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Google Plans an IPO
Rich Jones writes "According to this story over at the BBC
every geek's favorite search engine is contemplating an IPO. " Hopefully this wouldn't effect the lean mean searching that I've come to love from the unquestioned king of search engines. Now that the hype surrounding IPOs has fizzled, its nice to see a company that looks as good as Google thinking about it.
No company that relies on banner ads for revenue is ever going to be successful again, not even when they provide the value that Google's do (they're cheap, and work pretty well, but that's not a real business model, kids). I'll stand by that prediction -- not too brave of me.
GOOGLE MAKES MONEY LICENSING USE OF THEIR ENGINE.
Yahoo! pays to use it (although they didn't buy access to the entire page index, so a direct Google search will often give better results). So do about 50 other major companies. When I say 'their engine' I mean the many Googleclusters in Santa Clara, Sunnyvale, and (I believe) Herndon, not just the software.
Some of my friends and ex-coworkers work there -- "Nobody at Google ever quits" they say, and aside from contractors, this appears to be true. It is a wonderful work environment and they have filled their cubicles with Microsoft Research caliber PhD's and ex-professors. They are working on image retrieval technologies (not truly useful yet) and have pretty much cornered the search-engine-ASP market. (In fact, since I last talked to anyone at Google about this, they've added ANOTHER 70 PARTNERS!)
The technology rules -- I have converted every single employee at my current company (far from an IPO, but profitable nonetheless) to using the Google Toolbar because it saves so much time. (and they in turn have converted most of their acquaintances...) If things continue this way, not only will they be an attractive investment, but vast numbers of potential investors may habitually use Google the way they use Microsoft's site. If things go REALLY well, even Microsoft may end up using Google for their search services. That's damn good awareness. And that is why I say...
I STILL HOPE THEY DO NOT IPO YET.
Not just because I doubt my erstwhile coworkers will cut me in for friends-and-family ;-) but because the market is atrocious and I, like (I pray) most /. readers, would want to see them rewarded for superior technology and hard work, rather than having a fair-to-middling IPO due to the .com spectres. If revenues continue to increase (and I believe they will -- Google's search engine is lightyears ahead of new entrants like Teoma due to its already being deployed and well tested), a Google IPO in a year or two would probably be a huge hit, as it may catch the economy coming OUT OF a dip.
Marc, Shawn, Chris, and everyone else at Google, you're doing a great job, and I will buy into the company's IPO either way. But I hope Doerr and Brin and Page, or whoever would be making the decision, decide to hold off a little bit!
Remember that what's inside of you doesn't matter because nobody can see it.
Hopefully this wouldn't effect the lean mean searching that I've come to love from the unquestioned king of search engines.
Actually, I hope that it continues to effect that sort of searching, and that an IPO doesn't affect it negatively....
Some other dead ends:
You get the idea... often a sub-optimal but very well understood approach will be significantly more usefull then a theoretically superior but unworkable approach. With the rate of change of the internet, I don't know how else you could possibly keep up to date.
I am amazed at how good a job Google does every time I search. It's performance and accuracy are nothing short of astounding if you understand the nature and size of the solution space they cover.
Bill
Mathematically impossible requirements are technically not against policy.
Google uses keyword searching. I've said it before, and I'll say it again. Keyword searching is a Dead-End Technology. It scales badly, throws too many false positives and too many false negatives, and makes no allowance for international variations in spelling.
Keyword searching by itself is a dead end. But Google isn't just keyword searching. Google's real strength is it's ability to distill information from links to and from web pages. Google effectively makes ever web page author an intelligent indicer. Google pulls out previously ignored data on the value of a web page. In short, Google works.
Keyword searching scales badly? Compared to what? There is no magical way to avoid looking at every page and doing some form of analysis. Every search engine needs to pay roughly the same price to build up their data set. As for searching, quickly collecting results from an optimized database is fast. Database work is a heavily studied and optimized area. Search cost should be sub-linear to the size of the database.
International variations? If you mean regional variations on the same language, it's solvable by keyword equivalence lists. Many search engines already know to search for misspellings and different conjugations. Again, what would you suggest to replace it?
But in a few years time, will Google be any more useful than Altavista? Google is already more useful than Altavista (in most areas). All Altavista can do is catch up to Google. Meanwhile Google can explore further improvements. If Google is foolish enough to sit on their laurels, they'll be overtaken by someone with a clever idea.
If not, then the investors would be better throwing their cash into an R&D house that might actually produce some long-term return.
Investors don't look three years into the future. They might see two years. Probably only one. Long term research is a fundamentally risky investment. Many times you don't develop something useful, you just discover things that don't work. Don't expect investors to sink money into big maybes.
All in all, it's a bit silly to predict doom for one of the most effective search engines without having a better idea to point to. Researches are working on better searching. Google itself came from such a project. I expect Google is doing some of that research itself.
It appears that either:
There is, among the public, some bizarre fascination with IPOs. For some reason, people think that your business isn't a "real" business until it makes a public offering. Come ON people! Companies go public for money - that's ALL. Look at the privately-held companies that are many times as large as little startups as Google (I used to work for one: Watkins Motor Lines, part of Watkins Associated Industries: $1B plus in revenues). If you're making money, it's not necessary to sell public stock.
What'dya mean there's no BLINK tag!?
Just check out their beta image searching technology with the search term 'slashdot'.
Matt
- The company is owned by a select group of founders and investors, instead of a large anonymous mob of stockholders. The founders and investors are likely to know what's better for the company than stockholders seeking only returns on their investment.
- A private company's growth is a direct function of revenue, profit, and cash position. It's growth is a direct result of it's past successes. An IPO creates an unnatural influx of cash that the company didn't "earn" and doesn't necessarily know what to do with. It permits the company to spend money on things they wouldn't DREAM of spending money on if they were still private. In other words, it permits the company to make decisions and do things that are not necessarily good business.
- Sometimes what's best for the company is NOT growth and profit. R&D, poor market conditions, etc. -- any number of reasons to lay low. But stockholders demand PERFORMANCE, dammit! Private companies can employ more restraint.
- Private companies grow organically and typically foster a great deal of employee loyalty and a unique culture. Public companies grow way too fast and acquire smaller companies, destroying said loyalty and culture.
- All too often, going public has nothing to do with what's good for the company, and everything to do with pure, unabated GREED. It all has to do with a few people who want to get very rich very fast. I say screw 'em. They should earn their fortunes the old fashioned way instead: WORK.
Just looking around, I would say that a great deal of what's BAD about America is publicly held corporations. Since when is what is good for stockholders good for America? Big picture here, folks. I say better to have thousands of small private companies than 4 large public corporatations.Tim O'Reilly has stated more than once that he has no intention of bringing O'Reilly public (for many of the reasons I mention above). I applaud him for doing the right thing. Google shouldn't go public. They should succeed on their own merits.
Think of Google's strengths: low powered non wintel servers delivering fast pages with high quality and low download times with caching and a nice inline sponsor system.
Google is everything that DotCom '99 WASN'T...it is neat, but without flash or fancy...in fact, the style of google is definitely lowtech (it looks the same on Lynx as it does in IE). Google really was the start of a new wave of successful content, and they're no doubt making tons of ducats leasing their machines and technology to anybody who needs to search...and it's actually GOOD. Hell, Google picked up my webpage AND I NEVER EVEN SUBMITTED IT. Neither did any of my linkers submit their pages...Google genuinely crawled to it, and even cached it (not a big hit...my front page is maybe 2k). Furthermore, surfers trust google because of it's high quality...it has no need to build a brand, because WoM has more than succeeded.
If Google goes IPO, and manages to remain of high quality, it means the beginning of a new Dot com boom -- one based on everything the original wasn't, and uncovering the type of quality necessary to bring the web into the age of frictionless content we've needed. No banner ads, no obtuse simulacrums of greatness, just the same basic faced technology that make the toaster or the 24 oz. drinking glass such insanely great inventions.
Hey freaks: now you're ju