Yahoo is going through a lot of changes under the new leadership of CEO Carol Bartz. Yesterday alone they launched a new version of the highly trafficked Yahoo home page and let it be known that they’re looking to sell off two of their big “non core assets” – job portal HotJobs and Yahoo Small Business, which helps SMB owners get their sites online. According to Reuters, peHUB, and a host of others, Yahoo has been proactively trying to sell off the two properties for months to no avail.
“They’ve been approached by [major buyout firms] but they’re proactively looking to sell to a strategic investor like a Careerbuilder or Monster.com,” says one source familiar with the situation, adding that the company may be looking to avoid a future embarrassment. “If a Warburg [Pincus] or a Spectrum [Equity Investors] buys HotJobs for $300 million and resells it for $500 million in two years, that’s going to look pretty bad [for Yahoo],” says this person.
If you’ve never used it, Yahoo Small Business is the hosting arm of Yahoo. It includes Yahoo Web Hosting, Yahoo Store, Yahoo Merchant Solutions, Yahoo Domains, and Yahoo Business Email. Basically, it holds the tools that many business owners have relied on to build, market and get their sites started on the Web. It’s also presents many small business owners with their first introduction to Yahoo Sponsored Search and has a small business resource center similar to the one offered by Dell.
I was surprised when reports surfaced that Yahoo may be selling the property. Earlier this week during the Yahoo Q2 earnings call, Yahoo CEO Carol Bartz commented that local relevance of both content and advertising was becoming increasingly more important to users and that capturing that market was “a big focus” to Yahoo. She then even went on to talk about Yahoo’s new partnership with Bank of America that aims to promote a small business answers center. She gave every indication that small business was a major component of Yahoo’s bright new future.
If Yahoo is so committed to focusing on local relevance and advertising, it seems odd to me that Yahoo Small Business would be on the chopping block. What better way to “capture” the local market than to give small business owners the tools they need to take advantage of what local has to offer them? Doing so educates new business owners to budding opportunities and puts Yahoo’s host of services in their line of sight when they’re making purchasing decisions.
It’s hard to say what would become of Yahoo Small Business were Yahoo to sell it. Obviously, one of the reasons it’s been so successful is because of the huge levels of traffic it sees simply by being tied to Yahoo. Without the Yahoo name behind it, much of that luster will quickly fall off. And because of that, they’ll have a very hard time selling it unless the deal accounts for it still holding on to the Yahoo name.
It’s worth noting that should Yahoo sell Yahoo Small Business, that won’t affect Yahoo Local or their local search capabilities. The two divisions are separate, it just seems odd that they wouldn’t use them to strengthen one another. If Yahoo is looking to increase local ad prominence, then throwing away the resources and tools that make it easier and less intimidating for SMB owners to get involved seems counter intuitive.
But only time will show whether or not Yahoo is able to unload both HotJobs and Yahoo Small Business onto another entity. I’ll definitely be watching to find out. If you haven’t checked out the Yahoo Business Center, you may want to take a look at some of the small business resources and guides it provides. There’s a lot of great information to be found.