Google has become the primary source for Internet searching over the last few years. It upcoming Initial Public Offering is drawing a lot of buzz from Wall Street, but do the $treet types get what Google's about, and will their misunderstanding kill its public aspirations?
In a very short time, Google has become an Internet powerhouse. It is widely praised as an example of how ingenuity can outpace huge size and capital competitors. With operating mottos such as, "Don't Be Evil", and "Democracy on the Web Works", Google has also been an unconventional counterpart to many of the captial-consumed Internet companies. All of which is pretty good for a company that was started by two not-quite graduated computer science students from Stanford.
When the IPO was announced, it was touted by many to be the beginning of the rebirth of the Internet economy. Not only is that a lot to pin on one company, it's also well outside of Google's own stated goals. You can read in their SEC Filing about their primary motivations, and untenable growth and massive revenues are not in there. Google's philosophy seems based on old-school solid financials (as practiced by self-professed idol Warren Buffett) as well as a desire to stay ahead of the game with technology and to use their power and position to improve their community. While many may consider this a naive enterprise, I want to see it suceed, as it's a naive vision I share, and would like to create with any company I eventually controlled.
But its a vision that cannot succeed without the genuine support (and belief) of it's shareholders. And given that people don't read the owner's manual for their VCR, let alone their investments, it's a message that most people won't get, and will listen only to the crowing on Wall Street. This is bad news for a company with a long-term vision, hoping to be an "unconventional" company, as last quarter's Earning's Per Share is all that's important to the Street.
Notes:
Google's SEC Filing (read the opening letter (hyperlinked here) which spells out Larry, Sergey, and Eric's vision for the IPO.)
One way Google is attempting to distance itself from the Wall Street machine is by making its initial offering as a "Dutch" auction. This is similar to the bidding of the same name found on Internet sites like ebay, and has been used ocassionally for such disbursements, but never in a company so large. Reaction seems to be mixed on whether this is triumph or travesty.
One extra nerdy note: Google's initial offering is 2.71828... Billion shares, a number many of the geekiest among you (i.e. people like me) should recognize.
Posted by ktismael at May 10, 2004 11:56 PM