Steve Case Recalls When AOL Almost Bought Yahoo For $2 Million

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European VC deals of the week

Today at TechCrunch Disrupt in New York, AOL co-founder (and former CEO) Steve Case took the stage to talk with Michael Arrington. He was full of interesting things to say — especially since current AOL CEO Tim Armstrong was on the stage earlier and the two just celebrated AOL’s 25th anniversary. But the funniest little anecdote from Case involved Yahoo.

People may recall that there was talk that Yahoo would buy and/or merge with AOL two years ago as Yahoo was being pursued by Microsoft. But what you may not recall is that back in the 1990s, when AOL was at the height of its power, Case actually offered to buy Yahoo. Yahoo obviously didn’t accept the offer. But they may have if the offer were just a little higher, Case says.

So how much was the offer? $2 million. Why? Because Yahoo had just two employees at that point: Jerry Yang and David Filo. This price made sense to AOL since they had just bought the early search engine, WebCrawler, in 1995 for $1 million (because it had one employee — Brian Pinkerton).

Case said that he thinks if AOL had gone to $3 million, Yang and Filo would have sold. Instead, later that year, they raised their first major rounds of funding – totaling about $3 million from Sequoia. And the rest is history (both good and bad).

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