Oh, just look here, via this cool infographic from MBAOnline:

Here’s the deal for new Yahoo CEO Scott Thompson, who left a job running eBay’s PayPal:

Annual pay: $1 million.

Bonus (if he’s very, very good): $2 million.

Bonus (even if he’s not): $500,000

Stock grant: $11 million.

One-time inducement grant: $5 million.

Make-whole cash bonus: $1.5 million

Make-whole restricted stock units: $6.5 million.

Shareholder horror if it doesn’t work this time: Priceless!

Oh, just read it for yourself:

YHOO-20120106-8K-20120103

Yahoo shareholders felt a little giddier earlier this week, when it seemed as if the company had finally decided to make a deal with its Asian partners.

But the happiest crew might end up being the Silicon Valley Internet giant’s outside counsel, Skadden Arps — and especially Leif King, the fantastically named legal eagle who has been advising Yahoo on the deal.

That’s because today the Yahoo board approved continuing the negotiations to come to a final agreement over the stake, sources said, which should take six to eight weeks.

It’ll surely be happy holidays for billable hours!

As costly as the legal bills will be, if it all goes well, an Asian solution will mean one major problem solved, with a possible pile of cash and new assets coming in to Yahoo.

To get there, the company signed a term sheet earlier this week with Japan’s SoftBank to sell back all its holdings there, and with China’s Alibaba Group to sell off more than half its stake (moving from a 40 percent stake to a 15 percent one).

The deal values Yahoo’s total shares in both companies at about $17 billion.

While it gets a pretty accounting name — “cash-rich split “– the vehicle to unwind it all is essentially a complex tax dodge finally cooked up by the trio, in which cash, new assets and stock will be moved around until everyone gets what they want (except the U.S. government).

I would explain it — but I am on vacation, and would rather drink eggnog and sleep — so here is The Wall Street Journal’s version, which I like because it sounds like Alibaba and SoftBank are giving Yahoo a hugely loaded Starbucks card for Christmas:

“As envisioned in the scenario, Alibaba would create a subsidiary into which it would put several billion dollars of cash, plus an operating asset that Yahoo wants to buy using additional cash from Alibaba, almost like giving Yahoo a prepaid card for an asset of its choice, the people said.”

Everyone is hoping there will not be any hiccups in the deal, which has been spearheaded by Yahoo board member and Intuit CEO Brad Smith, and Jerry Yang, who is also the company’s co-founder and a major shareholder.

Alibaba CEO Jack Ma and CFO Joe Tsai, both co-founders of that company, were the point men for the Chinese company. And for SoftBank, it was its founder and CEO Masa Son and his main U.S. exec, Ron Fisher.

Now, said sources, Yahoo’s board is hoping to still keep the bids from a pair of private equity firms — Silver Lake and TPG Capital — alive.

While initially the focus on the action, the PE bidding for partial Yahoo stakes has recently been sidelined by the Asian deal.

Now, sources said, Yahoo is hoping the new infusion of cash and assets will allow it fend off shareholder unrest — stock buybacks and dividends, anyone — to solicit higher prices from the firms to make strategic investments.

Yahoo had considered the initial bids too low, as did some very pissed-off activist shareholders.

Still, it’s not clear if those firms will jack their offers now, although sources said Silver Lake is still interested in some sort of deal that would give it influence over remaking Yahoo.

Silver Lake and others think the long-troubled company could be revived with some effort, and become a much more lucrative Web property.

But those negotiations might run into roadblocks over who gets to pick leadership for the company. Yahoo has accelerated its efforts to hire a new CEO, after firing Carol Bartz in September.

The PE firms, who would buy a large stake in Yahoo, also have wanted some level of control, including CEO and board approval, in order to be able to make massive changes at the company to turn it around.

Wall Street seems to like the Asian part of the deal, at least, since it shows some sort of forward momentum at Yahoo, and from its often-lugubrious board.

Shares are up almost 7 percent in the last few days, although they are not popping as they might be, given that new valuations based on a successful Asian deal put the stock at a much higher price.

In other words, investors like what they see, but are watching and waiting for more.

I’ve asked Apple for input; last week, when news of the potential deal first surfaced, the company declined to comment.

If this is a done deal, it would follow an M&A pattern that Apple has pursued for some time. Though the company has enormous cash reserves, it has generally made smallish (by its standards) deals for technology vendors it is already using — in this case, it is using Anobit’s flash memory chips in its iPads, iPhones and MacBook Airs.

But Apple spends much more cash — billions a quarter — locking up inventory for the raw components than it uses in its gadgets, like flash memory or display screens.

Revolution Growth, a new investment vehicle led by former AOLers Steve Case, Ted Leonsis and Donn Davis, has raised $450 million in their first investment fund.

Originally, as I reported in March, the growth fund was going to be $400 million, but more was added due to investor interest.

The figure is a large one for a new venture and includes two dozen limited partners.

According to a letter to its partners, which I posted below in its entirety, Revolution said it will make 10 to 12 investments over five years in the consumer space of about $25 million to $50 million and mostly on the East coast, where its principals live and work.

The fund will focus on the “speed-up” stage — which is apparently just past venture stage and not yet in growth.

While both Leonsis and Case have done a lot of investing in the Web 2.0 space both together (Revolution Money) and apart (the Groupon and LivingSocial social buying sites, respectively), this is the first time the pair of well-known Web pioneers are creating a more formal investment partnership.

The pair are also investing $75 million of their own money in total in the Revolution Growth fund.

Revolution’s three partners said they will also be deeply involved with entrepreneurs at its companies.

“We are not just investors, but former CEOs and business builders who have the expertise and passion to be actively involved with the companies we back,” said the letter. “By making only a few investments each year, we will have the time to really help the entrepreneurs with whom we partner.”

Well, you can read about the Revolution Growth fund yourself here:

letter

Clearspring, the social-sharing company — in an effort to increase its business as a marketing analytics player — has acquired XGraph, a data science company.

Clearspring declined to provide the price it paid for XGraph, but said the deal was in cash and stock. The start-up raised $3.75 million just over a year ago.

The combined company has 85 employees — 70 at Clearspring and 15 at XGraph.

Execs at the the McLean, Va.-based company said the purchase will increase value to advertisers and publishers via audience targeting and data science. Clearspring is best known by consumers for its AddThis social-sharing tool, which provides a lot of detailed user data.

Clearspring raised $20 million in funding in May. At the time, the company said it planned to spend its new cash on acquisitions that leveraged data and built audiences more efficiently.

The New York-based XGraph focuses on modeling and monetizing the Web’s social graph.

“We get a lot of data points every day and making sense of them is something we have already been doing, but XGraph fits the bill to go even further in the multi-graph use of data,” said Clearspring CEO Ramsey McGrory. “It puts us in a position to be the market leader for the application of data.”

Key Compton, CEO and co-founder of the three-year-old XGraph, noted that the industry has become data-driven in new ways.

“People are connected to each other via social connections in a multi-graph platform,” said Compton. “I think there are some really interesting opportunities to access the data.”

Here’s the official press release for the deal:

Clearspring Acquires XGraph to Create Largest Multi-Graph on the Open Web

Company accelerates growth by deepening data team and technology

McLean, VA and New York. NY. — November 1, 2011 – Clearspring, provider of the largest social sharing and analytics platform, AddThis, announced today it has acquired XGraph, Inc., a leading data science company focused on modeling and monetizing the web-wide social graph. Clearspring’s massive reach and proprietary real-time data processing capability, coupled with XGraph’s audience technology, create the largest multi-graph platform on the web — mapping 1.2 billion user’s connections by brand affiliation, intent and social behavior.

The investment in XGraph’s data science capabilities marks another step on Clearspring’s rapid growth trajectory. XGraph’s team has deep data science expertise with applied backgrounds in advertising, sociology, mathematics and computer science. Their unique technology dynamically organizes users by shared connections and interests. XGraph’s team and platform will drive Clearspring’s existing efforts with publishers, advertisers and agencies forward while also setting the stage for new innovation.

“Clearspring is at the epicenter of two major shifts online — the web becoming social and personal, and advertising becoming data-driven and accountable. The common thread in both changes is data. To compete in this new world, companies will not only need the ability to access and process big data, but also have the ability to activate that data to create value for consumers, publishers and advertisers,” said Ramsey McGrory, Clearspring’s new Chief Executive. “The combined company has the people, technology and data to enable our clients to stay at the forefront of these changes. 2012 will be a breakout year for Clearspring.”

For advertisers, agencies and trading desks, Clearspring will immediately be able to provide the largest multi-graph audience targeting capabilities available on the open web. By using this technology to identify a brand’s core audiences and finding millions of other connected and like-minded people online, the company can now drive more efficient spending and increased campaign performance. Clearspring also plans to leverage this new capability to deliver publishers unique audience insights, monetization capabilities and actionable data products in the coming year.

“Most companies only capture one dimension of how we’re all connected, whether it be our friends or people we share with — a single graph approach. XGraph not only models these social connections, but also multiple other types of connections such as brand affiliations, intent and more — a multi-graph approach,” said Key Compton, XGraph’s CEO. “We’re truly excited to leverage our technology to unlock the value of Clearspring’s massive data set and help publishers and advertisers truly harness the power of the web-wide interest graph.”

XGraph is headquartered in New York with an office in Silicon Valley. All XGraph employees based in New York will join Clearspring’s office there. Clearspring plans to keep the office in Silicon Valley. The combined company will have 85 employees nationwide.

You gotta hand it to those geniuses over at the Googleplex, thinking up adorkable names for all their various plots and schemes.

And for its latest look-see of the Yahoo situation, it has revived an old one: “Project Porcupine,” presumably from the old joke about how you hug a porcupine.

Very carefully.

Or maybe you don’t hug it at all, which is why all the rumors about the search giant hooking up with some unnamed private equity firms have been so unclear and, well, hard to grab ahold of.

According to sources, there are three clear aspects of what is actually going on:

1. Interest in using Google’s vast cash hoard as part of an investment it would make in a deal — meaning the company was approached, which it is, often.

2. Desire of Google’s crafty Chief Business Officer Nikesh Arora to perhaps find a clever way to get ahold of Yahoo’s display inventory to add to Google’s own fast-growing DoubleClick display advertising subsidiary — meaning Arora has been making the rounds at Yahoo to gauge interest.

3. Pure enjoyment in messing with Microsoft execs — who are now allied with Yahoo via its Bing search technology — as well as getting up any price the software giant would have to fork over to be part of any consortium that will be cobbled together in what is sure to be a hopelessly complex deal.

Whether incoming or outgoing or just an early version of Mischief Night, any one of these options — while interesting to contemplate — is certainly fraught for Google.

Remember the trouble three years ago when Google tried to do a simple search-advertising partnership with Yahoo, in order to pull it out of the clutches of Microsoft?

That effort ended with a resounding oh-no-you-don’t by the Justice Department, which promised an antitrust lawsuit was awaiting such a move to bring together the No. 1 and No. 2 search services.

And if it was a no-no then, any formal relationship or even arm’s-length investment in Yahoo by Google would inevitably be more closely scrutinized this time around.

In fact, what I wrote in 2008 applies a dozen times more emphatically today:

“It is bad for advertisers, it is bad for consumers, it is bad for innovation, no matter how well-intentioned Google is.”

Fast forward to today, after Google has already played a worrisome game of chicken with regulators over a number of acquisition deals — which makes trying to bring back Yahoogle akin to reaching for the third rail.

But that’s not what it’s going to do, in truth, because — even though Yahoo is still a tempting target — there is usually only one outcome to hugging a porcupine.

Ouch.

After his unusually enthusiastic declaration at a Silicon Valley event last week that “we are very, very interested” in buying the “whole” of Yahoo, you might imagine Alibaba Group co-founder and CEO Jack Ma running out of the speech looking for a giant pile of cash to pay for it immediately.

Instead, according to sources close to the situation, what the Chinese entrepreneur got was a cold dose of CFIUS — or Committee on Foreign Investment in the United States, the federal interagency review process for foreign investment deals.

Translation: If you are from China and want to buy our U.S. companies, we are going to have to give you a major look-see and it is not going to be pretty.

Perhaps that’s fair, but the prospect that even a purchase such as Yahoo, a consumer business that seems to have little in the way of national security concerns, might enter the buzzsaw of U.S. politics apparently surprised Ma.

Thus, sources said, that while it remains very interested, Alibaba is now at least a little concerned about the feasibility of the deal and that Ma is “perplexed” about why the U.S. has such restrictive rules against foreign ownership of a consumer business.

That said, he has been in touch with Yahoo co-founder and board member Jerry Yang and is likely to make a more official visit soon with others involved in Yahoo’s strategic review.

In addition, sources said, rumors of an imminent Yahoo bid hook-up with DST Global and Silver Lake — which recently invested in Alibaba — are overblown. While Ma did say last week at his much-noticed speech at Stanford University that he was talking to a lot of buyers, Alibaba is not closely aligned with anyone as yet.

Of course, given that Yahoo owns a 40 percent stake in Alibaba, Ma will be a big player in any deal done.

That’s because of a 2005 agreement that stipulates that if there is a change of control, Yahoo must give Alibaba a 15-day chance to buy back its stake.

Still, after his effusive I-want-Yahoo-now speech that caught the Internet giant and its bidders off guard, dialing back the rhetoric a bit is probably no surprise given the delicate dancing now going on.

In other words, a case of wanna-be-buyer’s remorse.

Critics suggest that using a credit card at the register is not much harder than using a phone enabled with near field communication. But if you are having a hard time understanding, maybe it’s because you are getting too old (sorry if I’m the one breaking it to you).

In an interview, David Messenger, American Express’s head of online and mobile, tells me they have identified a major pain point among teens and others who are still using cash and checks to conduct a majority of their transactions.

Dozens of companies are rushing into the space, including eBay-owned PayPal, American Express, Google, Visa, Mastercard and start-ups, too, like Square and others, but it’s not clear how quickly consumers will find reasons to use new payment technologies.

“The key thing that we’ve found resonates is the social aspects,” Messenger said. “This is about new growth opportunities and people who use cash and checks. … It’s the social experiences that don’t have great solutions. It’s awkward.”

Messenger also sat on panel yesterday at Mobile Future Forward in Seattle to discuss the topic with other executives from Google, Walmart, T-Mobile USA and OpenMarket.

The conversation got heated when a woman raised her hand to say she didn’t understand why she would ever adopt mobile payments: Seriously, how could a phone be easier than swiping a card?

Walmart’s SVP of online and mobile, Gibu Thomas, explained that the discount retail conglomerate would never pressure users to adopt it, while T-Mobile Chief Strategy Officer Peter Ewens defended the technology by saying that it improved security.

But Messenger said in an interview to me that the bigger opportunity is in the international markets, and for now it’s focused on teenagers in North America, who struggle in social settings.

He said the benefits are obvious when splitting a check at a restaurant, divvying up rent and utilities among five roommates every month, or being the person who fronts the money to buy tickets to a concert for a group of 10. Those transactions today are largely conducted with cash and checks.

Earlier this year, American Express unveiled a new business called Serve that competes with PayPal and other emerging payment platforms. It lets consumers make purchases at retail, withdraw cash from ATMs and make person-to-person payments from their computer or their phone.

Serve recently inked a deal with Ticketmaster to be integrated into the check-out process. People frequently abandon the purchase at the check-out in fear that their friends won’t repay them the hundreds of dollars owed for a concert or sports event.

Once Serve is integrated, he said, Ticketmaster will hold the tickets for a certain period of time and send an email to friends, alerting them to pay directly for the ticket. At that point, it’s simple: If they don’t pay, they won’t go.

American Express is also experimenting with using social networks by creating a Facebook application called “Pay Me Fool,” which uses humor as a way to make it more comfortable for someone to bug a friend to pay them back for beers last weekend.

For now, Serve mostly works as a prepaid card, but in the future, the platform could be used in conjunction with NFC or other emerging technologies. Messenger said they aren’t ruling anything out and are trying to be as open as possible.

The card can even be topped off with a Visa or Mastercard.

But right now, Messenger and the other participants on yesterday’s panel agreed on one thing: NFC is still about three years away from hitting the mainstream. It will take a while for users to get NFC-enabled phones and for retailers to have NFC-enabled payment terminals.

“NFC gets a disproportionate amount of attention,” said Messenger, who attributed the fixation to our “gadget-driven culture.”

A look into his wallet suggests how far the industry is from any major changes. Messenger’s thick leather wallet contained cash, a Connecticut driver’s license, 10 loyalty cards and five credit cards, including two from American Express, one from Serve and two from Mastercard.

However, I’ve found that asking mobile payment executives what is in their wallet is far from a window into the future.

Messenger said most importantly, the prepaid product addresses a whole new segment of the population that its corporate-heavy image would not normally attract. He hopes new types of commerce models will flip its business upside down.

For example, today, Amex markets heavily to acquire new customers and then keeps existing users happy by offering them rewards. He suggests that Serve will make it much easier to acquire new customers because of partnerships, such as the deal with Ticketmaster or another deal it has with Verizon Wireless. From there, he said, they will have to keep giving Serve users reasons to come back.

[image via if-youcantsleep.tumblr.com]

In the last month, the stock of AOL has declined just over 50 percent.

But that drop is not just due to the turbulent markets of late. AOL stock had a 50 percent drop over the last six months, a 57 percent decline since the beginning of the year, and a 56 percent plunge since it went public in late 2009.

Which is why some in the industry — at private equity firms and bigger companies — have noted to me that the price of AOL might have gotten low enough for a very cheap takeover.

“You have to look, even with all the problems they have been struggling to fix,” said one person, who also underscored the advertising and other challenges that AOL faces. “But it is so inexpensive, it’s also an interesting idea.”

Said another large investor: “It’s almost free, given its cash on hand.”

Indeed, since in its recent second-quarter earnings report, AOL said that, as of June 30, it has $458.7 million in cash.

That matters, since at $10.22 a share — a far cry from its $28.45 high of all time in late April of 2010 — the market valuation of the New York-based Internet giant is only $1.09 billion.

You do the math.

To give that number perspective, AOL paid out $315 million in cash to buy the Huffington Post in the beginning of this year. And, let us not forget, under different management, AOL forked over $850 million in cash to buy the Bebo social network in 2008, and sold it for a song last year.

Even AOL thinks the price is low, announcing a $250 million stock buyback program this morning, just as shares hit their lowest point ever yesterday.

The stock is up today, though still in the basement.

To be fair, comparable companies’ valuations have also taken a hit recently. Yahoo shares are down 29 percent since the beginning of the year, giving it an affordable $15.3 billion valuation; and Demand Media’s stock has dropped 63 percent in that period, making its current price tag only $703 million.

Calling all shoppers?

Yahoo — which turned in yet another disappointing second quarter on Tuesday, but with all new excuses for the continuing decline in revenue — is now getting toasted by Wall Street.

That would be the marshmallow — and not the champagne — kind.

The stock of the Internet giant dropped below $14 a share, to close at $13.48 yesterday, after the company said its display advertising business in the U.S. was hard hit.

Today, it’s already down even further.

That’s close to an eight percent haircut for the past two days and a decline of 20 percent for the past three months.

In that same three months, Google is up over 13 percent, Microsoft is up over five percent, Amazon is up over 17 percent and Apple is up 13 percent.

You get the general idea here.

The decline means Yahoo’s market value is now only $17.5 billion, and more than two-thirds of that value is accounted for by its Asian assets (more than $9 billion) and cash ($3.3 billion).

That means its other properties are worth just above $5 billion now.

And while CEO Carol Bartz tried again — in a conference call with analysts after the earnings were released — to portray the situation as another part of her never-ending turnaround of the company, the issues at Yahoo are not new.

They range from display weakness to search declines to a talent drain to ineffective marketing to the lack of a consistent and fast-developing pipeline of innovative products to its flaccid board.

The earnings mess — no surprise, given estimates going forward were also missed — was seized on by investors and the press. (See, it’s not only me!)

In a column earlier this week in Forbes, titled “Carol Bartz’s 8 Blind Spots That Sunk Yahoo,” longtime and noisy Yahoo critic Eric Jackson noted:

“[T]he Bartz hiring is a cautionary tale to all boards and investors: An over-confident ex-CEO with no industry experience can make a bad company worse before things get better.”

But perhaps more damaging was a post today in The Wall Street Journal’s Heard It on the Street column by Martin Peers, titled: “Yahoo’s Unsurprising Surprise.”

It began with the cutting line: “Talk about having a credibility gap on display.”

Then it got worse:

“Admittedly, it may be that Yahoo has dropped off the radar screens of so many investors that this latest episode can’t do further damage. Certainly, aside from cutting costs, Ms. Bartz’s turnaround plan for Yahoo remains stillborn.”

That might be too kind if the stock continues to decline, a development that — in turn — might once again begin the speculation of Yahoo as a takeover target.

Which, if that could manage to get Yahoo shares back up, might be a reason to break out the bubbly.

A Yahoo spokeswoman declined to comment, which — given stock prices are what they are — is probably a good idea.

That’s the question I asked some digital money experts, whose job it is to push the creative boundaries on payments.

So, having captive reps from some of the key companies — BOKU, BilltoMobile, Intuit and Tapjoy — involved in leading the charge to do away with cash and plastic, I wanted to know what they carried around daily.

And — given I was moderating a panel for the MobileBeat 2011 conference, titled “The Likely Winners In Mobile Payments: Carriers, PayPal?” — it seemed like an appropriate query.

You’d think they would be on the cutting edge, right?

Wrong!

In fact, two of the panelists were still carrying around checks; one had dozens of credit and debit card options from banks around the world; and two were even carrying business cards from their previous employers, because they believed they could get discounts at rental car agencies.

Only one had a digital wallet.

That was Steve Klebe, VP Business Development & Strategy, BilltoMobile, who actually had an NFC-enabled sticker on the back of his phone, which was connected to his Discover account. But he’d only used it once.

It was also Klebe who carried around a blank check, in case of an emergency. Ron Hirson, BOKU’s SVP Product & Marketing, also had the kind of money that folded — a $50 American Express travelers check.

Remember those?

Omar Green, Intuit’s director of strategic mobile initiatives, had the biggest wallet — bursting — with a giant pile of cards stuffed in it. Deng-Kai Chen, director of product management at Tapjoy, easily won for carrying the lightest wallet — he claimed it was bad for your back if you sat on anything bigger in your pocket.

Everyone also had a variety of loyalty cards, photos, receipts and transportation passes.

What about me?

As the solitary female representative at the table I was the only one with coins, including about $2 in pennies (because I’m too lazy to ever spend them). I also probably had the most cash — around $28, mostly in $1 bills.

So how close are we to a mobile wallet revolution?

Judging by what was in our wallets, you might want to wait a while.

Photo Credit: allie.

So exactly how fecund is “FarmVille”?

If reports hold, we’ll all find out today what the yield is from the online gaming phenom Zynga, which will finally be filing its regulatory documents sometime today.

The S-1 for a public offering valued at up to $20 billion, which will contain all kinds of juicy information about the San Francisco-based start-up’s business, is likely to come out after the markets close. Zynga is expected to raise $2 billion in the offering.

Before everyone gets to see what’s in it, there’s a lot that investors should be looking out for, based on recent IPO filings by similar companies, such as Groupon.

Digging Up New Accounting Ground

As Tricia Duryee pointed out, Zynga will be the “first major U.S. company supported primarily by the sale of virtual goods” to file.

That’s what will likely make the Zynga filing very interesting, from an accounting point of view.

How Zynga handles its accounting is sure to be much scrutinized, especially since Groupon attracted all kinds of ugly from its unusual treatment of its financial results.

To defocus from its money-losing under GAAP acounting, the Chicago-based social buying service used the more attractive “Adjusted CSOI,” which is defined as adjusted consolidated segment operating income.

My definition: Sketchy!

Zynga’s finances are expected to look better, reportedly generating about $400 million in profit last year on about $850 million in revenue.

It will be important to pay attention to the breakdown of those revenues and about what period of time the company accounts for them.

As Duryee wrote, Zynga has several choices:

Game-based model: The company recognizes revenue over the life of the game.

User-based model: Revenue is recognized over the estimated life a user plays the game.

Item-based model: Revenue is recognized based on the implied or explicit life span of the item — in other words, how long it would last in the real world. Examples of more durable goods are virtual vehicles, furniture or weapons. Revenue from these would be recognized for as long as the player stays active in the game. Revenues from a more consumable item, like a virtual cup of coffee or a jolt of energy, would be recognized almost immediately.

And there are still other factors to take into consideration, such as whether the goods were paid for with virtual currency or real cash, and how much information a company has for establishing the averages.

In the Revenue Weeds

Another interesting thing to study will be the revenue breakdown for Zynga, especially as it relates to its biggest platform provider, Facebook.

Such as: How many in-game items are purchased directly on Facebook versus through gift cards purchased in the store? How big (or small) is Zynga’s advertising business? What about mobile games? Will the profitability of individual games be called out, with details about their performance?

And, of all its various distribution platforms for its games, where does it get the most mojo?

That’s important, since Zynga will be seen as a proxy for Facebook’s business. Thus, a lot of investors might find some nuggets of information, since the pair are so tightly intertwined as businesses.

Facebook, of course, has been famously trying not to IPO, so any indication of the social networking site’s business will be carefully studied.

Reaping the Insider Rewards

Lastly, it’ll be important to see who is selling what and when among current Zynga investors.

Groupon ran into a buzz saw of criticism from the giant payouts its founders took out of the company from its massive venture funding rounds.

As Peter Kafka wrote:

Groupon raised a total of $946 million in two funding rounds last winter. It kept $136 million of it to help run the money-losing company. The remaining $810 million was paid out, via stock purchases, to CEO Andrew Mason and some of his backers, including Eric Lefkofsky, and, notably, the Samwer brothers, who sold their CityDeal company to Groupon in 2010 … Of note: This wasn’t the first time Groupon had raised money and taken cash off the table. In April 2010, the company raised $130 million, and handed $120 million to many of the same people.

My definition: Even sketchier!

Along with its founder and CEO Mark Pincus, Zynga investors are the pantheon of venture players, including Digital Sky Technologies, Kleiner Perkins, Union Square Ventures and angel investors LinkedIn founder Reid Hoffman and Peter Thiel.

How much Pincus and others inside the company have taken out and are selling should be one of the first places new investors should look.

Because with the hyped valuations that many of these Web 2.0 companies are getting, who’s zooming who should be a key sign to pay mind to.

Talking to AOL CEO Tim Armstrong earlier this week about its investors day tomorrow, he used the word “execution” a lot.

No, not the kind evoking a firing squad if he did not succeed at turning around the New York-based Internet giant soon as he has long promised.

Instead, Armstrong was referring to reassuring big shareholders and Wall Street analysts that AOL was now in a mode of making sure all its many moves to turn around the company will finally begin to pay off.

“Basically, our point is going to be about fully operating around the strategy we’ve built,” said Armstrong in a wide-ranging interview. “It seems right for investors to ask about executing on what we have been doing for the last year and a half.”

It’s certainly the right message for the charismatic executive to be delivering, as he and other top AOL execs present their plans moving forward, especially after what has turned out to be a very hyperactive year.

After deep layoffs, a massive rejiggering of its management ranks and a number of shifts of its business focus, without much advertising increase to show for it yet, Armstrong has also pushed through a series of acquisitions.

It culminated in the high-profile and decidedly dramatic purchase of the Huffington Post in January for $350 million in cash.

Now, said Armstrong, deals will be taking a back seat to products.

“We are diligently staying on strategy and really focusing on products and services,” said Armstrong. “We have laid out the path we are on and now investors want proof of the concept.”

To Armstrong, that means the push of “branded content” and a continued focus on significant properties in key topic areas.

Tomorrow, in news that could worry investors, AOL will be noting that traffic is flat year over year, but explaining that it is due to the outsourcing of its sports and health sites.

“If you added that back in, we would have had a phenomenal year of growth,” said Armstrong. “Our main point will be that this is the right path for AOL.”

In fact, in an unusual wording, he said AOL was betting on the “urbanization” of the Web around big branded sites, which is, in many ways, exactly where the Web was a decade ago with Yahoo, Excite and others.

But Armstrong will be making the point that this retro idea is perfect for today, as marketers look for quality content that attracts big audiences, which has seen its most energetic application in the Huffington Post.

Thus, his linchpin remains the flashy news site’s even flashier co-founder Arianna Huffington, who has cut a very wide swath through AOL’s content efforts since Amstrong made her media czar of the company.

As Armstrong did, she also stressed the focus on unique visitors and ad growth, more video and a laser focus on local.

This includes shoving editorial into every AOL property, including unlikely ones such as Moviefone and MapQuest, and integrating it all to point back to the Huffington Post mothership.

“Much better editorial integration is a centerpiece of what we are doing, surfacing content in new places it was not before,” said Huffington, who used examples of local stories via its Patch unit that have gone global with a special push.

And by global, that also means the creation of new content sites in Europe and elsewhere, in order to build this unusual dream of a fully aggregating world.

“It is a big test of the HuffPo platform aggregation to do this,” said Huffington, who has clearly longed for the kind of money and staff to do this for a very long time. “It has moved a lot faster than I thought it would … but it feels good to be moving on so many fronts at once.”

Many fronts indeed, which might make investors pause. So far, those shareholders have had a continued wait-and-see attitude toward AOL, which has seen its stock decline almost 13 percent from its late 2009 IPO debut.

That’s mostly due to worries about whether the continued and expected fall-off of its lucrative access business can be met by similar increases in its ad business.

That share drop has been especially steep since the beginning of the year, but it has also not been drastic, indicating an interest in continuing to believe Armstrong’s confident — well, confidently delivered, at least — narrative.

As Citi’s Mark Mahaney wrote in a one-hand-other-hand note yesterday about the investor day:

Positives: 1) AOL still remains a top 5 U.S. Internet property; 2) In the latest quarter, AOL’s Display segment grew Y/Y for the first time in ~3 years, and this improvement seems sustainable; 3) At 4x ’11 EV/EBITDA, AOL’s valuation is among the lowest of any ’Net Stock. Negatives: 1) Deteriorating fundamentals; 2) Significant market share losses — ’Net usage, Display Advertising revenue & Search queries; 3) A significant profit hole from the structural decline of its Subs biz; 4) Substantial competitive risk; and 5) An unproven (@ AOL) management team.

“We all like Tim and what he says makes a lot of sense,” added one big investor, who is also attending and has many questions about the efficacy of what AOL is doing, in a common sentiment among its large shareholders. “But we also need to see real results soon.”

SurveyMonkey, the quiet but profitable and fast-growing Web survey company, is buying online forms start-up Wufoo.

While the terms of the transaction for the Tampa, Fla.-based Infinity Box–makers of Wufoo–were not disclosed, sources said the price was $35 million in cash and stock.

Besides bringing together two delightfully kooky start-up names, the acquisition gives the Palo Alto, Calif.-based SurveyMonkey another tool to expand its offerings.

The Silicon Valley company’s most recent purchase was telephone-polling firm Precision Polling. And, in January, it acquired a minority stake in ClickTools, a U.K.-based survey provider on Salesforce.com’s AppExchange.

Here’s the official press release:

SURVEYMONKEY ACQUIRES WUFOO

Leader in online surveys adds leader in online forms to expand services for customers

Palo Alto, Calif. and Tampa, Fla., April 25, 2011– SurveyMonkey, the leader in Web-based survey solutions, today announced the acquisition of Infinity Box Inc., the makers of Wufoo, a web application to create online forms. As part of the transaction, the entire Wufoo team will relocate to Palo Alto to join the combined company and help fuel SurveyMonkey’s continuing growth. The terms of the transaction were not disclosed.

Wufoo was created in 2006 to provide an easy and efficient process for creating online forms, one of the most essential and commonly used interfaces for collecting data on the web. The application’s HTML form builder automatically builds the database, backend and scripts needed to collect and understand data so users can create surveys, contact forms, registrations and other forms without writing code. In addition, customers frequently use Wufoo’s forms to process online transactions. With Wufoo, a process that previously required hours of work by web developers can now be done by anyone with web access in a matter of minutes.

“Wufoo is the market leader in online form creation and a perfect fit for SurveyMonkey,” said Dave Goldberg, SurveyMonkey CEO. “From the product and business model, to the team and culture, we are absolutely delighted to welcome the company into the SurveyMonkey family and look forward to increasing the reach and scale of an already outstanding product through our platform.”

“Everyone at Wufoo is very excited about joining the SurveyMonkey team, and the expansion opportunities for our business that will result from this combination,” said Wufoo co-founder Kevin Hale. “By leveraging SurveyMonkey’s international resources, knowledge scaling infrastructure and expertise with large data collection systems, we will be able to increase the scope, performance and reliability of Wufoo’s services.”

The acquisition will allow SurveyMonkey to offer online forms, in addition to surveys, to collect users’ insights and data. Over the past two years SurveyMonkey has continued to enhance services by actively evaluating opportunities to partner and invest in complementary businesses. In January, SurveyMonkey announced it had formed a strategic partnership with ClickTools, a leading survey provider on salesforce.com’s AppExchange. In 2010, SurveyMonkey successfully completed a $100 million debt financing and also acquired telephone-based survey company Precision Polling.

One of the results of Yahoo’s weak earnings report earlier this week has been the renewal of chatter about possible changes in its leadership and even ownership.

And continued investor discomfort with its troubled stock price–Yahoo shares are down 7.25 percent year over year and an astonishing 49 percent on a five-year basis–and the level of renewed grumbling by major institutional shareholders is causing some key players to go back to their PowerPoints to reevaluate various options.

(By way of contrast, Google is down about 4.5 percent year over year–largely due to last week’s earnings release with higher than expected expenses–but still up more than 20 percent for the five years.)

As many might recall, last year Yahoo was under scrutiny by a number of interested parties–from big media companies to other digital players to private equity firms–considering a number of takeover scenarios.

Most of them were just talk and no action resulted, but that did not mean that interest went away.

The truth is, they are still out there and ruminating–this time with what sources describe as a much more amenable Yahoo board, with several of its key members willing to entertain any legitimate offers or ideas to improve the Silicon Valley search giant’s prospects.

In the last go-round, by contrast, Yahoo’s top execs–including CEO Carol Bartz–denied any interest in the swirl of rumors related to a variety of ideas.

That’s definitely changed–at least at the board level–so here are three very credible scenarios of what could happen:

Peetie, Peetie, Yahoo-Sweetie

Late last year, BoomTown wrote a post about the interest that former News Corp. COO and President Peter Chernin–who now owns his own entertainment production company–had in the situation at Yahoo.

As I wrote in November:

But multiple sources from a variety of sides said that Chernin, a well-liked and deeply experienced media and entertainment exec, has been contacted by a number of private equity firms and other investors about his interest in becoming involved should any of the various and sundry scenarios around the Internet giant pan out.

And Chernin, many sources said, has expressed a definite interest in the situation, perhaps because he was deeply involved in a previous deal when running News Corp.

At the time, it involved combining the media giant’s Myspace social networking site with Yahoo and also Microsoft’s portal MSN and creating a new company, code-named “TrafficCo.”

Indeed, that interest remains for Chernin, who has also been an increasingly active investor, including in the digital sector. He is an angel funder of the hot social media app start-up Flipboard, and also just joined the board of the popular Pandora music service.

The most likely possible scenarios have him joining with deep-pocketed partners, including Providence Equity Partners and, yes, Microsoft, as well as investment banks or advisory firms, such as Morgan Stanley and Code Advisors.

The approach being considered–which would only be done in a friendly way, with the cooperation of Yahoo’s board–would center on making a large enough investment in its shares, allowing the group to take control of the management and the board, putting Chernin in as chairman and maybe CEO (or with a new CEO–see next section).

If Microsoft were involved–and Chernin has strong ties there–such a scenario might include folding all its online properties into Yahoo and renegotiating its rocky search partnership, too.

This is an idea that intrigues a lot of people–including current Yahoo board chairman Roy Bostock, co-founder Jerry Yang and other board members–who have indicated recently to several investors and dealmakers a willingness to listen to credible player such as Chernin.

But, in this scenario, it would be up to Chernin and his partners to make a prosposal, said sources, and he might decide that the complexity of getting the power to make big changes at Yahoo is too big to tackle.

In addition, Chernin remains a successful Hollywood player, with several major television and movie projects in the works, as well as big investment possibilities in Asia.

“Does he want the headache of Yahoo at this point in his career?” asked one person, among many Chernin has talked to recently about becoming involved in the company. “Would you?”

Maybe so, if it would provide a big financial windfall. Many think an exec with a reputation like Chernin’s could easily begin to move Yahoo’s moribund stock upward quickly.

ABC (Anybody But Carol)

Here’s one truth: Yahoo CEO Carol Bartz does not get proper credit for a number of moves she has made since coming to the company two years ago, including cleaning up the messy corporate structure, de-complexifying garbled systems, cutting costs and bringing its far-flung operations into line.

Yahoo’s stock is certainly doing better than when she arrived in early January of 2009, when it was in the $12 range compared to its current $16 price point.

But here’s another: That stock price now includes more than $10 in solid assets–cash and Yahoo’s much more valuable stakes in China’s Alibaba Group and Yahoo! Japan–leaving very little true share appreciation.

And here are more truths: Bartz’s inability to get revenues growing, innovations flowing, promising start-ups acquired and–most importantly–to stop the continual exodus of talent out the door of Yahoo has made her tenure shakier than ever.

Add to that making its relationships with Asian partners more tense, almost no traction in key mobile, video and social arenas, a record of loud public declarations that have fallen flat and serious troubles in Yahoo’s search and online partnership with Microsoft–a deal Bartz struck and is charged with managing–recently highlighted in Yahoo’s earnings earlier this week.

As shareholder activist Eric Jackson, who has long agitated for change at Yahoo, wrote this week in a post:

“The truth is that investors are fed up with Bartz. Their enmity towards Bartz is palpable when you talk to them. Bartz talked a big game coming into the job and she hasn’t delivered. It’s that simple.”

Well, not that simple and maybe not fair, but it’s also clear that no one thinks Bartz will be re-upped when her contract is up in 18 months.

Thus, it’s no surprise that ideas of other possible leaders of Yahoo are being contemplated now.

Here’s the short list I have made of my choices: Akamai President and Yahoo board member David Kenny; former Microsoft exec and current Juniper Networks CEO Kevin Johnson; former AOL CEO and current News Corp. digital head Jon Miller; and Nikesh Arora, current Chief Business Officer and sales head at Google.

There are plenty more to pick from, of course, and any could be installed in conjunction with an effort such as Chernin’s.

AOL Under the Hoop

No good Yahoo scenario plotting can be contemplated without including AOL and its flashy CEO Tim Armstrong.

Armstrong has made no secret of wanting to get ahold of Yahoo properties to apply the strategy he has been trying at AOL to get it moving again.

Which is: To become the premiere digital media company.

Which is actually Yahoo’s new motto–although arguably, in word and deed, Armstrong has been much more active in pushing the concept and narrative.

That includes his incessant acquisitions of all kinds of online media properties, including the big fish–the $315 million purchase of the Huffington Post and the coronation of its even-flashier co-founder Arianna Huffington as content chief.

Armstrong has certainly not been averse to the idea of a Yahoo-AOL hookup with him at the top, and has been actively talking to anyone interested in such a deal.

And things could get a lot more interesting if AOL linked with a bigger strategic partner, such as News Corp. or Disney or even Google, Armstrong’s former stomping grounds.

Still, wishing does not make it so, especially with a much smaller and weaker set of assets than Yahoo and a still poor record on goosing its advertising sales.

AOL’s stock is down 30 percent year over year, as investors still worry about Armstrong’s ability to turn the company around, which kind of puts him in the same situation as Bartz.

“AOL is waiting under the hoop for whatever happens, which is a good place to be,” said one person close to the situation. “Why not?”

Why not, indeed–so, let the games begin.

The service, which falls under the broader category of person-to-person payments, is part of a growing effort to replace cash transactions.

Other credit card issuers have launched similar services to make it easier to pay the babysitter, a friend or small business without going to the ATM or writing a check. Visa and American Express have made recent announcements, and there are companies like Square that want to help small businesses accept credit cards.

Discover’s service, Money Messenger, is powered by PayPal, which announced the partnership back in October.

Discover, which has millions of cardholders, is the first credit card issuer to go live on PayPal’s third-party payment platform, said Dan Schatt, PayPal’s head of financial innovations.

Schatt said by leveraging PayPal’s services, Discover’s customers can send money to people in 60 countries, as long as the other person has a mobile phone number or email address. The recipients must have a PayPal account, or can open one after the fact. There are roughly 230 million registered PayPal users today.

Other than awareness, there are few hurdles or costs involved.

A Discover customer does not have to have a PayPal account, and it is free to send cash to people. In fact, the payment is treated as a purchase transaction, so members will receive cash back for every transaction, which roughly equates to .25 percent for the first $3,000 spent.

“It’s so strategic and compelling,” Schatt said. “Banks have never been able to penetrate the cash or check market, and cash still dominants. The reality is, people will still pull out $200 to $500 from the ATM and dole it out for various payments over several weeks, or they write checks and banks don’t benefit.”

Discover can use it as a way to find new customers and increase transactions on its network. It’s also, potentially, a defensive move against other technology companies, such as Amazon, Google and Apple, which are likely prepping payment services of their own.

People who receive money from a Discover member will be given the opportunity to sign up for a card.

In a statement, Mike Boush, Discover’s VP of its Ebusiness, said: “This offering provides Discover cardmembers with another way to help them earn rewards on more types of purchases and give them the ability to consolidate and track more of their spending on one payment vehicle.”

Late last month, BoomTown posted about a huge venture funding effort by the high-profile and even more highly designed social media reading app for the Apple iPad, Flipboard.

Today, its co-founder and CEO Mike McCue confirmed the $50 million round at an eye-popping $200 million valuation, in a wide-ranging interview at the start-up’s Palo Alto, Calif., HQ.

“We’re obviously thrilled, because we think it confirms our focus that people want a beautifully designed way to interact with content and to share it,” he said. “And there is a lot more to come–on a scale of one to 10, we’re just at a two or three.”

The bulk of the new second round of funding–Flipboard had previously raised $10.5 million–came from New York-based Insight Venture Partners.

Insight’s Jerry Murdock said in an interview that he was excited about the idea of “social endorsement” that Flipboard was pioneering.

“We back great entrepreneurs and Flipboard is that and also in an obviously unique position to solve a problem of media consumption in the digital age,” he said. “The sky is the limit. Or more precisely it is the best environment to consume curated real-time content for Twitter and Facebook, because of the user experience and social endorsement integration with the content.”

Insight is also an investor in Twitter.

Also stepping up in the new Flipboard round is Comcast’s venture arm, as well as previous investors, including Kleiner Perkins, Index Ventures and a spate of well known angels, such as Twitter co-founder and product guru Jack Dorsey, Facebook co-founder and Asana dude Dustin Moskovitz, the ubiquitous Ron Conway, actor Ashton Kutcher and the investment company of former News Corp. exec Peter Chernin.

“From a Comcast perspective, we’re intrigued with Mike and what he’s doing with content aggregation,” said Amy Banse, Comcast Interactive Capital’s new head. “We think we can learn from him and he from us.”

Co-founded by longtime entrepreneur McCue (Netscape, Tellme) and former Apple iPhone engineer Evan Doll in January, Flipboard launched to much attention in July.

The elegant Flipboard–which McCue recently told me in an onstage interview at the South by Southwest conference in Austin had zero revenues thus far–has changed the game on the consumption of social media.

Its innovative social magazine concept is attempting to make the social networking universe more accessible, consumable and, perhaps most importantly, visually arresting via its rich app.

Essentially, Flipboard pulls information from media RSS feeds and sites such as Twitter and Facebook data streams and then reassembles it in an easy-to-navigate, personalized format in a mobile tablet touchscreen environment.

In its current offering, there are pull-quotes, photos, videos, status updates and even the first paragraphs of linked-out content. There is also the ability to comment and share, as if one were on a social networking or microblogging site.

McCue said the new giant pile of cash will be used to increase its 32-person staff to about 50, international expansion, small acquisitions and more product development on more platforms.

The next in the arena will be the iPhone version of Flipboard, said McCue, followed by one for the Google Android mobile operating system eventually.

Left unsaid, of course, was the need for funding to fight the likelihood of increased competition in the hot space for delivering both professional and social content to consumers on a wide range of devices.

Rivals are varied, such as Silicon Valley’s most adorable news reader start-up Pulse and also Zite, a news reader which was recently sued for copyright infringement by a group of major publishers.

There are bigger potential players, such as Google, which is trying to find various ways to move into the social space.

In fact, said several sources, Google and others have made acquisition approaches to Flipboard, which has instead opted for raising more funding and staying independent for now.

McCue declined to talk about that, but did note that he is not surprised by publisher interest, especially of the worried and wary kind, in the arena.

“Anyone not respectful of others’ content is going to get in that kind of trouble,” he said, noting Flipboard has struck deals with 17 big publishers so far, including this morning’s announcement about a partnership with Oprah Winfrey’s and Discovery’s OWN cable network. “There is not one half to this equation.”

Right now, the Flipboard app is free and the business plan is advertising and some possible subscription scenarios.

McCue said advertising will be the key to Flipboard’s business plan in the future, although it’s not clear if the company will ever sell advertising itself.

Rather, it will partner with publishers seeking better distribution in the explosive tablet and smartphone market, where Flipboard has been gaining traction quickly.

But until that is sorted out, there is now $50 million more in the Flipboard kitty to figure it all out.

“With this funding, we can grow at the right pace and have a lot of flexibility to get the product right,” said McCue. “And, that’s the most important thing.”

Today and tomorrow, Yahoo’s directors are gathering here in Silicon Valley for one of their regular meetings that take place over the course of the year.

While board meetings in general are usually pretty dull affairs–and Yahoo’s, in particular, are typically glacial ones–there is a lot on the plates of those with purview over the machinations of the long-struggling Silicon Valley Internet giant.

Here’s a primer of what might (and might not) be happening, according to sources, of course, as Yahoo continues on its quest to reinvigorate itself–a journey that is beginning to make Siddhartha’s transformation into Buddha enlightenment look speedy.

A Yahoo spokeswoman declined to comment on anything below, although I did run it all by them.

The U-Shaped Turnaround

At Yahoo’s recent sales meeting in San Antonio, CEO Carol Bartz went all Sesame Street on the troops, using the letter “U” as an illustration to indicate where in the cycle the company was in its turnaround.

Apparently, just on the other side of the very bottom of the letter, heading inevitably upward.

Her argument was that the company has finally cleaned up its platform mess and its confusing corporate structure, and that its display and search advertising business is now recovering nicely.

All true, except there are some other key issues, such as the slowness of the search and online advertising partnership with Microsoft to make some serious hay.

In fact, although its display business will show a definite strong recovery in Yahoo’s quarterly results next week, its search business–both in market share and revenue per search (RPS)–has, as one person close to the situation put it succintly, “fallen off the cliff.”

That’s due, in part, to getting the new system with Microsoft delivering better results, which is not happening yet (if ever!).

In this quarter, Microsoft has honored its contractual guarantees and will make up the difference–which will result in masking the magnitude of the RPS loss. It’s a worrisome trend to watch.

The Asia Situation

Yahoo and its Asian partners are still mulling over various options regarding the company’s large ownership stakes there.

What is happening with its share in China’s Alibaba Group, according to sources, is precisely nothing right now, as has been made clear in recent comments by its CEO and co-founder Jack Ma.

“If you cannot make the business cool, you have no right to be angry with me,” said Ma in an article in Forbes published this week, referring to Yahoo. “I just don’t trust them…I’ve been working with them for years, and I’m disappointed.”

Relations between Ma and Bartz, sources said, remain as bad as ever, and even the normally close one between Ma and Yahoo co-founder Jerry Yang is strained.

Plus, Ma told Forbes, as he has said before, Alibaba is not taking its auction site, Taobao, public–leaving Yahoo in possession of an appreciating but decidedly private asset.

Japan is a different story, with the disposition of Yahoo’s stake in Yahoo! Japan the subject of long and continuing negotiations for a while now.

While the earthquake and tsunami crisis there did slow discussions down, there is still active recent movement about a variety of cashing-out scenarios, all of which have massive tax and regulatory issues.

Without boring you with the specifics, one option is to create a tracking stock, another a spin-off of the asset and still another some sort of stock trade.

But no matter what happens, Yahoo will have to pay some sort of taxes on its 35 percent stake in Yahoo! Japan, now worth $8 billion.

But if its CFO Tim Morse–the key figure working on the deal–can pull it off, what will Yahoo do with all that money?

Acquisition Guns Blazing? Or Sputtering?

In a recent forum in Silicon Valley, one of its M&A minions said Yahoo had its “guns blazing” with regard to acquisition activity in 2011, as deliciously reported in The Wall Street Journal, despite the company’s lackluster acquisition record.

Sources said the exec had his ears soundly boxed by his managers for the dopey remarks, since Yahoo has had such a lackluster record in the arena–especially compared to others.

And, oh yes, Yahoo’s M&A head just decamped to gaming phenom Zynga.

That aside, Yahoo should be deep in the market for hot start-ups to help revive its innovative spirit, but it remains hindered by a continued reluctance by new start-ups to join it and by its reputation for being a place where entrepreneurs go to die.

That certainly could change at any time with the right execs in place, but Yahoo is competing with a plethora of more exciting companies and also a seemingly endless venture capital gusher of cash of late.

While it is the board’s job to approve acquisitions and not source them, perhaps it is its job to pressure Bartz and other execs to get off the stick and hit at least one of the targets Yahoo aims at.

Targets are plentiful in advertising, content and even social, with many start-ups playing right into a lot of arenas Yahoo needs some help.

And help it does need as talent keeps walking out the door daily, mostly to hotter prospects such as Zynga and social buying sites Groupon and LivingSocial.

There is no question it is hard for any large company to hold onto top staff when there are so many enticing bonbons out there as options, but it can be done.

One good thing: Its newish head of product Blake Irving and head of U.S. media and advertising Ross Levinsohn seem to be playing well together and are setting a tone of stability that is much needed.

Enter the Kenny

That said, there remains endless swirl, especially with key investors, about the performance of its CEO.

While she started off as a publicly in-your-face exec, Bartz has definitely stepped out of the limelight of late, as her pugnacious manner started to irritate Wall Street and others.

It was a good idea, since it has taken the focus off the lack of stock and revenue progress she had loudly promised.

Still, Yahoo shares have continued to stay locked in the mid-teens, as investors wait for some sign that Bartz’s turnaround has worked.

The entrance of its spanking new director, Akamai President David Kenny, has further increased speculation about management and board changes at Yahoo.

This is Kenny’s first board meeting, but this well-connected newbie is someone who is clearly going to rise quickly to the top of decision-making at Yahoo.

That’s because the smooth and well-liked Kenny, who also has deep advertising experience as founder of the Digitas agency, has a long relationship with Yahoo and also with Yang.

He also now has much more tech cred as a leader of one of the Internet’s most important infrastructure companies, with a ton of regular contacts with media giants, ad networks and video providers that are Akamai’s clients.

In other words, Kenny (pictured here) is the full package of ad and tech experience that would make him an obvious Yahoo CEO candidate when Bartz’s contract is up in early 2013, if not before.

He’s also the person most likely to take over for longtime BoomTown punching bag Roy Bostock as chairman of the board at some point.

None of this is happening soon, but it is clearly an interesting development.

There are other machinations, of course, from continued interest from private equity players in Yahoo, as well as a variety of takeover scenarios, each more complex than the next.

While often derided as yesterday’s news by the elite of Silicon Valley as on an inevitable downward path, those plots are there because Yahoo remains a stellar brand with consumers worldwide and an Internet property with huge traffic and a big ad business.

In other words, it’s a U that someday maybe could be a V.

Payfone has raised $19 million in a third round of funding. In addition to American Express, Verizon Investments and Rogers Communications is also participating, along with existing investors Opus Capital, BlackBerry Partners Fund and RRE Ventures.

As part of the investment, American Express will integrate Payfone’s mobile payments service into Serve.

Serve is American Express’s new digital payments initiative, which lets consumers make purchases, take cash withdrawals from ATMs and make person-to-person payments from their computer or their phone. Serve is currently like PayPal, but aspires to be something much broader that integrates mobile payments, loyalty programs and other social and connected services.

Right now, most the services revolve around plastic cards and mobile applications.

But together, the companies said Serve will be able to offer consumers the ability to make purchases online using their mobile phone number at checkout. To do so, a consumer would link their mobile numbers to a variety of payment methods, including their wireless bill or their Serve account.

Many other venture-based companies are meddling in mobile payments, but it has been slow to take off since the fees carriers charge can be prohibitively high for merchants. Instead of taking a couple of percentage points, like Visa or MasterCard, carriers can charge up to 40 percent of each transaction.

Other startups in the space include Zong, Boku, BilltoMobile and mopay.

So far, high fees have mostly limited payments to high margin items, such as virtual goods. While we’ve reported that’s changing, and digital and physical goods are becoming more of a reality, Payfone believes it has a faster way to market.

The explanation is a bit complex and the details are caught up in the deep recesses of the network. But at a very high level, Payfone is trying to build a system that relies on the same standards used by carriers that give permission for a subscriber to roam from one network to another.

When a subscriber roams today, it requires two carriers to communicate to ensure that a subscriber is in good standing and will be able to pay the roaming fees–and to do that as fast as it takes to make a phone call.

In the same way, Payfone says it can determine if a consumer has the funds or the credit worthiness to make a purchase. By checking with the carrier upfront, it also claims to dramatically reduce fraud charge-backs and identity theft–which makes it feasible to reduce the fees in the system.

Payfone said it will use the fresh round of capital to continue expanding across North America, Europe, Latin America and Asia.

While American Express’s participation in Payfone signals the company’s interest in the category, it pales in comparison to the $300 million acquisition of Revolution Money, which makes up the basis for the Serve platform today.

According to sources close to the situation, Intel Capital and Advance Publications will lead a $30 million investment round in Kno, the high-profile student tablet start-up.

In addition to the funding from its venture capital arm, Intel itself will consult with Kno on its tablet design. Kno, which is getting out of the hardware business, will now focus on its software to manage the devices that are aimed at the college market.

Intel will not manufacture tablets either. Instead, its engineers will consult with Kno on power management, graphics, display, systems integration, which it does for a variety of its customers.

Along with Intel Capital and Advance, current investors will also participate in the round, said sources. But Intel Capital and Advance, the owner of the Condé Nast publishing empire, make up a big part of the funding.

Sources said Intel Capital’s investment is $20 million and Advance and others make up the rest of it.

BoomTown reported in February that the much-funded and high-profile Silicon Valley start-up–aimed at making tablet computers focused at students–was considering selling off the entire hardware part of the business.

Sources said Kno execs have recently decided that the quicker-than-expected uptake in tablet production by a multitude of powerful device makers had made its efforts to package a seamless offering less critical.

Instead, the company will now focus on its robust software and services to offer students on the Apple iPad, as well as upcoming tablets based on Google’s Android mobile operating system and others.

The move is a dramatic shift for the company, which had not shipped significant numbers of the touchscreen device as it has long touted.

In fact, Kno said in November that it would ship a $599 and $899 version of the tablet by the end of the year.

The lower price was for its single-screen device, while the clamshell double-screen version was more expensive.

And, although it has been reported no pre-orders were fulfilled, Kno did indeed ship several hundred of them, built by China’s Foxconn, before stopping doing so earlier this year.

Many have been dubious about Kno’s ambitious hardware efforts.

That’s because marketing a new and complex product like the Kno takes a lot of effort and cash, especially since it is an increasingly competitive market for mobile and portable computing products that includes Apple, Microsoft, Hewlett-Packard, Google, Amazon, Dell and many others.

Before this $30 million, Kno has raised another $46 million in funding to add to an earlier $10 million round.

Sources in February said that the Santa Clara, Calif.-based company considering going back out to raise even more.

Its current backers include prominent venture players like Andreessen Horowitz and First Round Capital, along with angel investors Mike Maples and Ron Conway.

Sources said the shift to deliver textbook and other student-related delivery system would be a better path for all that investment money, since Kno has established a wide range of partnerships with colleges and universities.

In addition, Kno co-founder Osman Rashid has a lot of experience in digital education market. He was also the co-founder of Chegg, the textbook rental business that is reportedly aiming for an IPO soon.

BusinessWeek was first to report that Intel Capital was making the investment in Kno, but the post did not mention Advance’s involvement or that Intel itself was licensing the hardware design business from Kno.

The service, called Serve, will let consumers make purchases, take cash withdrawals from ATMs and make person-to-person payments from their computer or their phone.

The card will be funded by a user’s bank account or credit or debit card–even from one of the company’s major competitors, like Visa or MasterCard.

In the beginning, Serve will be fairly traditional and be accepted anywhere that American Express is accepted, but eventually it could give way to a mobile payments solution on the phone, using such technologies as near-field communication (NFC).

“What we are trying to do is put into place a platform–not a card, or an e-wallet–that enables digital payments and commerce that allows consumers and merchants to seamlessly move between online and offline,” said Dan Schulman, Group President, Enterprise Growth at American Express.

What Schulman said he wasn’t interested in experimenting with yet was NFC, which allows users to waive their phone at the register to pay. The technology is still in its infancy.

“That’s incredibly uninteresting…That’s a form factor shift, not a value proposition change,” he said. “The distinction between online and offline is going to blur and become moot as you go out three to five years from now.”

Schulman has been thinking about these problems since joining American Express in August 2010.

Previously, he was the president of Sprint’s prepaid division, having joined the third-largest carrier when Sprint acquired prepaid provider Virgin Mobile USA, where he served as CEO.

The Serve platform evolved from American Express’s $300 million acquisition of an Internet-based payments network that was part of America Online Inc. called Revolution Money, co-founder Steve Case’s investment firm.

To be sure, the launch provides new ways for the $54 billion company to diversify its user base.

“This will enable us to break into a younger demographic for sure, or under-served demographics, and people who’ve used debit, checking or cash. It enhances our ability to address different demographics in the U.S., but also the rest of the world,” he said.

On day one, Serve will be accessible online and from applications on both Apple and Android devices, with support for BlackBerry coming soon. Initially it will be in the U.S., but will shortly expand internationally. It will also downplay its associations with the large card company.

“We are really excited about the launch, it’s really different than what people might think about American Express. It’s not AmEx-branded, it’s cross-platform and completely open,” Schulman said.

He expects the platform to be very flexible and adapt to the market in future iterations.

To help promote the platform, the company is creating a number of partnerships that are all over the map.

One is with Ticketmaster, which will let users buy tickets to an event and then get reimbursed by their friends via Serve. Others include Concur and Flipswap. The service will also be available through a Facebook widget. To promote the widget, Serve will be letting users donate to certain causes. Serve will match contributions up to $100,000 for each charity.

While these are new areas that American Express does not currently serve, Schulman believes its experience makes the company a potential leader in digital payments.

He said it helps that they have 90 million card members and have partnerships with thousands of merchants worldwide. Also, he said, there are three crucial pieces of the puzzle that a company entering the space must have: trust, security and good customer service.

Of course, eBay-owned PayPal, Visa, MasterCard and a variety of other startups–including Boku, Zong, BilltoMobile and Square–are all vying for a position in the emerging digital and physical payments market.

Schulman admits there’s a lot of overlap with what it is doing and PayPal. “Yes, there are obviously things that are similar to PayPal. In fact, there are quite a number of people thinking about this as we are making a transition from a physical plastic world to a digitally-oriented payments world.”

For instance, PayPal will be conducting several pilot programs over the next year to test how consumers will use their PayPal accounts at the register.

Visa recently purchased PlaySpan for about $190 million to enter the digital payments world. Google also is planning its next move.

With all this talk about payments, American Express indeed expects to get paid as well.

To start, most consumer fees will be waived for at least the first six months, including fees for adding money to the account and transferring funds between Serve users. The first ATM withdrawal each month is free, but after that consumers will be charged $2. After the introductory period, consumers will be charged 2.9 percent plus 30 cents each time they load money (that drops to 0 percent for cash, debit and ACH).

Merchants will also pay, but will be charged a discounted rate for transactions made in stores and online since Serve is considered a prepaid card. Typically, prepaid discount rates are less expensive than credit rates, according to a spokeswoman.

But its not just the fees that American Express wants to collect. It also wants to collect consumer data to be able to offer well-targeted offers.

“We’ll probably make the equivalent once we are at scale, depending on funding and merchant mix through payments alone. We think that’s a great business. We also think that the data we can collect with consumers, assuming they give permission, will add a number of value-added services in connection with partners.”

At an event in Washington organized by IBM, The Hill reports, Rep. Rush Holt, who represents New Jersey’s 12th District and was himself a “Jeopardy” champion some 30 years ago, beat the machine in a special congressional round of the game. The score: Holt $8,600, Watson $6,200, after a full round. Also playing was Rep. Bill Cassidy, a Republican from Louisiana, who scored $1,000.

Holt, it turns out, is a pretty smart guy to start with. Before running for Congress–he’s now in his seventh term–he was a nuclear physicist. Wikipedia says Holt is one of only two members of Congress to have appeared on “Jeopardy,” the other being John McCain. Where “Jeopardy” is concerned, may we call Holt humanity’s last hope?

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EMoney was given the task of moderating a panel called “Leveraging New Markets” in front of a packed room with two other competing panels.

The participants were Ted Sorom, the CEO of Rixty, Bruce Bower, the CEO of Plastic Jungle and Jeff Thomas, SVP of SecondMarket.

There’s no video, so you’ll have to endure a written recap from my perspective as chief interrogator.

First, if you aren’t familiar with these companies, the four of us can attest there’s only one thread in common: Liquidity, and creating marketplaces to make assets more fluid.

The discussion is well-timed as we push beyond e-commerce and Web 2.0 to a new reality, where reducing friction to payments is turning into a large opportunity.

One solution popping up everywhere is to create virtual currencies, which solves the problem of paying for many items at small price points because it doesn’t make economic sense to charge 50 cents to your credit card on a regular basis.

Meanwhile, there’s lots of clogs in the system, ranging from gift cards that are never redeemed, to a large population of people who don’t have credit cards, to the more extreme, like what will eventually happen to all of those unused Groupon and LivingSocial vouchers?

Here’s a look at how all three are trying to add liquidity to the system:

Rixty: The San Francisco company allows consumers to buy prepaid cards with cash to be redeemed for game credits online, such as Facebook Credits and Zynga’s CityVille.

On the panel, Sorom announced that Rixty’s distribution was increasing from 20,000 physical locations to 70,000 with the addition of Green Dot MoneyPak prepaid cards, which are sold at Walmart and 7-11. Greendot charges a $4.95 service fee, which Rixty will redeem as soon as soon as the card is spent online.

Plastic Jungle: The San Jose, Calif.-based company is a secondary market for unwanted and unused gift cards.

The company buys them for up to 92 percent of face value, and sells them at a discount. Bower says some of the highest value gift cards are for Target and Walmart because they are the closest to cash. The lowest value cards are from local retailers or seasonal items, like See’s Candy, which only sell well on Valentine’s Day and Christmas.

SecondMarket: The New York-based company is a secondary market for private stock in companies, such as Facebook and Twitter. It deals in getting liquidity to employees or shareholders, who can’t yet sell their stock on the public market.

The summary is that while cash may still be king, the trend is to enable liquidity.

Some of the high-level takeaways:

– Thomas of SecondMarket: The company is constantly in headlines for being associated with Facebook’s $70 billion-plus or minus-private valuation. He said private company stock sales have become the fastest growing part of its business with transactions increasing to $400 million in 2010, up from only $100 million in 2009.

He said an essential part to keeping the assets liquid is to keep the information flowing, which is inherently difficult with companies that aren’t required to disclose any financial information. The company will soon be partnering with researchers to produce independent reports that will be purchased by potential investors.

Sorom of Rixty: One of the big questions was how dominate Facebook will be able to become as a virtual currency platform.

Most panelists agreed that it was inevitable that it will become a powerhouse, but that it will face hurdles on two fronts. In order for it to win, it will have to appeal both to consumers and merchants. And, currently it charges a 30 percent fee, which is much too high for most physical and even some digital goods.

Sorom said regulations will also limit its activities. Just like at Rixty, they have avoided allowing users too much liquidity. The credits can only be used for pre-approved merchants and can not be swapped or traded among friends. Similarly, Sorom believes that Facebook would not have that have that ability, given current federal regulations.

Bower at Plastic Jungle: Bower saved the best for last. Whenever trying to come up for a good description of liquidity think back to your college days, especially if they were pre-Internet.

As a crafty collegiate, he learned to live off one square meal, turning in his other meal plan points for cash. He purchased brand new textbooks on his parent’s dime and then returned them for used books a day later. All of the cash allowed him to gain the most important liquid asset of all — beer.

Photo Credit: Rick Scully.

Nuance Communications, a software company best known for its Dragon Naturally Speaking line of speech-recognition software, today announced a research agreement with IBM to explore ways to use the Watson system and its deep analytics technology in the health care industry.

The agreement calls for the companies to combine IBM’s Deep Question Answering, Natural Language Processing and Machine Learning capabilities with Nuance’s speech recognition and Clinical Language Understanding, which is basically speech recognition tuned to the unique needs of doctors and other health care pros. They expect products resulting from the research to hit the market within two years. Researchers at Columbia University Medical Center and the University of Maryland School of Medicine are also getting involved.

The hope is that Watson’s ability to analyze the meaning and context of spoken language and quickly sort through the information in it to find precise answers can help humans arrive at decisions faster, and arrive at answers they might not have otherwise thought of. A doctor mulling a patient’s diagnosis could use Watson to quickly check medical literature and help evaluate a decision.

Nuance has a huge health care segment, accounting for a little less than half its sales. The division includes Dragon Medical–desktop software for doctors–and eScription, which docs use to phone in comments that are converted to text that’s entered into medical records. It’s also been building voice-recognition apps for Apple’s iPhone, both for consumers and for doctors. IBM and Nuance will jointly invest in the research project, and IBM has licensed access to the Watson technology to Nuance.

Nuance itself is an interesting company. Spun out of Xerox in 1999, it started out in the scanning and text-recognition software business, and then in 2001 scooped up the assets of the bankrupt Belgian outfit Lernout and Hauspie using a combination of debt and cash raised in a private placement from the state of Wisconsin’s investment board. It turned out that speech recognition’s time had come, and as sales of Dragon improved, it proceeded to roll up scores of other companies in the speech- and text-recognition game, including one founded by Alexander Graham Bell himself. Sales were north of a $1 billion for the first time in the year ended September 2010, and its shares have improved considerably over the last year, though given its size, the stock often moves on takeover rumors.

PREVIOUSLY:

• All Humans Bow Before the Mighty Watson, Master of “Jeopardy”
• IBM “Jeopardy” Challenge Day 2: Very Different From Day One
• IBM “Jeopardy” Challenge Day One Ends in a Tie
• That Human Vs. Machine Practice Round of “Jeopardy” Didn’t End the Way You Heard It Did
• “Final Jeopardy” Question: Would You Buy an E-Book Without an Ending?
• This Supercomputer Defeated Human Champions of a TV Game Show in 2011
• I’ll Take Computer Company PR Stunts for $1,000,000