I just finished reading "The Google Story." It is a really good read. I love learning how great businesses got started. Like so many startups, Google was the result of stumbling onto something that became a great idea. And then a great business.
Sergey Brin and Larry Page became friends at Stanford. The both were PhD candidates in search of a dissertation idea. Both advanced through undergraduate studies at an accelerated pace. They already knew most of the stuff being taught before they even arrived. Both came from families where the parents were academics. Mathematics and computers were a breeze to both.
They were frustrated with how Yahoo and Alta Vista did search. Neither company was very good. One day one of the guys announced they were going to download the entire Internet to their computer. Radical! But since they were whizzes, no one really laughed at them. Obviously, it was not an easy task and Google is still working on the ever burgeoning amount of data on the Web. But look at any search result and you will see the word "cache." That means that even if a website no longer exists, Google still has a copy of it on their massive database.
What I did not know was exactly how Google does what it does in terms of search. The book did not detail the entire secret sauce but the basic ideas were there. First, their computers "Crawl" the net copying and indexing every page. This required massive amounts of computing power. Even in their very early days they were buying standard, basic PC's 80 at a time. They use Linux and proprietary software to connect these computers in a massive supercomputer. Second, they came up with complex algorithms for determining the number and value of a link to a website. They then rank websites in terms of importance and content to display incredibly accurate results. A link from Yahoo to your page is much more important than a link from my website. Their computers figure all of this out.
I have always said that great products are only built by fanatics. Fanaticism was certainly a hallmark of everything they did regarding search. For a number of years they only did search. They did not place context sensitive ads next to the search results. They were totally focused on being the greatest search engine ever. The problem was, they literally had no idea how they were going to make money. None. It was not till later that they hit on the idea of ads. Then they became a money making machine. They solved a major problem (search) and then figured how to turn it into a real business. As of today Google is worth $177.6 BILLION. Not bad for not knowing how they were going to make money. The last 12 months their sales were $13.43 Billion clearing a nice $5.12 Billion in profits. They are only about $100B shy of the value of Microsoft and closing very fast.
A few things that stood out to me as observations:
1. The authors, Dan Vise and Mark Malseed have totally drunk the Google punch. I can't think of a single thing they said that was negative. Except perhaps the fact that Google definitely compromised when they entered the Chinese market. They gave into the demand from the government to censor all the searches. They struggled with this but in the end, the lure of the revenue potential in China forced them to compromise their principles. Especially in the last chapter the authors go off the deep end with effusive praise. Larry and Brin are the potential saviors of the entire world. They detailed how Google and it's founders were positioned to solve many of the major problems facing the world. And they were doing it out of the goodness of their heart. Right!
2. I was stunned with the scale of the computing power that Google has amassed. It involves literally millions of computers all over the world. Nothing compares to the massiveness of their operations.
3. I was also stunned with the simplicity and brilliance of the core of their business. In reality, nothing they do is simple. The complexity of their ranking system and methods for placing ads is amazing. But the core is very simple, even brilliant. DuPont once said, "When the answer is found, it will be simple."
4. Over the next many years Google has the potential to be a very scary and evil company. The amount of information that they control and the monopoly that they are amassing is mind boggling. Even they recognize the potential for misuse of the info in the wrong hands. What is their solution? Their one motto. "Do no evil." The CEO, Eric Schmidt, was asked "who decides what is evil?" He answered, "Sergey does!" WOW! All that power in the hands of one genius? That is really a scary prospect. Say he is the most moral man on earth, what happens when he is gone? What happens 50 years from now if Google continues on its path? The potential for "big brother" knowing every detail of every life is entirely possible. Much of this already exists in part in many databases e.g. credit card info, travel records, medical records etc. But those are all disparate systems. Google has incredible data on so many details centralized. Granted, most of it is currently not personalized to each of us. Or is it? They have registered profiles of perhaps hundreds of millions of people. They readily could maintain records of searches done by each person. Plus, they can provide any information on us that is publicly available. I am not accusing anyone of anything. I am just saying the step from where they are, to terrible abuse is a very short step. Perhaps not now, but history is replete with how governments and groups have misused information. Available with a simple search. And dynamically growing every single day. The words I write right now will be cached and searchable tomorrow.
I recommend the book to you. It really is a fun read about one of the most amazing companies of the past 100 years. Enjoy!
