August 06, 2005

The Birth of a Superstar: How Google Came Into Being

An upcoming book on Google traces two founding ideas behind the company to their inception

As Google Inc. stock price more than tripled in the ten months since its IPO, perplexing Wall Street analysts who are unable to decide "whether to be impressed, suspicious or amused" by the astounding growth (but continue to recommend the stock all the same)... here's a Google question to ponder:

Which one of the following inventions is the greater contributor to the phenomenal success that Google enjoys today?

  • Larry and Sergey's page-rank algorithm that powers the search engine which solved the problem of the poor search user experience of late 90s, acquiring fan following of millions of users in the process.

  • or

  • Bill Gross' pay per click advertising model conceived at (now Overture) that Google latched on to early in its evolution and ran with it, spawning a multi-billion dollar search industry.

If you think Google's great technology is behind its success, think again. What good would the search engine have been to its founders had they not found a way to make a business out of it? What if Bill Gross had not conceived the pay per click model that Larry and Sergey adopted? (Google was taken to court over the patented idea and eventually had to settle outside the court).

So how did Google rose to what it is today? Is it the technology or the way they made money with the technology? The answer of course, is both. You can't choose one ignoring the other. And these are just two of the many founding ideas that continue to drive Google's success. Some of the other, rather well known ones are the company's unique culture that fosters innovation, its stringent hiring practices that ensure they hire only geniuses and its intense focus on solving users most important problems with unique products.

I've been waiting for ages to read a book by a Google insider that would give a real insight into the minds of Larry and Sergey and the company they are creating. There have been quite a few books written on Google but these are how-to manuals on making the most of the search engine. I'm not interested in Google hacks. I want to know what kind of childhood Sergey and Larry had, about the capitalist dream of a business they have created and how it's influencing other businesses, how is it that they continue to do the right thing in every imaginable way, and whether so much of a good thing can really last.

John Battelle's upcoming work "Search: How Google and Its Rivals Rewrote the Rules of Business and Transformed Our Culture" is the first book that comes close to what I describe above. I can't wait to get my hands on it.

Back to topic, John's book carries detailed accounts of the two inventions I mention above that led to the creation of $80 billion of capital at which Google is valued today. Here are the two insightful excerpts:

Larry meets Sergey. They hate each other. They come up with page rank. (Wired)
Bill Gross discovers an arbitrage opportunity. Invents pay per click ads. (Battelle's blog)

Related Links
Recent story in The Economist on Google's growth
Google, competitors and the forgotten problem of poor search user experience
Cnet stories on the patent dispute: Overture Sues Google, Google settles dispute
John Battelle's Book and his blog

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