The headlines read “Google hits $900.00 a share.” This was the headline on May, 15, 2013. It was the first time that Google’s stock closed above the $900.00 mark. My first thought was, “Why did I sell my Google stock years ago?!”. Once I got over that disappointment it dawned on me the impact of achieving this mountain of an accomplishment. Last year the talk was Apple hitting 1k a share, but it looks like Google will beat them to it. How did a search engine company get here? How much of Google’s success is attributed to co-founder Larry Page?
Who is Larry Page?
Depending on who you talk to, Page is said to be rude and emotionless. On the other hand, there is no dispute that Page is brilliant and a visionary. It should be noted that since 1999, Page has been dealing with a vocal cord nerve disorder. His left vocal cord was paralyzed, hindering his ability to speak. Recently, May 2013, Page acknowledged that his right vocal cord suffered the same fate.
“I like the fact that I can meet anyone now and have a conversation.” -Larry Page
Lawrence (Larry) Page was born on March 26, 1973 in East Lansing, Michigan. Both his mother and father were involved in the computer industry. His father was highly acclaimed in the computer science/artificial intelligence area, while his mother taught computer programming at the local university. Larry Page attended the University of Michigan, where he graduated with a bachelor of science in engineering. He then went on to Stanford University continuing his studies in computer engineering; this is where he met Sergey Brin, his soon to be partner.
How Has Google Become the 800 Pound Gorilla?
Google’s U.S. market share of search engine traffic stands at approximately 70 percent. And lets emphasize “U.S.” because in China their market share is only slightly above 2 percent. The other two competitors, Yahoo and Bing(Microsoft), are hovering just above 6 percent. There are several other search engines that make up the additional 18 percent of search engine traffic.
Larry Page and Sergey Brin both attended Stanford to get advanced degrees in computer science. There they met, and in 1996 developed their first search engine called BackRub. The unique thing about the technology used in their search engine was the creation of “pagerank.” They set out on a journey to license their new found technology to existing search engines, not start their own company.
“If you’re changing the world, you’re working on important things. You’re excited to get up in the morning.” -Larry Page
The first stop was at a company called Excite (you might remember them from the 90’s), which at the time was one of the big players in the search business. The deal fell through because the company wanted Page as an employee, not a partner.
AltaVista was next on their list, and the company nixed the deal because of management disagreements. Yahoo also had their chance to invest in this new concept Page and Brin brought to the table, but they also passed based on opinions that this new technology wasn’t needed.
Infoseek was the pairs last stop, and they were basically escorted out after just a short introduction and told to get lost.
Page and Brin returned back to Stanford not dejected, but determined to move forward and never give up. In 1997 they rename BackRub to Google and thus their new company was born. It didn’t take long for them to secure over a million dollars in seed money, and well – the rest is history.
“I don’t think we’re going to run out of important things to do, compared with the resources that we have. There are many, many problems in the world that need solving.” -Larry Page
What type of Leader is he?
Let’s hear it straight from him:
“My job as a leader is to make sure everybody in the company has great opportunities, and that they feel they’re having a meaningful impact and are contributing to the good of society. As a world, we’re doing a better job of that. My goal is for Google to lead, not follow that.”
“It’s important that the company be a family, that people feel that they’re part of the company, and that the company is like a family to them. When you treat people that way, you get better productivity.”
Larry Page Takes Over as CEO – April, 4, 2011: This was the headline, and Eric Schmidt (former CEO) would now be the Executive Chairman. So, why the change? Schmidt had been at the helm of one of the fastest growing companies on the planet, and quite successful at that so, why change?
There was a cancer Page saw developing, which happens to all companies that experience a parabolic growth pattern – it’s called “bureaucracy.” Yes, Google was getting bogged down both internally and externally. Internally with issues such as development and design, and externally with monopoly and privacy issues.
It only took until June 2011, for changes to begin manifesting themselves. Page had sent the directive down through the chain of commands to redesign Google’s look. Simple, clean, useful, these were the words used by Page for his redesign concept. In three months Google was ready to ship updated design packages of Google Search, Google Maps, and other of its products to market. This was all made possible in a short period of time by Page’s leadership and vision of “common design language for their suite of products.”
Advertising Revenue – as Google maintains its dominance in search, so goes its revenue in advertising. In 2012 Google topped 40 billion in ad revenue and 2013 could be even better. Yahoo and Microsoft’s Bing have joined forces in an attempt to cut into Google’s margins, but people still gravitate to Google.
Mobile – the Android operating system has been a big success, but at a price. As you know Apple takes the cake for its iPhone and end-to-end strategy in this space. Google had to impose a different strategy to gain market share. By licensing its Android OS to manufacturers, Google only make about $1.68 per phone. This is compared to Apple’s healthy $650 per phone, but it seems Google is OK with their profits as long as market share rises.
The Results
Page’s re-tuning of Google’s overall structure and redesign of products seems to be a success among stockholders, potential investors, and employees alike. Achieving $900.00 a share in the stock price is a measurement of success.
“If we were motivated by money, we would have sold the company a long time ago and ended up on a beach.” -Larry Page
Is Page the next Steve Jobs of search engines? This remains to be seen, but he does possess all the characteristics of those before him that were innovators who changed the world – it should be interesting, to say the least. We’ll all be staying tuned – That’s guaranteed.
Awesome story John. Taking a company to that level is no easy feet. Now I’m only wishing I could have bought that stock in the early days.
RIght!? I had them years ago and would’ve tripled what I sold them for. If only I could see the future…haha!
Great story. It’s fascinating to see what Page has done with Google.
Terry, it really is! Similar to Apple and other tech startups. Humble beginnings and grew into an Empire.