The name “Google” is a play on the word “Googol”, which was coined by Milton Sirotta, nine-year-old nephew of U.S. mathematician Edward Kasner in 1938, to refer to the number represented by 1 followed by one hundred zeros. As a further play on this, Google’s headquarters are referred to as “the Googleplex” — a googolplex being 1 followed by a googol of zeros, and the HQ being a complex of buildings (cf. multiplex, cineplex, etc).
The name has also been interpreted as a merging of the words “Go ogle”, though this is widely accepted to be coincidental. The term appears in James Joyce’s Finnegans Wake: “who thought him a Fonar all, feastking of shellies by googling Lovvey”. To “throw a googly” means to ask a difficult or unanswerable question in British slang, a googly being a tricky ball in the game of cricket. Chambers Twentieth Century Dictionary (1972) allows the verb “to google” from this, and the phrase has come to be synonymous with “to search for on the Internet”.
Financing and IPO
The first funding for Google as a company was secured in the form of a $100,000 check from Andy Bechtolsheim, co-founder of Sun Microsystems, made out to a corporation which didn’t yet exist. After a frantic few weeks, this was topped up to give an initial investment of almost $1 million. Around six months later, a much larger round of funding was announced, with the major investors being rival venture capital firms Kleiner Perkins Caufield & Byers and Sequoia Capital.
In October 2003, while discussing a possible IPO (Initial Public Offering of shares), Microsoft approached the company about a possible partnership or merger; no such deal ever materialized. In January 2004, Google announced the hiring of Morgan Stanley and Goldman Sachs Group to arrange an IPO. That IPO (one of the most anticipated in history) was projected to raise as much as $4 billion. According to a banker involved in the transaction, the deal would yield an estimated $12 billion market capitalization for Google.
On April 29, 2004, Google made an S-1 form SEC filing for an IPO to raise as much as USD $2,718,281,828 (with a touch of mathematical humor as e = 2.718281828…). April 29th was the 120th day of 2004, and according to section 12(g) of the Securities Exchange Act of 1934, “a company must file financial and other information with the SEC 120 days after the close of the year in which the company reaches $10 million in assets and/or 500 shareholders, including people with stock options. Google has stated in its Annual filing for 2004 that every one of its 3,021 employees, “except temporary employees and contractors, are also equity holders, with significant collective employee ownership”, so Google would have needed to make its financial information public by filing them with the SEC regardless of whether or not they intended to make a public offering. As Google stated in the filing, their “growth has reduced some of the advantages of private ownership. By law, certain private companies must report as if they were public companies. The deadline imposed by this requirement accelerated our decision.” The SEC filing revealed that Google turned a profit every year since 2001 and earned a profit of $105.6 million on revenues of $961.8 million during 2003.
In May 2004, Google officially cut Goldman Sachs from the IPO, leaving Morgan Stanley and Credit Suisse First Boston as the joint underwriters. They chose the unconventional way of allocating the initial offering through an auction (specifically, a “Dutch auction”), so that “anyone” would be able to participate in the offering. The smallest required account balances at most authorized online brokers that are allowed to participate in an IPO, however, are around $100,000. In the run-up to the IPO the company was forced to slash the price and size of the offering, but the process did not run into any technical difficulties or result in any significant legal challenges. The initial offering of shares was sold for $85 a piece. The public valued it at $100.34 at the close of the first day of trading which saw 22,351,900 shares change hands.
Before Google initiated its initial public offering, Larry Page & Sergey Brin faced legal action for giving Playboy an interview about themselves and Google. The SEC (Security & Exchange Commission) forbids giving out information pertaining to a company’s specifications before an IPO is launched.
After some initial stumbles, Google’s initial public offering took place on August 19, 2004. 19,605,052 shares were offered at a price of $85 per share. Of that, 14,142,135 (another mathematical reference as √2 = 1.4142135…) were floated by Google and 5,462,917 by selling stockholders. The sale raised $1.67 billion, of which approximately $1.2 billion went to Google. The vast majority of Google’s 271 million shares remained under Google’s control. The IPO gave Google a market capitalization of more than $23 billion. Many of Google’s employees became instant paper millionaires. Yahoo!, a competitor of Google, also benefited from the IPO because it owns 2.7 million shares of Google. The company was listed on the NASDAQ stock exchange under the ticker symbol GOOG.
On August 18, 2005 (one year after the initial IPO), Google announced that it would sell 14,159,265 (a mathematical joke, see pi) more shares of its stock to raise money. The move would double Google’s cash stockpile to $7 billion. Google said it would use the money for “acquisitions of complementary businesses, technologies or other assets”.
The original hardware used by Google included:
- Sun Ultra II with dual 200MHz processors, and 256MB of RAM. This was the main machine for the original Backrub system.
- 2 x 300 MHz Dual Pentium II Servers donated by Intel, they included 512MB of RAM and 9 x 9GB hard drives between the two. It was on these that the main search ran.
- F50 IBM RS6000 donated by IBM, included 4 processors, 512MB of memory and 8 x 9GB hard drives.
- Two additional boxes included 3 x 9GB hard drives and 6 x 4GB hard drives respectively (the original storage for Backrub). These were attached to the Sun Ultra II.
- IBM disk expansion box with another 8 x 9GB hard drives donated by IBM.
- Homemade disk box which contained 10 x 9GB SCSI hard drives
The Google logo has changed over the years.
Google is also known for its innovative holiday logos; see their logo archive. A website has been created that relives these imaginative logos by displaying them randomly on every page-load: Holiday Google.
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