Welcome to the Googleplex
by John F. Ince
The historical similarities between Google and Yahoo! are almost eerie. Two Stanford graduate students develop a new way to organize and find information on the Internet in their spare time between classes. Word spreads across the campus that they’re onto something. The whiff of significance drifts up the hill to the VC mecca on Sand Hill Road. Two blue chip venture capital firms pump big bucks into the venture. The students chuck their studies to devote full time to growing a company. The buzz grows. They choose a funky name that seems to be on everyone’s lips. “Do you Yahoo? No, actually I Google.”
According to Danny Sullivan of SearchEngineWatch, “Google is a shining example of superior technology actually drawing traffic on the Internet rather than marketing. But they are still in their honeymoon phase. Since it it the hot thing and there is a buzz about it, people are trying it.”
Indeed, using virtually no paid advertising, in a little over three years since the release of its beta site, Google is now the world’s largest search engine, offering users lightening fast access to over 1.3 billion Web pages. Half of their searches come at their own Website, google.com, and half come from co- branded Websites like Netscape, or, you guessed it, Yahoo! Those portals contract with Google to provide search on their sites. Two years ago, Google had just popped up on the radar screen. While Yahoo has since morphed into a full service portal, offering everything from free email, to e-commerce, to multimedia, to games, to auctions. Brin and Page are purists. The Google Website has the uncluttered look from a bygone era … a pristine simplicity, and it loads in an instant. To many, this is it’s strongest appeal. Google is not trying to be everything to everybody. They are simply providing “search, search and nothing but search.”
Those words were spoken by Michael Moritz from Sequoia Capital. Sequoia along with Kleiner Perkins funded Google to the tune of $25 million. Both Moritz and Kleiner Perkins’, John Doerr sit on the Google board, and Moritz also sits on the Yahoo! board. What do these two heavyweights see in Google? Moritz sums it up succinctly, “Search is such a great opportunity, such a nettlesome problem to contend with, and it’s difficult to think of anytime in the future when search will be less important.”
The story of how Google got started is destined to become part of the Stanford lore. At Stanford, Brin had been studying information extraction from unstructured sources, search engines, data mining techniques for two years and was working on his dissertation when he and Page started thinking about combining their research. And the Stanford-Google project was begun. The Stanford-Google Research Project, was code named “Backrub” referring to their technology that analysed the back link structure on the Internet. But Page thought another name would be better for a commercial enterprise. They briefly considered the name, “Whatbox” but through it sounded too much like “Wetbox”, which according to Page, “might be taken to be a porno site.”
Where did the name Google come from? No, Google is not baby talk. It is a technical term, or at least a derivative of the technical term, googol. A googol is a term invented by mathematician Edward Dasner, who sought expert naming advice from his googling infant nephew, Milton Sirotta. It is supposed to reflect the company’s mission: to organize immense amounts of information available on the Web.
Soon students all over the Stanford Campus were googling. But, according to Brin, “ We needed more computers to handle our research and we realized we needed some angel funding. Brin and Page met with a professor they had come to know through the computer science department, David Cheriton. The meeting apparent went well. At 11 PM that evening Page received a call from Cheriton, “Can you meet tomorrow morning at 8 AM with, Andy Bechtolscheim, who had been one of the co-founders, the first employee of Sun Microsystems. In the meeting the next morning, according to Brin, “After talking for an hour or so, Bechtolscheim said, ‘Oh, we could go on talking about all sorts of issues, but why don’t I just write you out a check?’” The conversation came to a pregnant pause, as Brin and Page looked at each other.
Neither Brin nor Page seemed to have objections and the deal was done. What seems most curious about that transaction is that neither party was really clear what the deal was. There had been no real agreement of terms, let alone negotiation about what percentage of ownership Bechtolscheim’s and Cheriton’s, $100,000 investment was buying. After the meeting, Brin and Page, didn’t even know what to do with the check. It was made out to “Google Inc.”, and they didn’t have a “Google Inc.” checking account. The check sat in Page’s desk drawer for almost a month. But Page and Brin were not idle. In short order they had raised close to a million from other angel investors including $200,000 from Ram Shriram, who was president of Junglee and Vice president of Business Development at Amazon.com.
Brin and Page labored in the proverbial Palo Alto garage for almost two years during which time they met with many industry heavyweights to pitch their technology including David Filo and Jerry Yang who a few years earlier had gone through the same ritual in starting Yahoo! When, Brin and Page had approached Filo and Yang they wanted to licencing their technology to Yahoo! One common misconception is that Yahoo! started out primarily as a search engine. Says, Moritz, “Don’t forget that Yahoo! has never had its own search technology.” In actuality, Filo and Yang were creating a directory of Websites to help organize information on the Web. But that is quite different from creating a search engine. Then as now, Yahoo contracts elsewhere for search capabilities. They have been through several including Simple Text, Alta Vista, Inktomi, and most recently Google. Today, the 40,000 square foot, Googleplex includes a workout room, showers, an air hockey room, masseuse room, personal chef, dining room/cafeteria, a coming baby grand piano in the lobby for company parties, concerts and sing-a-longs. Several company employees are accomplished pianists and Page plays a mean saxophone.
In March of this year, these two twentysomething former Ph.D. candidates from the Stanford computer science department, officially ratified their arrival into the big leagues and hiring “adult supervision” in the form of former CEO of Novell, Eric Schmidt to serve as Chairman of the Board. Says, current CEO, Page, “With 200 plus employees, we’ve entered a phase of our growth where we need adult supervision. But actually we already had it, with John Doerr and Michael Moritz on our board.” Very adult supervision, indeed.