Former Yahoo CEO Marissa Mayer says spending $4 billion on Netflix — now worth more than $140 billion — would be a better ‘transformational acquisition’ than Tumblr

Marissa Mayer, former CEO of Yahoo, has regrets. Six years after leaving the role, she spoke this week about what she should have done differently.

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“We were looking at an acquisition that could be transformative, and we bought Tumblr,” she told Tech Brew.

Yahoo acquired Tumblr, a social blogging platform, for $1.1 billion in 2013 — a deal in which Mayer was heavily involved. It quickly became clear that the price was much too high: By 2016, Yahoo had seen Tumblr’s value decline by more than $700 million.

But in addition to Tumblr, the company also considered buying Netflix and Hulu.

“I think Netflix was $4 billion at the time and Hulu was $1.3 billion,” she told Tech Brew. “And either of them, with 20/20 hindsight, would have been a better acquisition.”

That’s a bit of an understatement. Today, Netflix’s market capitalization exceeds $140 billion, and since 2019, Disney has been the majority owner of Hulu.

While Mayer might have wanted her to try to acquire Netflix, the resentment runs much deeper among former Blockbuster executives. In 2000, Netflix cofounders Reed Hastings and Marc Randolph tried to sell their startup to Blockbuster for just $50 million—and were laughed out of the water.

At the time, Netflix was, of course, an unprofitable DVD rental startup by mail, while Blockbuster stores were a fixture of American life.

Today, Mayer is CEO and cofounder of Sunshine, a startup that offers an app that uses AI to organize contacts on smartphones. “We thought about calling the company Mundane AI,” she told Tech Brew. “How do we take cutting-edge AI and just apply it to everyday problems that we all face?”

Mayer shared several other regrets. She admitted that she hired the wrong person for the COO position. In 2014, she ousted Henrique De Castro, whom she had handpicked for the role in 2012, despite warnings that it was a mistake and he was overpaid.

She also said she regretted not having “done a tax-free spin-off of Alibaba,” which would have “saved or provided $10 billion for our shareholders” and “allowed Yahoo to remain an independent company.”

Three months ago, Yahoo, now owned by Apollo Global Management, said it would eliminate about 1,000 jobs and reduce its workforce this year.

This story was originally published on Fortune.com

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