go into the devastated town and hear from war-weary residents and facebook's decision to restrict images of mohammed prophet in turkey. caving to pressure or protecting the peace. that's coming up. >> welcome back to al jazeera america. we're gaiting a new look at the destruction inside the syrian border town of kobane. earlier this week

he nude to have on your mobile phone several apps from yahoo! and yahoo! is going to be your phone appmaker. that is just -- i question that. i think apple was already there. >> who should have been her? >> who should have been the ceo of yahoo! instead? >> the reason i'm asking this is i've watched, the stock has performed. she's only two years into her run. you compared her at one point to steve jobs and she -- >> she compares herself to steve job. >> it certainly took him a couple of years to get his act together and this was a troubled cup to begin with. i'm wondering whether we're making a judgment too quick. >> the story of my book is about the first two years of her run there. yahoo! owns a big stake in al by baba. right before meyer joins, they did a deal where alibaba had a lot of incentive to go public before the end of 2014. mayer had a unique situation that new ceos never get, that is how does she do getting it ready for the future when no one is looking at the core. is she going to take a lot of costs out of the business? is she going to get r

. >> speaking about mobile, yahoo!aw some good mobile ad revenue growth in their quarter just a day ago. marissa mayer has not spun out her ali baba shares -- now spun out her ali baba shares into pimco. would you have any interest in buying all or part of pimco? >> we don't anticipate entering into an agreement with yahoo! or spiconco. this is something that is the right of yahoo! to do. their board has decided to do the spinoff. from our perspective operating the business day today, today we have a 15% shareholder in us yahoo!. after the spinoff we will have another shareholder, that is the spinco. it doesn't change anything from our perspective. i would like to take this opportunity to thank marissa mayer and jackie races, who has been on our board of directors until the ipo. they have been great partners with us over the last couple years. >> i know you are a great deal maker, and you have made lots of deals for ali baba. is yahoo! on your radar at all? >> we are very focused on our business in china. if you look a

it was an online store builder and got bought by yahoo!. and it is yahoo!'s store. >> what was it like working at yahoo!? how long did you last there? the guy who was suspended every year. >> i was basically getting suspended from yahoo! too. i hereby apologize to the people i ever worked for. i barely lasted a year. >> you went on to write. >> yeah. >> and you started building your following. >> i suppose so. i didn't think i was building the following. >> what were you writing about? >> i was writing about software and i realized that no one would drag me away if i started writing about other things, too. >> at what point did you guys meet? >> we met at a party in paul's house in cambridge that i almost didn't attend. >> y combinator almost didn't exist. >> it's scary how close it was. >> how did you come up with the idea for y combinator? >> jessica was writing a book. >> that was the first book that i read when i moved to silicon valley. >> really? >> your book about founders. >> that's great. i never tire of hearing stories like that. it was hard to fin

can she take yahoo mail and invent the new snap chat?ing at the list of the top 100 in the apple app store. i couldn't find one that seemed to be a new invention from a big company. >> is she different than how she is portrayed out in public? you have a better sense of how people perceive her in private meetings? >> she is this person who is electrifying. in a meeting, she can't look you in the eye. she's looking off in the corner. she's abrupt. that doesn't make her different than mark zuckerberg or larry page or steve jobs. she is just a very different person on the outside than she appears to be. it is one of the reasons i wrote the book. >> thank you so much for coming in. that does it today for the "cycle." moking with chantix. my children always wanted me to quit smoking but i resigned myself to the fact that it wasn't going to work. but chantix helped me do it. along with support, chantix (varenicline) is proven to help people quit smoking. it gave me the power to overcome the urge to smoke. some people had changes in behavior, th

the digital magazines you have probably heard of, yahoo! tech and yahoo!se are built on top of tumblr. what was launched a few months ago was the ability to take that advertising for the tumblr network, where you come to get the reach demographics and engagement of the tumblr network you take that and offer it to the full reach of the network of yahoo. >> catch the full episode tonight. 8:30 eastern and pacific. "bwest byte," we focus on one number that tells us a lot. shelby holliday joins us from st. louis. it is toasty warm. maybe not so much. what is the byte? >> it's really warm out here. today's byte is 1121, the percentage growth of tech startup funding in st. louis making st. louis the fastest-growing tech city in the united states. that is according to cb insights. i'm not saying st. louis is the next silicon valley. all you people in northern california can cool your jets. there are a few reasons why st. louis is a great promising place. number one, there is plenty of talent. it's relatively inexpensive. the toasted ravioli is a big hit out here.

one we think about yahoo!ith aol, there are interests who think that this combination makes a lot of sense, and that is largely because these are companies that seem to be similarly structured similarly positioned, and frankly, similarly let's say, allocated when you think about investors in what they are doing . the problem we see is that neither company, in our view -- we cover yahoo!, we don't cover aol. but when we look at these companies, we don't necessarily know that the other one would help the other company. i don't know what aol would do for yahoo! and i don't know what yahoo! would do for aol. it is not like their strengths are the other costs weaknesses -- the others weaknesses. and yet you think that yahoo! will be making acquisitions, just not that kind of acquisition. >> when you think about yahoo! it is fair to assume that given the substantial proceeds to company receives from the alibaba ipo late last year that there are a lot of options at their disposal. they have shown that they are intere

people using yahoo! mail, over 100 million people use yahoo!s, and so they are looking at things in the future. they spent $1 billion to acquire tumblr which i think is still not seen as a brilliant investment, but the numbers and tumblr are getting better faster. if you look at google friends, you will find that tumblr is more popular than pinterest. the challenge for yahoo! and former is a meyer, has been to build up these other businesses for the day today when ali baba receipts into the history of yahoo! they may not spend it all off of they want of a displayed in the growth in china. >> that brings me nicely to my question for leslie, which is what is murthaarisa mayer's future? >> what benefits shareholders does not benefit marissa mayer because they are looking at what the activist investor star board has advocated, spinning off become a, which would require yahoo! court to be a couple billion dollar market cap company, much smaller than the $40 billion market cap it is trading at today. she wants rupees of shareholders was up she will b

that's not what yahoo! needs, but it is what twitter needs. >> she's, obviously, the other name in the frame right now. what do you think about her, is she going to make it at yahoo!? >> boy, it's tough. almost mission impossible what she's inherited. you've got the world's best platform from 1997 right, what do you do with that? she can't go out and buy everything under the sun. she bought what she could, she addressed attrition, which is critical. they have a great engineering team, and she runs aol, she runs aol. it's the same problem. you have to have someone that's just an amazing visionary to take this platform and turn it into something new. >> there's been talk of yahoo! buying something somewhere, even cnn i heard at one point. >> could be but hard to see -- >> 100% agree. >> that's the problem. >> she's got a group of shareholders who want cash back. they don't want to spend it. >> more hires. >> i think her move for maneuver is gone. i think she missed her chance. i think right now might be too l

yahoo!, hp can they be fixed? >> hp and yahoo! are not really technology companies at all.hey were technology companies in the 1970's and 1980's with hp, and in the 1990's with yahoo! these were technology companies, today they are fundamentally bets against technology. >> even though they are not technology companies, can yahoo! and hp be fixed? >> there are things one can do to streamline them. it is a mistake for them to radically try to reinvent themselves and become technology companies once again. >> you mention marissa mayer, what do you think her chances are of turning things around? >> she is by far the best ceo yahoo! has had in a decade. she should not be evaluated on whether she invents something new. that is setting her up for failure. the existing businesses are big, if you can improve those and make those work, that is fantastic. >> other than what you have written in this book, what are some things you believe that very few people agree with you on? >> an issue i have been outspoken about is this idea that college education has become something of a bubble.

when we come back, after yahoo!lans to spin off its stake in alibaba everyone started asking, is the company a it takeover target? kara swisher has answers and she's going to join us in just a moment. dow is down 134. welcome back to showdown! i'm jerry rice, here discussing the big race between the tortoise and the hare. my guest is stephanie branton. jerry, i'm going bunny. shocker. not really. you see, the hare's "thoracic limbs" allow for greater extension and elongated strides. look for the hare to leverage this advantage. ok. i would not say i'm into it. but let's see where this goes. [ buzzer ] do you like to travel? i'm all about "free" travel, babe. that's what i do. [ buzzer ] balance transfers -- you up for that? well -- unh. too soon? [ female announcer ] fortunately, there's an easier way, with creditcards.com. compare hundreds of cards from every major bank and find the one that's right for you. creditcards.com. it's simple. search, compare, and apply. [ ice rattles ] about what happens when you turn s

>> obviously, apple, i am going to be focused on yahoo!. how does it change? to me, yahoo! this is the quarter that they now have to prove themselves. this is where the ali baba story, it's yahoo! who has to sink or swim on their own. floundering around this $50 level. the most important earnings release in quite some time. >> i don't expect anything out of these guys. i this i the stock has capped at 51, 52. ali baba is the story. i think ali ba ba is going to surprise. to that extent, maybe they get some boost. i would be looking at google. a big run going into earnings. i'm cautious. they are getting into wireless. for a lot of people, this is what they don't want to hear. this is a direct link to the consumer. they really already have sengies. the stock rallied hard off of 495. it is giving you 20% growth. that's what i want to see in tech. the risk/reward is what you are chasing. >> i see these running going into earnings. i think this is a maybe the sell the news kind of event. what do they have to post in order to support their reports? >> i think it will be a sell t