Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Yahoo spends $58 million to fire its chief operating officer

washingtonpost.com

Post reply on HN
Print view View original

91–100 of 112 posts

Re: Yahoo spends $58 million to fire its chief operating officer

#91

Post by thenewbtg »

frandroid wrote: post #56
thenewbtg wrote: post #48

Earlier quoted context omitted.

There is nothing we can do, really. Money is very close to power, and obviously the relatively poor (those who rely on a salary) have far less say and control than the extravagantly paid (those who do not require a salary). It is a fundamental trait of our free and capitalist society. We're merely mourning obvious inefficiencies, "bugs" in the convoluted system of laws and philosophies and culture that govern our soc…

Sure, we can do something. It's called popular political action.

I would point out the recent fun little study showing that the class we are (those who work for a salary) have less say in policy outcomes than the rich (those who do not require a salary).

They bill it as "The US is more of an oligarchy than democracy" because those very few >0.1% of Americans have a greater political say than the rest of us.

Re: Yahoo spends $58 million to fire its chief operating officer

#92

Post by crystaln »

krjeidj87 wrote: post #84
smacktoward wrote: post #75

Earlier quoted context omitted.

Or there is the simpler explanation that executive compensation is high because there's nothing to stop executives from looting their companies anymore. The traditional forces that would have restrained them (public shame, strong boards, shareholder conservatism, labor unions, tax consequences, etc.) are all at historically weak levels today, so there's nothing stopping executives from raiding the cookie jar. And eac…

Wrong. Board of directors, who are elected by company shareholders, can limit executive pay. They do this constantly. I'm assuming you're very new to this.

Yes they can.

However it is far more profitable to increase the executive's pay so that it dwarfs their own obscene compensation. That is extremely common in public companies.

Re: Yahoo spends $58 million to fire its chief operating officer

#93

Post by talmand »

rokhayakebe wrote: post #30
sillysaurus3 wrote: post #3

I've been wondering: How's Marissa Meyer doing as CEO? I haven't heard much about Yahoo recently except that they acquired some companies in order to get talent in the mobile space. It's been about 1.75 years since she became CEO. Is that enough time for a non-Steve Jobs CEO to change the trajectory of a company?

I recently talked to a friend, an actual user of Yahoo products, who expressed happiness with the improvements they've made recently. They were referring to both the portal and web mail and they are very happy with the company as is.

I don't use the web mail but I have stuck with the web mail through the bad years. It has improved quite a bit but sometimes their Android app is an exercise in frustration. They do seem to update it frequently so most of the really annoying things have been dealt with.

For example, they just recently implemented the idea of an email not automatically downloading images and having a button to load them on demand. Seems odd to ignore such an important feature for so long.

Re: Yahoo spends $58 million to fire its chief operating officer

#94

Post by hkphooey »

stingraycharles wrote: post #82
smackfu wrote: post #50

If you're the COO, and most of your compensation is in stock or bonuses related to the stock price, and the stock nearly triples during your reign (15.92 to 41.07)... you're going to get a big payout. I also don't really buy that firing him cost this much, since much of it seems to have been a sunk cost. That stock was going to vest eventually whether he was fired or not, it just vested faster because he was fired.

This needs to be higher on top, because it appears to be a point many people are missing.

There should be claw-back provisions if an employee don't perform.

Re: Yahoo spends $58 million to fire its chief operating officer

#95

Post by kolbe »

smtddr wrote: post #64
kolbe wrote: post #57

Earlier quoted context omitted.

I don't think engineers earning six figures are relatively poor. You should learn what poor is before you say something like that. They are solidly middle class in one of the most prosperous times to be middle class. And the middle class is designed to sit between the upper (capital owners) and the lower. You're paid to augment their capital. So if they get filthy rich off of your work, despite their bad decisions, i…

>>You don't need to live in the Bay Area. You don't need the best schools. You don't need fancy new tech toys. You don't even need US. You choose to be a part of the middle class in order to receive those luxuries. I was with you until this part. You can't just tell people they don't need their current resident city or country or what schools they (or their children) need. Running away from a problem is almost never…

I'm pointing out that they're choices, not needs. They are things you can live without, and if you see a problem, and you feel strongly about changing the world, then you can sacrifice these luxuries.

And it is absurd to claim that I am advocating running away from a problem. I absolutely want you to tackle the problem head-on. But by voluntarily enriching the aristocracy, you are part of the problem. So I find it painfully hypocritical to complain about your bosses earning too much, while at the same time choosing to be their employee.

Re: Yahoo spends $58 million to fire its chief operating officer

#97

Post by fireix »

miloszf wrote: post #44
sillysaurus3 wrote: post #35

Earlier quoted context omitted.

Just that Jobs turned a company from the brink of failure to the most successful tech company pretty quickly. But since Apple is an outlier, I was interested in hearing about any other examples of CEOs who have caused big improvements in short amounts of time.

Have a look at Good to Great[0]. It's basically breaking down the qualities that make for the best CEO's, and the results are as research based as they could get, and also deliver some interesting conclusions. [0] http://www.amazon.co.uk/Good-To-Great-Jim-Collins/dp/0712676...

Then you gotta read this

Some of the companies listed went from good to great to below average to completely gone.

http://freakonomics.com/2008/07/28/from-good-to-great-to-bel...

As the author points out in the above link

"The future is always hard to predict, and understanding the past is valuable; on the other hand, the implicit message of these business books is that the principles that these companies use not only have made them good in the past, but position them for continued success."

Another example that comes to mind is Ron Johnson http://en.wikipedia.org/wiki/Ron_Johnson_(businessman)

He did great at Target and then at Apple but almost brought down JC Pennny

Re: Yahoo spends $58 million to fire its chief operating officer

#98

Post by ChuckMcM »

finkin1 wrote: post #78
ChuckMcM wrote: post #71

Earlier quoted context omitted.

Let me play devil's advocate for a minute. The guy's cash compensation, $500k. That is a about 2x what Google pays their top engineers (about $250k) The rest of his package was stock. [1] The compensation theory goes that if you do well the stock will do well, if you do poorly the stock will do poorly. So most of your compensation is a chunk of stock, in this case about 2.5M shares as "RSUs" (a restricted stock grant…

It's possible he filed an 83b election and paid taxes at the value of the stock when he received it (even though it hadn't fully vested). If so, his tax liability would be significantly less.

In this case that is impossible. If you pick through Yahoo's filing you will see that what he was granted were "RSU"s not actual stock. This is something that Google uses too. Basically the value of an RSU is nominally one share, except that it is moderated by a performance evaluation. So if your moderator is 0 then your RSUs are 0 * n or 0 shares, if your moderator is 1.0 your RSUs are worth an equivalent number of shares, and if your moderator is higher than 1.0 your RSUs become a larger number of shares. The transform happens at the actual vest time. And fortunately there is a loop hole in the stock sales of insiders that allows for them to sell as many shares as they need to for tax liability purposes.

The reason the 83b is impossible then is that he doesn't know how many actual shares this will be. But that is ok since the company sells some of the granted shares to withhold for taxes.

This scheme of 'introducing a moderator variable' gives the company exceptional leverage over the employee as they can 'take back' all of their stock grant by setting the moderator to zero.

I don't know what his contract looked like but I'm guessing it has a minimum value exit (that was used to get him to change jobs) so it would have been hard for them to not pay him any of the equity.

Re: Yahoo spends $58 million to fire its chief operating officer

#99

Post by gaius »

bronbron wrote: post #68
kolbe wrote: post #57

Earlier quoted context omitted.

I don't think engineers earning six figures are relatively poor. You should learn what poor is before you say something like that. They are solidly middle class in one of the most prosperous times to be middle class. And the middle class is designed to sit between the upper (capital owners) and the lower. You're paid to augment their capital. So if they get filthy rich off of your work, despite their bad decisions, i…

> They are solidly middle class Not really. If you earn $120k a year (just over 6 figures) you're in the top 10% of income earners in the US. The fact that you think they're 'middle class' (and relatively speaking, I don't think you're wrong) is indicative of how bad the wealth gap has gotten.

Dollar figures are useless for this; got to factor in cost of living too.

Re: Yahoo spends $58 million to fire its chief operating officer

#100

Post by bedhead »

nrao123 wrote: post #66
bedhead wrote: post #34

It's really sad how wildly distorted executive compensation has gotten. The best phrase I heard was "entrepreneurial reward for managerial duty", and I fear it's become all-too-common. My eyes popped out of my head recently when I saw that Coca-Cola (yes, that same drink company that's done just fine for over a hundred years and whose organic growth rate might be 1% if they're lucky) was trying to give management $13…

Here is Marc Andreeseen's interesting take on why exec compensation maybe high: Conventional theories of exec compensation being so high either (1) what market can bear or (2) board/mgmt agency problem out of control. Alternate theory is exec comp so high as insurance policy against catastrophic visible public failure; exec firings can be career ending. From this standpoint, top exec especially at highly visible and…

Here's my theory on it. The main problem is that companies only use one method for determining pay: comps. That's it. They just look around at peer companies and pick a number that's average or higher. It's a perpetual arms race with things only moving in one direction. One guy gets a raise? Effectively everyone does, too, because the median/mean just went up. After 30 years, the compounding effect of this becomes unimaginable.

But that's only half the problem, the other half is that using comps with respect the executive pay is boundless in practice. Think of it compared to housing prices. Home prices rely heavily on comps to help determine the market, but real prices can only go so high because there's only so much debt burden buyers can accept. Prices are effectively capped (in the short-run) by income. This is not the case with companies, particularly bigger, stable companies that are more-or-less on autopilot. Technically, the "market can bear" paying the management billions since these companies are large and profitable. It's just a skimming operation.

What we have now is people, oftentimes interchangeable and generic people (and sometimes even downright morons) making unspendable fortunes for simply showing up to work. Someone else built this thing. Other investors provided the capital. And somehow, you get Fuck-You money. There's no incentive alignment anymore.

Post reply on HN