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How Yahoo Sponsored search became a billion dollar project?


Table Of Contents:

Yahoo! is an American web services provider. Its headquarters are in Sunnyvale, California, and operated by the namesake company Yahoo Inc. . 90% of it is owned by investment funds managed by Apollo Global Management and 10% by Verizon Communications. Yahoo provides a web portal, search engine Yahoo Search, and related services, including My Yahoo!, Yahoo Mail, Yahoo News, Yahoo Finance, Yahoo Sports, and its advertising platform, Yahoo! Native.

Sponsored Search Model Idea:

In 2001, Scott Gatz, an established creator at Yahoo, suggested the concept of using a sponsored search model instead of the established directory-style search. He was then the general manager of Yahoo search and when he pitched the idea, he felt confident that he’d be put in charge of the new venture. But his boss at the time, Chief Products Officer Tim Brady, asked VP of Search Jeff Weiner to oversee the project instead.

Gatz, who had led teams of 30 to 40 people, felt he’d been leapfrogged.

“I took umbrage with it. I thought – Hey, this is my idea, so why would I bring in this outsider?”

But as the project progressed, Gatz realized that he would have been in over his head if he’d been given the post.

“The sponsored search project involved managing hundreds of people and running a business making multiple hundreds of millions of dollars — eventually billions. I didn’t have the experience to handle that at the time.” –  Scott Gatz

Weiner’s experience, particularly in managing larger teams, turned out to be a huge asset. Scott was later thankful for Weiner’s management of the project. He also added he felt ready when the next project came to him.


Yahoo made billions of dollars using the concept of the sponsored search model. This would not have been possible had the project not been managed well, by someone with the required experience. Often times, in organizations, those who come up with the ideas might not be the ones who take them through implementation.

An idea, with tons of potential, often goes through the entire project management lifecycle and it requires an entirely different skillset to carry it right to implementation. The above was true in the case of the sponsored search model and it happened for the best.

If it ever happens to you, where you come up with an idea and someone else gets to implement it, you ought to know it’s for the best for you and your brainchild.

We have stories on our blog how some ideas set example of innovation that you may be interested in. Or you can download our free ebook “The Power of Employee Innovation” Feel free to check out! 

Read Next: 15 Idea management software to facilitate innovation in your organization

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