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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....
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.