And those types of interactions increase collaboration, new solutions, competition, energy, and learning, Sullivan said.
Facebook paid its employees $7,000 extra to live within one mile of the office (until the city got angry when it drove up rent), Sullivan said.
"So when you're 21, you bike or skateboard to work, where there's free food. You come early, stay late, you come in on weekends for no reason ... these people are geniuses," Sullivan said. "It's all data driven."
So far, the data on Yahoo might tell the story: the stock is higher now than before the announcement.
"They might feel like they're losing freedom, but they're gaining job security," Sullivan said. "Otherwise, in five years will be gone ... I'm betting it's the smartest move ever."