Yahoo Inc. (Nasdaq: YHOO) made a splash when it paid $1.1 billion for the popular multimedia blogging service Tumblr Inc., but the deal was just the tip of the iceberg for the struggling Internet pioneer. Since July 2012, when former Google Inc. (Nasdaq: GOOG) executive Marissa Mayer (pictured) took the helm, Yahoo has purchased nearly 40 companies, most of them in 2013.

"At our core, Yahoo is about making the world's daily habits inspiring and entertaining," Mayer said recently. Her M&A strategy includes building on Yahoo's offerings to streamline tasks on mobile devices, such as checking news, sending e-mail, sharing images and playing games.

Prime examples include Summly, a news-sharing application, and Jybe Inc., a social recommendation site founded by former Yahoo employees. Both deals underscore Yahoo's strategy to broaden and expand expertise in the mobile segment.

Like the Tumblr deal, which brought founder and rising star David Karp into the Yahoo fold, the Summly and Jybe deals spotlight Yahoo's strategy of "acqui-hiring," or purchasing a company as a means of gaining talented engineers rather than just the technology. Nick D'Aloisio, for example, founded Summly when he was just 15 years old. Hong Kong billionaire Li Ka-Shing and actor Ashton Kutcher are two of its most notable backers.

Rockmelt was another trove of talent. The startup, which focuses on developing Web browsing technology, is noted for its creators, who are considered gifted and well-connected entrepreneurs. With that deal, valued between $60 million and $70 million, Yahoo secured Tim Howes, formerly of Netscape, and Eric Vishria, formerly of OpsWare. Both Netscape and OpsWare were founded by entrepreneur-turned-investor Marc Andreessen.

In the entertainment space, Yahoo scooped up mobile gaming developers Loki Studios as well as Playerscale, which brought aboard Jesper Jensen. The entrepreneur co-founded Super Computer International Inc., a developer of video gaming systems that was sold to Electronic Arts Inc. in 2007.

Over the last two years, Mayer has brought aboard several executives to execute her M&A strategy and nurture talent. Those executives include Jacqueline Reses, who joined Yahoo in 2012 as chief development officer after leading the media group at PE firm Apax Partners. Also, T.R. Newcomb, a former vice president at venture capital firm General Atlantic, joined Yahoo in 2013 as vice president of corporate development and now serves as head of business development at Tumblr. And James Loftus, vice president and co-head of corporate development, previously served as senior corporate counsel, M&A, for Google.

There's no question that Mayer has succeeded in attracting lots of talent to Yahoo, but it's still too early to know if it's enough to save the company. When she took the job, she said the process would take several years.

"I'm encouraged by Yahoo's performance in Q4 and 2013 overall," Mayer said at the company's recent fourth-quarter earnings announcement, reporting a 6 percent decline from the same quarter the previous year, which was in line with Wall Street expectations. "We saw continued stability in the business, and our investments allowed us to bring beautiful products to our users and establish a strong foundation for revenue growth."


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