FYI this article is adapted from my book on Google out next month. There are generally two types of book excerpts: those that reprint a discrete section or those that draw from the whole to stitch together an article reflecting the reporting. This one is the latter--when Google announced that Larry would be the CEO, Wired (which secured the serial rights) chose to focus on him. I drew on anecdotes throughout the book, as well as interviews with Larry, to produce this.
I'd like to see him break Google up in to individual product "companies", each with their own office, corporate hierarchy, balance sheet, and near complete autonomy.
Larry would act as the investor, and anyone inside the company could come ask for money to found a new "company" or for additional funding. Every company would start out with some kind of "shares" to be distributed by the founders (with vesting, etc). If a company fails the people would actually lose their jobs. If they succeed the equity would be worth some proportionally huge amount.
I don't think any company has ever tried to truly simulate startups on a scale like this while maintaining the upside and downside of a real startup.
It's just crazy enough to work and he's just crazy enough to try it.
That's likely to shut down many, many Google services, though. So many aspects of the company are funded by search advertising. Maintaining an "investor" relationship in them would be a huge distraction.
I hope they continue down the "change the world" path by continuing to look at how their expertise in data analysis and AI can do more (like self-driving cars).
Cypress Semiconductor is a lot like that, with individual teams in competition with one another for funding and resources.
You seem to be making it more extreme with people losing their jobs on failure. One of the advantages of having a big company is that you get to attract good people that are more risk adverse and to assign good people to projects more easily. If you let go of that I'm not sure what's the difference between what you described and a VC fund.
When a project has 200 engineers and 50 in "overhead" (designers, marketing etc.) behind it though, and you break it off - how is that a startup? It's still a 250-person company. I don't see how just cutting it off restores agility that a tiny team with a nascent project has. A large project has more stuff to break with more people that need more links to communicate, increasing the inertia of the whole thing and slowing it down.
What might be possible is some type of Skunk Works with independent leadership, which generates new ideas but leaves the fleshing out to the rest of the company. It wouldn't be associated with longterm management of one project though, more as an incubator and consultancy that spins off and checks in on projects they initiated.
>200 engineers and 50 in 'overhead' (designers, marketing etc.)
Is this a deliberate attempt to troll or are designers nothing but overhead? Poor design, particularly poor interface design, is considered a major factor in many of Google's product failures (Wave, Google TV, Buzz, et al). User interface design and consistency are frequently cited as the largest remaining gap between the Android and iOS experiences.
And in fairness, Wave and Android are hardly perfect examples of engineering. Wave was buggy and never added significant features, Android is still sluggish compared to iOS on similar hardware.
Google tends to lack clear direction/leadership/vision at a product level, not just UI design.
I'd have to heartily agree with this sentiment. While oftentimes I think we do see engineers get marginalized in favor of "business" employees or designers to disastrous effect, it's important to recognize the importance of UI/UX, especially on consumer-facing products. While Apple and its extreme focus on UX is the most prominent example, many web startups have seen success due to a combination of good marketing and design (Tumblr, Facebook (vs. Myspace), Instagram, and Flipboard come immediately to mind).
To be fair, a lot of Wave's problems could've been nipped long before it got to the designers. The app was just plain slow. Speed is a quality all of its own.
That's sorta what Slingshot Labs was with News Corp. They were a separate company but were funded by News Corp with the goal of innovating and generating new "startups". Employee's had equity in the company.
I don't think its going to happen and I don't even think he means itwhen he says that he wants to take Google to be a startup again. I think it's a publicity stunt to attract talent. Just like their "Do no evil" tagline.
One of the things I admire about Larry is that 'impossible' doesn't seem to be in his vocabulary. The challenges of having Google be more 'startupy' are many, some that immediately come to mind;
* Part of the allure of joining a smaller organization is that you can have a huge impact, creating a business from nothing to $10M/year is huge. At Google adding $10M/yr to the bottom line is chump change and you're a chump if that's all you can do.
* One of the great things about smaller organizations is that not only does everyone have a general understanding of the big picture, they have a lot of respect for each other too. Google has grown so complex in its execution that nobody could honestly claim to know how it all works, and of the few who come closest they can't scale to be as many places as they need to be. There is an inverse square law that your level of respect at Google is 1/Jd^2 where Jd is your "Jeff Dean" number.
* Start ups in particular get focus from solving a problem that is painful enough that someone will pay you for your solution, Google invents problems that nobody has and then has to give away their work to get any traction at all.
* Start ups can fire their hardware vendor, pick and choose their own software, build methodology, hiring practices. All of those things are mandated at Google.
Next up I'm afraid is a big poster imploring people to ask themselves, "Is this good for Google?" That would be sad indeed.
I know adults who would like to simplify their lives to get back to a lifestyle that is more like the one they had in college. That is perhaps equally difficult.
>* Part of the allure of joining a smaller organization is that you can have a huge impact, creating a business from nothing to $10M/year is huge. At Google adding $10M/yr to the bottom line is chump change and you're a chump if that's all you can do.
Google has 25,000 employees. I was unaware that on average their yearly income was increasing at 250 billion a year. Impressive.
That is one of their challenges, adding $10M to the bottom line gets you no respect, creating a new cool toy, huge respect. So consequently the best and the brightest don't waste their time trying to do that.
I asked once why this was from an 'old timer' (aka someone who had been there prior to the IPO, was on various promotion committees) and their answer was honest and direct, "We have plenty of money, so adding more is irrelevant, what we need are good ideas so we reward that which we need most." (may not be an exact quote, it was a couple of years ago but its close)
Sadly I could see his point. With nearly $8B of free cash flow (after all the perks/salaries/taxes/gear etc) that's $400,000 for each and every employee (back when they had 20K employees) which they could 'pay out' on a whim to individuals (if they chose to). How do you make that feel more "startup like"? I think the challenge would be akin to Prince William trying to make the living experience in Buckingham Palace more like what homeless people feel. Not impossible but very very difficult I suspect.
This is a gimmick. Google did lots of evil things hiding behind its motto of do no evil. Similarly this is only a mechanism to attract smart kids out of the college with an allure of high paying "startup". Google can't be a startup again. It's a public company. Too many people's too much money is betting against it.
The one thing a billion dollar corporation can't do is be a startup again. There's too much at stake.
If you are truly a passionate early-stage founder, then the only option is to leave. Of course, Ellison, Gates, Jobs would never do this (willingly, anyway, in the latter case), because they'll never hit another homerun that big. If Page left it would be a pretty big stake in the ground.
I don't think this is true at all. Jobs re-invented Apple in about 6 years and did an amazing job with it. Being a startup means lots of things. At the core of it is to stop worrying about what you have to lose. Apple was able to do this because they had already lost. Google may be able to do this before they lose in any meaningful way because that's Larry's personality. If Larry can do half the job that Jobs did in setting the bar for his company (vision, execution, product quality) then Google will do really well for the next ten years.
Without Tim Cook's ability to execute, Jobs' vision may never have come to pass. One person can't do it all, and, in particular, I don't think you can effectively be visionary and "execution-ary" at the same time. I think that will be one of Larry's biggest challenge.
So giant corporations that were founded in the 1970s are startups too? I guess "startup" is just a state of mind then. Maybe we're all in startups and we don't even know it!
"Being a startup" is not a binary condition. Startups possess many admirable traits and many big companies manage to capture some or many of these. And many startups have problems like politics or bureaucracy that you find in big companies. Saying that a startup is somehow conditioned on the number of employees you have is a naive definition of startup.
Clearly there are many big companies that have some of the burdens that come with that. And at the same time many big companies have managed to dominate industries for decades, make huge pivots, and innovate in new areas far better than startup competitors. IBM did a huge pivot in the 90s. Apple made a huge pivot in the late 90s. Xbox Kinect is actually some pretty amazing technology. Google building self driving cars is an amazing innovation.
To say that big companies can't be lead through big changes, can't be entrepreneurial, can't make pivots, can't bet their brand on one big vision/product/push, or any other trait we admire in startups is ignoring history and reality.
Jobs left and was rehired with the specific mandate to make Apple profitable, at a time that Apple was in deep trouble. Google is in a very different situation.
What if Larry Page decides he wants the future is to colonize the moon. Then, he decides to invests all or a large portions of Google's money in colonizing the moon. Will anyone stop him? Would this count as a startup again?
Still effectively zero ROI though. Been there, done that, and all we got to show for it was a couple rocks and a money pit space station. Personally I'd vote for Larry using his billions to refund the Superconducting Supercollider. Now that would be one hell of a startup.
Not that it wouldn't be great to see it started up again, but how is the supercollider any less of a money pit than the ISS? I can hardly see it being a profitable business plan for a startup...
I was just joking about SSI as a startup, but I'd wager that unlocking the secrets of the fundamental particles of the universe has a great deal more potential than even ISS's best experiments.
One of our biggest problems re space exploration and colonizing other planets is that our energy and propulsion systems suck for the task. Imho, materials science, nanotech, and further drilling down into sub-atomic mechanics is where we're more likely to make breakthroughs in things like energy generation, storage, and efficient propulsion.
Colonizing != visiting. There're many possible economic benefits of colonizing the moon - new sources for rare minerals, reduced population pressure on earth, and a launch pad for future interplanetary missions are some of the major ones.
And getting all those minerals back to Earth, and building sustainable communities on the moon, costs as much or more than the value derived, hence zero ROI. And we're not going anywhere in space till we have more efficient propulsion than we have now. Isn't the energy/propulsion problem the one we should be focusing on first?
Why would you bring those minerals back to earth? You mine minerals on the moon so you can manufacture things on the moon, so that you can build the machinery necessary to visit other stars outside of earth's gravity well, so that you can reduce the energy needed to launch an interplanetary expedition, so that you can solve your energy/propulsion problems.
Oracle doesn't have a sailing team. Larry does, paid out of his own pocket. He just sticks the Oracle logo on his boat because it's his boat and he can stick whatever logo he wants on it.
Instead of going to the moon, he should consider mining an asteroid. Apparently, a 100m Fe-rich near-Earth asteroid contains ~$150 billion worth of platinum. There's at least a potential of ROI.
"To put that another way, if Google managed to scoop up just 2% of that industry they’d have more than doubled their revenue. With their driverless car project, I think they’ve got a shot of taking a much bigger slice of the pie than that."
I'd say it takes more to "do it properly", but I'd recommend reading this nonetheless: http://mattmaroon.com/2011/01/03/google-will-become-an-ai-co...
I'm completely serious. The economic benefits of automated cars are staggering. And I mean trillions in net present value, not trillions in profits per year.
Very good point. When the Spanish raided the Americas and took all the gold home, all they succeeded in achieving was massive inflation. History has an important lessons here.
Count me as one of the guys miffed at everybody calling every little hacked out Rails website as a "startup". But in the case of a moon colony, I'm willing to let it slide.
"Don't be discouraged if what you produce initially is something other people dismiss as a toy. In fact, that's a good sign. That's probably why everyone else has been overlooking the idea. The first microcomputers were dismissed as toys. And the first planes, and the first cars. At this point, when someone comes to us with something that users like but that we could envision forum trolls dismissing as a toy, it makes us especially likely to invest."
And even if its posible I hope it doesnt happen. Along with startup mentality comes risky bets, possibility of fatal mistakes and lack of stability. Google has had an amazing decade and it should continue to innovate within the constraints of a public corporation. AAPL is doing it fine. Jobs never had to take it to its startup roots to resurrect it.
But he has learned that instead of arguing his case with Page, a better strategy is “giving him shiny objects to play with.”
At the beginning of one Google Voice product review, for instance, he offered Page and Brin the opportunity to pick their own phone numbers for the new service. For the next hour, the two brainstormed sequences that embodied mathematical puns while the product sailed through the review.
This was pretty much my experience with getting to choose my own GV number, albeit from a long list of "pre-screened" numbers. Had to stop myself from going through all of them (within an area code) in trying to find a number that was neat / punny / significant.
Ah, my experience as well! I wanted a cool, easy to remember number, and though a good numeric pattern would do. The obvious ones were taken, so I thought about repeated pairs of numbers. I tried all 100 combinations of two digits, and found a number which begins with 42 repeated 4 times. I wish I knew who the lucky person was who snagged 42 repeated for all ten digits!
This part was where I really started getting suspicious of the journalism. Does anyone really think that two very capable, industrious founders fell for the childish puppeteering distraction by a project manager?
Being very capable and industrious does not make a person invulnerable to the indescribable appeal of picking the most awesome phone number possible. In fact, that's probably the only reason I even tried Google Voice.
"Page said, Google should enable users to answer one another’s questions. The idea ran so counter to accepted practice that Griffin felt like she was about to lose her mind. But Google implemented Page’s suggestion, creating a system called Google Forums, which let users share knowledge and answer one another’s customer-support questions. It worked, and thereafter Griffin cited it as evidence of Page’s instinctive brilliance."
A forum? Where users can answer each other's questions? What unconventional brilliance!
It's not like thousands of other companies have forums where users can answer each other's questions.
"Page reiterated his complaint, charging that it was taking at least 600 milliseconds to reload. Buchheit thought, “You can’t know that.” But when he got back to his office he checked the server logs. Six hundred milliseconds. “He nailed it,” Buchheit says."
What preternatural powers of observation Page must have had to guess that a page reload took half a second.
> That was the reaction in 2003 when Denise Griffin, the person in charge of Google’s small customer-support team, asked Page for a larger staff. Instead, he told her that the whole idea of customer support was ridiculous. Rather than assuming the unscalable task of answering users one by one, Page said, Google should enable users to answer one another’s questions.
That explains a few things... I wonder why they they even bothered writing Google Forums, they could have just thrown phpBB at it and call it a day.
Google probably can't become a startup again, but it can probably start some kind of internal startup-like culture to spur internal innovation. If it "funds" groups of employees to essentially build an autonomously run startup (and rewards successes with $$$) it can probably save tons of money over the current acquisition strategy it has (many of which aren't really turning out to be great performers for Google).
With YC level success rates, it could be a great strategy for them.
I think this is the first time I read an article that focuses so much in only one of the Google founders. So far you could only find stories about what the two founders did together, and little about their individual personalities. This kind of article is probably more attractive, and paints Page in a more similar tone than the one people like Gates, Jobs, etc. tend to be written in. Maybe this is a way to make Google look cool too.
I know the answer to that, but I'm not at liberty to say. It is significant, though.
Anecdotally (which I am allowed to say), among the people I've worked with at Google, there have been far more defections to startups than to FaceBook. Many of them ended up at YCombinator. And the people who leave to found their own companies generally seem to be of higher quality than the ones who left for FaceBook - I find I rarely miss the people who defected to FaceBook, while I very frequently miss the ones who've left to found or join early-stage startups.
One could argue that Google have always been 'startup-y' and any 'drain' reports can be attributed to media exaggerations and over-echoing of separate cases - as the media often does.
Regardless this shake-up is set to streamline management which will accelerate the company's decision making
In view of the bashing Alex Payne is being subjected to on another thread for advocating larger than "lifestyle" startups I found this bit interesting (emphasis mine)
"A few ingredients in Larry Page’s stew of traits stand out unmistakably. He is brainy, he is confident, he is parsimonious with social interaction. But the dominant flavor in the dish is his boundless ambition, both to excel individually and to improve the conditions of the planet at large.
He sees the historic technology boom as a chance to realize such ambitions and sees those who fail to do so as shamelessly squandering the opportunity. To Page, the only true failure is not attempting the audacious. “Even if you fail at your ambitious thing, it’s very hard to fail completely,” he says. “That’s the thing that people don’t get.”
Also,
"(Page’s fixation on speed probably drives his notorious bias toward utilitarian—some say boring—design. He maintains a militant opposition to eye-catching animations, transitions, or anything that veers from stark simplicity.)"
gives me hope he'll undo or at the least discourage some of the new bing-ification redesigns of Google Search and news. [rant] A bit of javascript hacking removed the new sidebar from the search page and restored the old classic "just a searchbar" look for me, but the new Google News redesign is terrible and close to unusable (and I don't have the time these days to attempt a JS hack restoration). I would pay to have the old design back.[/rant]
Running the whole company as a startup isn't going to work. But what might work is to build several skunkworks projects within the company with their own CEO's. And if the projects are successful to run the companies as subsidiaries and offer equity (options for the subsidiary, not Google stock) to the people directly involved in the project's success.
I think the biggest difference between startups and established companies (even those that try to emulate a startup like culture) is the hunger for success. Established successful tech companies have already accomplished amazing things and may have cornered or even created the particular market they're in. They typically have several early employees who have made a fortune and many employees who are fairly well off from the company's stock purchase plan. Bill Gates lamented the fact that one of his employees wasn't quite as motivated as he used to be in the following quote (paraphrased): "something about a man changes when his net worth surpasses $100 million"
I had some nibbles from some google recruiters a little while back, but I let it drop. It seemed to corporate. But this article makes me think I should give them another chance.
