The Hippie Values which Made Yahoo the Coolest Company in the World

"They're really a couple of anti-establishment hippies," said John Place, the general counsel of Yahoo. My colleague and I were sharing beers on a sunny, warm afternoon in Santa Clara, in the heart of Silicon Valley. He was referring to Yahoo co-founders Dave Filo and Jerry Yang. It was 1997, and I had just become employee number 258 worldwide, working as senior producer for Yahoo Classifieds. 

"Dave and Jerry might not even realize it," John continued. "They might even deny it. But so much of what they've created in this company reflects the values of the hippie counterculture, which was born here in Northern California in the 1960s."

Yahoo was founded in 1994 by Filo and Yang, who were both working on the Ph.Ds in Electrical Engineering at Stanford University. As a hobby, passion, and ultimately an obsession, they started creating a directory which placed web sites into logical categories: "Sports: Football" or "Entertainment: Music". They were having fun. They were goofing off. They were procrastinating so as not to do their Ph.D. work. They were NOT trying to start a global media empire. In contrast to many entrepreneurs today, Filo and Yang were just trying to be helpful to others.  

Yahoo became wildly popular. It was known as a "portal", or place where you start your interaction with the Web. The company went public in 1996, making the co-founders and many employees wealthy. But they prided themselves on staying down-to-earth.

Filo, I'm told, grew up on a commune in Louisiana. At Yahoo he always wore jeans and a t-shirt. Inside the building, he was often barefoot. He drove a very plain, old car, even after he had become a billionaire. He parked wherever he could find a parking spot, just like anybody else. His cubicle was legendarily messy, with stacks of papers everywhere. He kept a sleeping bag in the cube, as a reminder of when he worked around the clock, building the company. He was very soft-spoken, but the message was clear: Work hard. And keep it real.

Jerry Yang also had a sleeping bag in his cube. He was born in Taiwan and immigrated to San Jose, California when he was 10. He made a huge effort to be kind and friendly to everyone. I remember once standing at a urinal at Yahoo. Suddenly, I felt a very firm pat on my right shoulder, as I was pissing. I don't think anyone had ever touched me before while I was taking a pee. I turned to my right and saw Jerry next to me, peeing as well.

"Hey, Jim, how's it going!?" Jerry asked enthusiastically, with a big smile. He was genuine in his efforts to be approachable to everyone in the company. Everyone loved him. 

Jerry and Filo's egalitarian streak had implications for the products which Yahoo created, and the people who made those products.

The early Yahoos had a deep passion for doing what was right for the users. Creating a great product was always more important than trying to squeeze as much profit as possible out of every page. We were confident that users would keep coming back, because they got an efficient user experience, which gave them the information they needed quickly. 

Pages were designed to be as minimalist as possible -- so they could load fast, even for people with slow web access.

Yahoo innovated the Web's ability to do things better, faster and cheaper -- and "disrupt" entire industries, well before "disrupt" became an overused term. At the time, Yahoo was a massive underdog. Part of this "David vs Goliath" mentality was that the teams required to run a Yahoo "property" were shockingly small. The Yahoo Real Estate team I was on had about four people, whereas Realtor.com had about 400, and the entire newspaper classified industry employed thousands. Because Yahoo's cost structure was amazingly low and massively scalable, the company was highly profitable and our market capitalization grew from $1 Billion in July, 1997 to more than $100 Billion in January 2000.

But even when the company stock started taking off, the corporate culture viewed it negatively if you seemed to be more focused on money or title than on your desire to have a huge impact in the world. In interviewing the droves of candidates who wanted to hop on the Yahoo bandwagon in 1998 and later, if it appeared that the person was only coming to make a lot of money, then we did not hire them.

What resulted was a company of wildly passionate, often brilliant people. (What else would you expect from a company which had an "!" at the end of it's official name -- Yahoo! Inc.-- ?) Yahoo was able to be exceptionally picky about who they hired. And everywhere you went in the company -- engineering, design, PR, HR, sales, product management, legal, customer support -- you knew you were dealing with exceptionally talented people. 

Part of the hippie, "New Economy" vs "Old School", West Coast vs East Coast aspect of Yahoo was a culture of meritocracy. Tim Brady, the first hire after Jerry and Filo, once told me "Every time you walk into a meeting, you really have to be ready to defend your thinking. Because anybody at any level in the company can speak up and suggest a better way of doing things." 

But along with the passion, brilliance and meritocracy, there was a culture of fun, funkiness, and irreverence. The offices and cubes were purple and yellow -- for no other reason than those were the cheapest colors of paint available when the early Yahoos decided to paint some walls. One of the early "Surfers", (people who categorized web sites in the directory) was a guy from Virginia named Andy Gems, who kept a pet tarantula in his cube. Two other Surfers' full time jobs were to categorize porn sites. "I just broke out a new category for latex!" one of them once told me, proudly. I'm pretty sure that before Yahoo, she was in law school.

My manager, John Briggs, got the Yahoo logo tattooed on his ass the day the stock hit a $1 billion market cap. (I don't know if he got the tattoo changed when the company rebranded the corporate colors.) I loved to play music from the boom box in my cube: The Clash, Beck, The Grateful Dead, or some Cuban salsa that I had smuggled into the U.S. The producer for Yahoo Finance was across the row. The producer for Yahoo Messenger sat on the other side. The day I started at Yahoo, the company had one lawyer and two customer service people.

One of my biggest delights was when I met other Yahoos around the globe. In 1999 I travelled with my Australian boss, Tony Surtees, to Yahoo offices in London, Paris, Munich, Tokyo, Seoul, Singapore and Hong Kong. We were rolling out Yahoo Auctions internationally, in an attempt to beat eBay to market. What was amazing was how Yahoo was able to maintain and develop the irreverent, fun, revolutionary culture in all of our offices. This was really a new, emerging generation of global business people -- predecessors of today's "Techies". Together, we were redefining what was possible with technology, with a company, and with our careers. 

So Yahoo was a place which welcomed the weirdos, geeks, thrill-seekers and dreamers. What mattered was that you were obsessed with the coolness, the newness, the power and potential of the World Wide Web. To say you loved Yahoo was to say you loved the Internet. And to say you loved the Internet was to say you loved information, opportunity, equality and freedom. 

It was a magical time. It was a giddy time. And I'm deeply grateful to Filo, Jerry, and Yahoo for giving me the chance to work even once in my life at a company where we were leading our industry, changing the world, working with amazing people, making a lot of money, and having a ton of fun. 

I don't always believe in the saying "Do what you love, and the money will follow". But it was true for me at Yahoo in 1997. Long live the anti-establishment, counterculture hippies of Silicon Valley!

About Jim McCarthy

Jim McCarthy works with executives to build happy, high performance teams. He is an internationally acclaimed leadership consultant and motivational speaker. Jim’s workshops range from "operational" to "inspirational" -- often including scientific research, anecdotes, writing exercises, group discussion, action items, and daily practices. Audiences deeply appreciate Jim’s unique perspective — as a Stanford MBA, Internet pioneer, world traveler, father, and person living with a cancer diagnosis. Learn more here.