Two decades ago, Morgan Stanley banker Michael Grimes was helping lead the young company’s public offering. Google One of the most anticipated search engines of the decade, it was one of the first to offer a new email service. He can choose any identifier he wants, so he asks for michael@gmail.com.
Google co-founder Sergey Brin chimed in. You will always be plagued by spam.
Grimes told me that he does regret giving up his email address. But the IPO helped solidify his reputation as Wall Street’s Silicon Valley whisperer just as the technology industry began to reshape global investment.
He called Google’s IPO, which has seen its stock price rise 7,600% over the past two decades, “significant.”
The companies Grimes has listed have a cumulative market value in the trillions of dollars. Some are more noisy, e.g. Facebook2012 IPOs, some of which pioneered innovative new structures, e.g. SpotifyDirect listing in 2018.
“This is the beginning of the next era,” Grimes said. “Google (and the other big companies that followed) changed the way we work, live, and play. They did it in a bigger way than we could have ever imagined, and these companies are now multi-trillion dollar companies. .
Twenty years after its 2004 IPO, Google currently operates under parent company Alphabet and has a market capitalization of more than $2 trillion. The tech giant is no longer just about search and advertising, but also YouTube, Pixel smartphones, cloud computing, self-driving cars and generative technology AI among its many business units. This is a tech company so big that the Department of Justice may be looking for Separate it.
Alphabet could not immediately be reached for comment.
Twenty years ago, the tech industry was still reeling from the dot-com bubble of the early 2000s, and investors were wary, especially when Google decided to use an unconventional IPO process called a “Dutch auction.” By allowing a wider range of investors to participate.
The founder’s IPO letter began: “Google is not a traditional company. We do not intend to become a traditional company.” It also introduced Google’s “Don’t be evil” philosophy.
Grimes said Brin and Larry Page wanted to provide a level playing field for their IPO: “Their view was: Wait, what if a young engineer sells some vested stock from Cisco or somewhere else? , and she wanted to put $10,000 into Google, why would she do that and was told she would only get $500 or nothing?
“Auction allocation,” Grimes said, “will be determined by price and size. Rather than being determined by who you are, that’s interesting. That’s a fundamental breakthrough.”
Grimes added that some banks and institutions warned Google’s co-founders against the unusual process and told them it wasn’t the way things were done, but others, like his own team, said they would work with them Build together.
Winning the coveted “left lead” in an IPO was, and still is, a highly competitive race. His team embraced the format, built a prototype and tested a billion bids.
To conduct the road show, they split into three different teams. Co-founders Brin and Page each lead their own teams, and CEO Eric Schmidt leads a third team.
By most accounts, the IPO was a success. Google overcame a weak IPO market and an unproven offering model to achieve solid first-day returns and a market capitalization of more than $27 billion. From there, stocks Keep admiring.
But the principles behind Google’s IPO took more than a decade to materialize. Consumer technology brands such as Facebook (now Meta), Twitter (now X) and LinkedIn will take the traditional IPO route. But several high-profile listings between 2019 and 2021 did contain elements consistent with Google’s democratizing intentions. Airbnb Offers hosts the opportunity to purchase shares at the IPO price. Uber and Lyft By offering shares to drivers, Robinhood offered customers access to an initial public offering.
Assessing the impact of Google’s “Don’t be evil” philosophy and its evolution is much more complex. Grimes declined to comment to Google Today, saying he couldn’t comment on customers.
Today, Google is accused by U.S. and European regulators of stifling innovation, and while the company is at the forefront of a transformation into generative artificial intelligence platforms, search and advertising — which remain the backbone of its survival — are facing their biggest crisis in decades. existential threat.
