00:22:53 · Jackie Reses
[00:22:53] S0: I guess just to peel back on Yahoo a bit, for those who don't know the lore and the deep history of Yahoo, what was going on at this point in time? So, it was a hot mess at this point in time. And there were multiple CEOs. There was an activist investor who had come in and demanded Alibaba be divested. And the core business was struggling at best. And it was a company that had not invested in mobile products at all. So you can imagine their apps on an Apple device, yet they hadn't really built out the quality of those apps and the breadth of those apps based on Yahoo's core product offering. And so they had mail, they had search, and they'd just done terrible search deals, where they'd basically given up the search business with what I describe as without gaining any terminal value for it. So they did a BD deal, otherwise known as they didn't sell it, so they didn't get multiple for it. And so they had to go figure out business by business how to maximize value. There was Yahoo Finance, Yahoo Sports, Yahoo Homepage, Mail. And so all of those assets needed to be shined, built more as a mobile first orientation. And then the Asian assets, so Alibaba and Yahoo! Japan, had to be sold, restructured. And in the case of Alibaba, where we were being forced to sell a huge part of the stake at a discount, my goal was to go recapture some of that equity. And so without any ability legally to go do that, I set out on a path to go try to get some of Yahoo's equity value back and pull back from some of these deals that were done before we got there. The whole thing was like a hot mess. Everywhere you look, there was like challenges across the business lines. And Marissa focused on the core business, and I focused on Alibaba, Yahoo! Japan, and then some of the deal mechanics and tax mechanics, which were, if you recall, some of the biggest challenges the company was facing around the tax bill associated with the Alibaba stake. That also, it was pretty unprecedented. I think it was gonna be one of the largest tax bills ever paid in corporate history. It was pretty surreal from a cap gains tax point of view. Okay, so the deal that you worked on, didn't that lead to 40 to 50,000,000,000 in equity value? Well, we took Alibaba public, so that yielded incredible value to Yahoo shareholders. That was a deal Jerry did.
00:25:48 · Jackie Reses
And what I ended up doing was pulling back billions of dollars of equity that we were gonna be forced to sell, that we were not forced to sell after doing different transactions, and then executing a deal between Alibaba and Alipay that helped pull back, again, tens of millions of dollars of value back to Alibaba shareholders. And so the sum value of that was pretty phenomenal. And I think it's because of the growth of both Alibaba and Alipay that we were able to recapture tens of billions of dollars of value. Was pretty unprecedented at the time. How does this then lead you to Square and Jack Dorsey? Jack's the best. So I was working at Yahoo, and out of the blue one day, I get a phone call from Jack who said, I've heard about you and I understand you run HR at Yahoo. Can you explain that to me? I was like, I don't understand this phone call. It was so funny to just get a phone call and ask about my job. And so we talked multiple times about what it was like to run HR as an operating person and not a traditional HR person. And that was a model that hadn't been used that much within Silicon Valley. And he was really curious about it because he thought that HR should have more of an operational bent to it than a lot of traditional HR leaders deployed. And I think he also trusted the function as an advisor. You know, at the time I called, when I ended up going there eventually, and I felt like I was more of an advisor than a business advisor than, you know, what a traditional HR person would do. And so he asked me whether I would come to Square. And at the time it was before the Alibaba IPO, and I didn't think I could leave before the Alibaba IPO. And so I felt like my job wasn't done at Yahoo. So I waited for the Alibaba IPO. It was amazing. Then we reconnected, and I ended up where I was in the middle of this huge tax transaction for Yahoo. There was a massive capital gains tax bill, and I was tasked with trying to solve how to manage that. And the complexity of that, again, was just unprecedented. And so I set out with lawyers you know, like five different countries to go figure out how to solve this massive tax problem. And it was a really cool problem. And when faced with something that's pretty unprecedented and hairy, like I run straight into that fire. It was like, it had my name all over it.
00:28:43 · Jackie Reses, Molly O'Shea
And so I ended up delaying the conversation with Jack again. And then fast forward to 2015, Square was getting bigger. And I ended up talking to Jack again about running Square Capital. It was actually a Hack Week project that a bunch of folks had started. And so I took over for this amazing Hack Week project and I ended up going to run literally this thing that had started. It had 10 colleagues that were pulled together from like the risk team and the finance team and an operating team. And I pulled the team together and ended up going and building what became Square Capital, and then Square Lending, and then Square Banking, and it became a pretty broad base of financial services products. And so it was a really cool idea. I also love that it was a Hack Week project. And anyone who gets to go build something from Hack Week project, I think that's kind of cool to see it turn into this huge multibillion dollar business. [00:29:53] S1: That's pretty intense. Wow. So in terms of the origins of Square, I know you also leaned into crypto when no one else was doing that. So why did you decide to do that?
00:29:53 · Molly O'Shea, Jackie Reses
[00:29:53] S1: That's pretty intense. Wow. So in terms of the origins of Square, I know you also leaned into crypto when no one else was doing that. So why did you decide to do that? [00:30:10] S0: So Square leaned into crypto very early on, and that was really Jack's brainchild. He had a vision for Bitcoin trading that he wanted to see executed. And in the way that he and a team started Square Capital, he and a team of three engineers sat down on a Thursday and wouldn't leave the office until Friday night. They coded the system. And I actually sat alongside of them for part of it and did whatever I could to be helpful. And I felt like I was their pizza orderer, their comedy routine, their breath of fresh air, and just someone to coach them and be happy to cheer them along. And so Jack wouldn't leave the office until that product was launched. And so he sat there for a few days and made that happen. [00:31:10] S1: So Square was one of the first fintechs to lean into crypto when it was still a little taboo. Well, it was a little hype y, honestly, [00:31:17] S0: in the crypto world. Yeah. Well, kind of. It was edgy. [00:31:21] S1: It was edgy. [00:31:21] S0: Super edgy. [00:31:23] S1: What was going on there and why
00:31:24 · Jackie Reses
[00:31:24] S0: did you lean into it? I love this story because it's all Jack. The amazing part about Square and its crypto origins is that everything about it was Jack's personality. Jack Dorsey just decided that he wanted to have a crypto product. He wasn't waiting for anyone. He wasn't going to deal with anyone's objections. He was just going to go get the job done. He took three engineers, and he sat at the corner of the 6th Floor at 1455 Market and didn't leave the office for three days. And so everyone sat there, he included, and they coded up the crypto trading platform. And so on Friday night, when they finally were able to trade, it was like the moment that they all left the office. And my space for Square Capital was right next to where they were sitting. I love the group of people who were doing it. It was a very small group that I happened to be close with. I was more than happy to light up the space and keep smiles on their faces. And so I just thought it was the coolest thing that in January 2017, they were gonna launch this crypto product. And then the chaos starts, which is you're a public company and you wanna launch a Bitcoin product, but there weren't really public companies that had Bitcoin. And so you have like accounting implications, which is a really weird thing. You have SEC implications. So you have to take this idea to the SEC, but no one knows how to account for it. And so that is whack a doodle, right? You're trying to go then explain what kind of accounting it should be to your accounting firm. And so we almost got held up that first quarterly earnings period because we couldn't get accountants in the SEC to agree that we were accounting it correctly, and then actually get it in the numbers in order to launch the product. And we weren't gonna wait another quarter to make that happen. We were just anxious to release the product. And so I think everything about that experience just screams Jack Dorsey and his personality on steroids because of the energy and the creativity and the bombastic nature of the way he wanted to go get this product into the world.
00:33:51 · Molly O'Shea
[00:33:51] S1: What are his key leadership traits? I know you just mentioned a few, but like, what