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Yahoo! Inc. (YHOO) Needs To Raise Its Self-Esteem, Not Revenues

It’s strange how people perceive that change should come from external sources rather from within. Yahoo! Inc. (NASDAQ:YHOO)’s Marissa Mayer has been desperately trying to save the company from hitting rock bottom, but apparently the wrong way. We’ve seen a series of more and less successful purchases performed by Yahoo! Inc. (NASDAQ:YHOO) that didn’t turn up to be money well spent. However, the company thinks that it just might be the time to spend some more, according to Bloomberg.

Yahoo! Inc. (NASDAQ:YHOO)

“Yahoo is close to investing in mobile app Snapchat, according to a person familiar with the situation. Yahoo! is the lead investor in the financing and set the terms of the funding round. The Los Angeles-based start-up is being valued at $10 billion,” announced Anna Edwards.

It’s difficult to comprehend what exactly is Yahoo! Inc. (NASDAQ:YHOO) looking to accomplish through this latest move, especially considering that the funding is around $20 million, or as much as one fifth of a percent of Snapchat’s estimated valuation. There have been given no more comments or details on the deal. Probably, Yahoo! Inc. (NASDAQ:YHOO) is trying to assure some competitive edge in mobile, but this would require more serious spending, of which the tech dwarf can’t afford much.

Snapchat is a messaging application developed by three Stanford University students that allows users exchange self-deleting videos or pictures. This tiny piece of software working on iOS and Android is catching up in popularity with other renewed applications. What makes it such an attractive business element is that sending a short video or a picture (snap) will result in a push-notification on the recipient’s phone. This type of connection can give different brands the possibility to reach their customers directly with an overall impression of delivering exclusive content.

Yahoo! Inc. (NASDAQ:YHOO) might benefit if this relationship roots in the advertisement business, but it’s not that clear how it will happen. Let’s just hope that there’s some New Year surprise being prepared by Marissa Mayer, maybe next year she will start changing the company from the core, not just aesthetically.

Disclosure: none
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