Google, Inc.

2400 Bayshore Parkway
Mountain View, California 94043
U.S.A.
Telephone: (650) 330-0100
Fax: (650) 618-1499
Web site: http://www.google.com

Private Company
Incorporated: 1998
Employees: 400 (2001)
Sales: $65 million (est.)
NAIC: 541512 Computer Systems Design Services; 514191 Online Information Services

Chances are, if you’ve ever searched for anything on the Internet, you’ve discovered Google.com. Chances are also, once you’ve discovered Google.com, yours is one of over 150 million Internet searches that Google.com handles a day. With reliable and almost instantaneous results (the life span of a Google query normally lasts less than half a second), Google claims one of the widest audiences among Web sites, with 3 billion searchable documents and more than 21 million unique users per month. A dot-com company that made it, Google Inc. has not only survived, but is making a profit. Credit is given to top-rate technology, a rare sales model and an aggressive vision for what’s ahead.

Google Conceived at Stanford

Google, Inc., the developer of the award-winning Google search engine, was conceived in 1995 by Stanford University computer science graduate students, Larry Page and Sergey Brin. Their meeting at a spring gathering of new Ph. D. computer science candidates launched a friendship and later a collaboration to find a unique approach to solving one of computing’s biggest challenges: retrieving relevant information from a massive set of data.

By 1996 this collaboration had produced a search engine called BackRub, named for its unique ability to analyze the “back links” that point to a given Web site. Continuing to perfect the technology in 1998, Page and Brin built their own computer housing in Larry’s dorm room, a business office in Sergey’s room, and Google had a new home. The next step was to find potential partners who might want to license their search technology, a technology that worked better than any available at the time. Among the contacts was David Filo, a friend and Yahoo! founder. Filo encouraged the two to grow the service themselves by starting a search engine company.

BackRub Becomes Google

The name “Google” was chosen from the word “googol,” a mathematical term coined by Milton Sirotta, nephew of American mathematician Edward Kasner, for the number represented by 1 followed by 100 zeros. A googol, or google, represented a very large number and reflected the company’s mission to organize the immense, seemingly infinite, amount of information available on the World Wide Web.

Unable to secure the financial support of the major portal players of the day, cofounders Page and Brin decided to make a go of it on their own. They wrote a business plan, put their graduate studies on hold, and searched for an investor. They first approached Andy Bechtolsheim, founder of Sun Microsystems, and friend of a Stanford faculty member. Impressed with their plans, Bechtolsheim wrote a check to Google Inc. for $100,000. The check, however, preceded the incorporation of the company, which followed in 1998.

Shortly after its incorporation, Google Inc. opened its new headquarters in the garage of a friend in Menlo Park, California. Their first employee was hired—Craig Silverstein, who later became Google’s Director of Technology. By this time, Google.com was answering 10,000 search queries a day. Articles about the new Web site with relevant search results appeared in USA Today and Le Monde. In December, PC Magazine named Google to its list of Top 100 Web Sites and Search Engines for 1998.

Google Signs Its First Commercial Search Customer

With the number of queries growing to 500,000 a day, and the number of employees growing to eight, Google moved its offices to University Avenue in Palo Alto in February 1999. With interest in the company growing as well and Google’s commitment to running its servers on the Linux open source operating system, Google signed on with RedHat, its first commercial customer.

By early June, Google had secured $25 million in equity funding from two leading venture capital firms in Silicon Valley: Sequoia Capital and Kleiner Perkins Caulfield & Buyers. Staff members from the two investors joined Google’s board of directors. Joining as new employees were Omid Kordestani from Netscape, who became Google’s Vice President of Business Development and Sales; and UC Santa Barbara’s Urs Holzle, who became Google’s Vice President of Engineering. Having again outgrown their work space, the company moved to the Googleplex, their current headquarters in Mountain View, California.

Google continued to expand in many ways. AOL/Netscape selected Google as its Web search service, helping push daily traffic levels to over 3 million. The Italian portal Virgilio and the UK’s leading online entertainment guide, Virgin Net, signed on as well. PC Magazine awarded Google its Technical Excellence Award for Innovation in Web Application Development and included it in several of its “Best of” lists. Time magazine named Google to its Top Ten Best Cybertech list for 1999.

The Google Culture Evolves

Although the company grew rapidly, it still maintained a small company feel. The Googleplex helped nurture an atmosphere of innovation and collegiality with its exercise balls, lava lamps, workout room, grand pianos and visiting dogs. Sophisticated computer equipment was originally set up on wooden doors supported by sawhorses. Charlie Ayers, former cook for the Grateful Dead was hired as company chef. Twice-weekly street hockey games were held in roped off areas of the parking lot and weekly staff meetings were held in the open space among employees’ desks.

Improvements to the search engine itself came in the introduction of the Google Directory, which was based on Netscape’s Open Directory Project, and the ability to search via wireless devices. Thinking globally, Google also introduced ten language versions for search users.

In May 2000 Google received a Webby award for Best Technical Achievement for 2000 and a People’s Voice Award for Technical Achievement. The following month, Google introduced its billion-page index and, with 18 million search queries per day, officially became the world’s largest search engine.

Google Launches Keyword-Target Advertising Program

A number of clients in the United States, Europe and Asia began signing up to use Google’s search technology on their own Web sites. By launching a keyword-targeted advertising program, Google added another source of revenue. On June 26, the company’s reputation was further solidified with the announcement of a partnership with Yahoo! Other partners adding Google to their sites were China’s leading portal NetEast and NEC’s BIGLOBE in Japan. In an effort to extend its keyword-advertising to smaller businesses, Google introduced AdWords, a self-service advertising program that could be activated with a credit card. Google Number Search was launched, making wireless data entry easy and faster. Other awards received included the addition to Forbes’ Best of the Web Round-Up, PC World’s recognition as “the Best Bet Search Engine” and the WIRED Readers Raves award for Most Intelligent Agent on the Internet. PC Magazine UK honored Google with their Best Internet Innovation award.

By December, Google was answering more than 60 million searches per day. The Google Toolbar, a highly popular innovative browser plug-in, was introduced in late 2000. Searches could be generated from a Google search box and by right-clicking on text within a Web page and highlighting keywords in results.

Reaching the 100-million search mark per day in 2001, Google acquired the assets of Deja.com and integrated all the data in Deja’s Usenet archive dating back to 1995 into a searchable format. Google PhoneBook was launched, providing publicly available phone numbers and addresses search results. By early 2001 Google was powering search services at Yahoo! Japan, Fujitsu NIFTY and NEC BIGLOBE, the top three portals in Japan, as well as U.S. corporate sites, Procter & Gamble, IDG.net, Vodaphone, and MarthaStewart.com. Dr. Eric Schmidt joined Google in May as chairman of the board of directors and would eventually become CEO. Schmidt had previously served as chairman and CEO of Novell and CTO of Sun Microsystems.

Company Perspectives:

Google’s founders have often stated that the company is not serious about anything but search. They built a company around the idea that work should be challenging and the challenge should be fun. To that end, Google’s culture is unlike any in corporate America, and it’s not because of the ubiquitous lava lamps and large rubber balls, or the fact that the company’s chef used to cook for the Grateful Dead. In the same way Google puts users first when it comes to our online service, Google Inc. puts employees first when it comes to daily life in our Googleplex headquarters. There is an emphasis on team achievements and pride in individual accomplishments that contribute to the company’s overall success. Ideas are traded, tested and put into practice with an alacrity that can be dizzying. Meetings that would take hours elsewhere are frequently little more than a conversation in line for lunch and few walls separate those who write the code from those who write the checks. This highly communicative environment fosters a productivity and camaraderie fueled by the realization that millions of people rely on Google results. Give the proper tools to a group of people who like to make a difference, and they will.

The list of search services customers continued to grow throughout 2001 with the addition of Sprint and Handspring. By midyear, Google powered 130 portal and destination sites in 30 countries, with advertising programs attracting more than 350 Premium Sponsorship advertisers and thousands of AdWords advertisers. Click-through rates were delivered four to five times higher than click-through rates for traditional banner ads. Country domains were offered in the U.K., Germany, France, Italy, Switzerland, Canada, Japan, and Korea, with users selecting Google’s interface in nearly 40 non-English languages.

By the beginning of the fourth quarter of 2001, Google announced an achievement that had eluded many other online companies: profitability. With the appointment of Schmidt as new CEO, co-founders Larry Page and Sergey Brin became President, Products and President, Technology, respectively. Google was awarded another Webby, this time for the new Best Practices category.

Cingular Wireless and more than 300 of Sony’s corporate Web sites were linked to Google by mid-2001. The new Google Image Search index was launched with 250 million images. Google Zeitgeist, from the German Zeit (time) + Geist (spirit), meaning the general intellectual, moral, and cultural climate of an era, published results of search patterns, trends and surprises. On a monthly, weekly, and sometimes daily basis, the Google Zeitgeist page was introduced to reflect lists, graphs, and other tidbits of information related to Google user search behavior.

In September, Google purchased the technology assets of Outride, Inc., and partnered with Universo Online (UOL) to provide access to millions of UOL users throughout Brazil and Latin America. On the global scene, Google launched a new tabbed home page interface on Google.com and 25 international sites. The Arabic and Turkish languages were added and the Google Toolbar launched versions in five new languages. Lycos Korea came onboard as well.

By the end of 2001, Google had increased the size and scope of searchable information available through the Google search engine to 3 billion Web documents, including an archive of Usenet messages dating back to 1981. Google News Headlines was added and Google Catalog Search enabled users to search and browse more than 1,100 mail-order catalogs. New sales offices were opened in Hamburg, Germany, and Tokyo, Japan.

With 2002 Comes the Google Search Appliance

In January 2002, Google announced the availability of the Google Search Appliance, an integrated hardware/software solution that extended the power of Google to corporate intranets and Web servers. AdWords Select was launched, an updated version of the AdWords self-service advertising system with new enhancements, including cost-per-click-based pricing.

More honors were received in 2002, including “Outstanding Search Service,” “Best Image Search Engine,” “Best Design,” “Most Webmaster Friendly Search Engine,” and “Best Search Feature” in the 2001 Search Engine Watch Awards. Expansion of global capabilities continued with the launching of interface translation for Belarusian, Javanese, Occitan, Thai, Urdu, Klingon, Bihari, and Gujaratie, bringing the total number of interface language options to 74. Google Compute offered a new toolbar feature to access idle cycles on Google users’ computers for working on complex scientific problems. Folding@home, a non-profit research project at Stanford University aimed at understanding the structure of proteins in order to develop better treatments for certain illnesses, was the first beneficiary of this effort. Google Web APIs service enabled programmers and researchers to develop software that accessed billions of Web documents as a resource in their applications. Awards in mid-2002 included Google’s founders, Brin and Page, being named to InfoWorld’s list of “Top Ten Technology Innovators” and an M.I.T. Sloan eBusiness award as the “Student’s Choice.”

A multi-year agreement with AOL was announced to provide results to AOL’s 34 million members and millions of visitors to AOL.com. Under the agreement, Google’s search technology began powering the search areas of AOL, CompuServce, AOL.com and Netscape. Google Labs was launched, enabling users access to Google’s latest and evolving search technologies. Seven new interface languages were introduced, including traditional and simplified Chinese, Catalan, Polish, Swedish, Russian and Romanian. Global expansion continued with a new office opening in Paris to complement existing international offices in London, Toronto, Hamburg and Tokyo. The 2002 Google Programming Contest, launched in early 2002, announced its first winner of $10,000 for the creation of a geographic search program that enables users to search for Web pages within a specified geographic area.

Key Dates:

1995:

Google founders Sergey Brin and Larry Page meet at Stanford University.

1997:

BackRub, the precursor to the Google search engine, is founded.

1998:

Google is incorporated and moves into its first office in a Menlo Park, California, garage.

1999:

Google moves its headquarters to Palo Alto, California, and later to Mountain View, California; Red Hat becomes Google’s first commercial customer.

2000:

Yahoo! Internet Life magazine names Google the Best Search Engine on the Internet; Google becomes the largest search engine on the Web and launches the Google Toolbar.

2001:

Google acquires Deja.com’s Usenet archive and launches Google PhoneBook; Dr. Eric Schmidt joins Google as chairman of the board of directors and is later appointed CEO.

2002:

Google launches the Google Search Appliance, AdWords Select, the 2001 Search Engine Awards, and Google Compute.

Plans for the remainder of 2002 at Google include efforts to intensify its global push—half the company’s search queries come from aboard—and to expand its corporate search services, which power the Web sites for other corporations. So far Google has amassed 130 clients worldwide including Martha Stewart Omnimedia, Cisco Systems, Sony and Cingular Wireless. As Google continues to grow, some wonder whether it can maintain the culture and focus that has propelled it so far. To Brin and Page, the company’s cautious start has forced it to enter the search services arena with a deeper understanding of the market. At present, it is truly the dot.com engine that could.

Principal Competitors

AltaVista; Ask Jeeves; Inktomi.

Further Reading

Blumenstein, Rebecca and Geoffrey Fowler, Jared Sandberg, Rebecca Buckman, Kris Maher, “Beyond Global,” The Wall Street Journal, March 21, 2002, p. B6.

Cummings, Betsy, “Beating the Odds,” Sales & Marketing Management, March 2002, pp. 24–29.

Swisher, Kara, “Beneath Google’s Dot-Com Shell,” The Wall Street Journal January 21, 2002, p. B1.

—Carol D. Beavers