Yahoo in a paragraphYahoo essentially invented the online-advertising business. In 1994, two graduate students at Stanford, Jerry Yang and David Filo, dreamed up a way to help early users navigate the web. They picked URLs that they each liked — beginning with around 100 links, including one for Nerf toys and one dedicated to armadillos — and listed them on a page called “Jerry and David’s Guide to the World Wide Web.” Within a year, their guide had to be divided into 19 categories (art, business, etc.) and was generating one million clicks a day. In 1995, the year Yahoo started selling ads, a former company executive estimated that the entire market was about $20 million. By 1997, Yahoo’s ad revenues alone were $70.4 million. The next year, they were $203 million.To keep up with the growth, Yahoo quickly expanded beyond its directory to create a multitude of ad-supported products. The company aimed to be all things to all web users, and for most of a decade, it was a wildly successful strategy. In 1997, Yahoo added chat rooms, classified ads and an email service. In 1998, it introduced sports, games, movies, real estate, a calendar, file sharing, auctions, shopping and an address book. Even during the crash of the Internet bubble, a profusion of more traditional advertisers began to migrate from print to digital. The search business, in particular, was growing enormously. In 2002, Yahoo’s first full year monetizing search results with attendant ads, its revenues reached $953 million. In 2003, they eclipsed $1.6 billion. In 2004, they grew again to $3.5 billion.