Dan Gilbert’s bid for Yahoo fails but his quest to lure tech firms to Detroit remains
Whatever Dan Gilbert’s plan were for Yahoo Inc. and what it would have meant for Detroit appears to be academic: Telecom giant Verizon Communications Inc. has won the bidding contest to buy global internet firm Yahoo Inc., according to news reports Sunday.
Verizon has agreed to buy Yahoo for $4.8 billion, Bloomberg, the Wall Street Journal and other media outlets said. None of the companies involved commented Sunday and the reports relied on anonymous sources.
An official announcement was expected early Monday.
If true, it means the bid of billionaire founder of Quicken Loans Inc., the nation’s largest online mortgage lender, for the struggling internet pioneer has come up short. He teamed with fellow billionaire and legendary investor Warren Buffett for the Yahoo bid.
Representatives for Gilbert did not respond for comment Sunday. The sale is expected to include Yahoo’s email service and news, finance and sports websites as well as its advertising tools.
Gilbert often mentions the city’s “technology-centric growth” as crucial to Detroit’s future and he’s already invested heavily in tech companies and lured many start-ups downtown. He never fully stated his ambitions for Yahoo, but when asked about it in May, he mentioned his desire to make downtown Detroit one of the “fintech capitals of the world.”
“Fintech” is a term for companies that apply computer and internet technology to the financial industry. The fintech sector is a booming, multi-billion dollar field that includes everything from start-ups who try to come up with technological innovations for a wide range of of consumer and business-to-business financial services, to larger more established companies who seek to use technology to make financial systems more efficient.
“Dan Gilbert always talks of building a high-knowledge, high-wage core” in Detroit, said Lou Glazer, president and co-founder of Michigan Future Inc., a nonprofit that promotes Michigan’s role in the knowledge economy, in a recent interview with The Detroit News. “That vision goes beyond Yahoo, but in his investments in start-ups and workers he’s bringing downtown.”
Quicken Loans is also the nation’s leading Veteran Affairs lender and the largest FHA lender. Quicken recently launched a new website called “Rocket Mortgage” that allows users to refinance or purchase a home in as little as eight minutes.
Gilbert is a major force in downtown Detroit. Entities connected to Gilbert and his Bedrock real estate have invested $2.2 billion since 2010 in buying and renovating more than 90 Detroit properties mainly in the city’s downtown. The properties range from skyscrapers to parking garages and smaller buildings. He has long talked of creating a tech and entertainment hub in the Motor City. He owns other ventures from casinos to media publications to the NBA’s Cleveland Cavaliers.
Gilbert and Bedrock have already recruited a number of entrepreneurial startups and other tech firms downtown, including Google for Entrepreneurs, Microsoft Ventures, Twitter, as well as start ups Detroit Labs, StockX and numerous others. He recently helped launch Rocket Fiber, a fiber-optic Internet service initially targeting the central business district downtown, Midtown and Corktown.
Here’s what Gilbert had to say last month when International Bancard, a technology-focused credit card processing company, announced plans to relocate its headquarters from Clawson to 1505 Woodward Avenue in downtown, a Bedrock property.
“International Bancard is making a meaningful, long-term commitment to Detroit which will be impactful for the city’s technology-centric growth trajectory,” Gilbert said last month. “This is another great example of an innovative, tech-focused company moving its headquarters downtown and further evidence Detroit is quickly moving towards becoming one of the fintech centers of the country.”