How Google Got Funding
Sergey Brin and Larry Page, college peers whom didn’t like each other too much, both found a common interest in the idea of creating a solid way to search and find information on the internet. Knowing there are endless amounts of information available on the internet, many could benefit by such a product and Brin and Page knew there was a dependable niche awaiting such a product. Despite any differences Brin and Page had, they knew their idea was grand and stuck together to create something we all use today, Google!
How would one get started on such a great invention as Google? Brin and Page, decided they weren’t going to spend millions of dollars, that they didn’t have anyhow, on advertising or on high-end equipment, but the funding they would receive would be used to buy motherboards and other components to inexpensively build computers themselves. They wanted to create a fully searchable database before searching backing for funding. Venture capital firms are for the big boys, and Brin and Page needed great amounts of funding to start their project but Brin and Page knew their plan had to be solid before going that route. Page and Brin created a beta version of their finial product and this allowed their search engine to speak for itself.
Brin and Page decided to build an audience of computer users by giving away the Google search engine for free, and decided to sell advertisements and products on their platform. Google Bechtolsheim, a founder of Sun Microsystems seen that Brin and Page were prepared and got from their presentation that this search technology would be used by all and companies that would pay to use it. Bechtolsheim wrote a check made out to “Google Inc” for $100,000. Brin and Page got started!
Eventually, Page and Brin opened their first corporate headquarters located in a friend’s garage in Menlo Park, California, Google’s search engine was booming and doing well during this time and they were still in beta.
The following year, Google moved into a real office in Palo Alto, with eight employees, and by late 1999 was answering 500,000 queries per day. Despite their growth, Google still needed a lot of funding for their expansion, Brin and Page didn’t want to make Google public just yet, Brin and Page decided collectively that Google, the search engine, was too time consuming and that they needed to work on their studies. They went to Bell and offered it to him for $1 million, their proposal was rejected. Vinod Khosla, one of Excite’s venture capitalists, negotiated Brin and Page down to $750,000, the pair declined this offer. That was a stupid move. In 2010, Google was declared a $180 billion company.
Brin and Page later borrowed $25 million venture capital money from Kleiner Perkins Caufield & Byers and Sequoia Capital, In doing so, Sequoia now had control over some of Google’s policy and forced Brin and Page to hire a CEO or else they would take back that borrowed $12.5 million. Brin and Page gave in and hired Eric Schmidt as Google’s first CEO in March 2001 and the company went public three years later.
Google is a great success story. Brin and Page’s preparation, their hard work, and the fact that they never gave up, despite any road blocks, shows us why they are here to stay. In preparing a solid presentation and having the product speak for itself, and through receiving expert advice and backing; Google is a solid company and is here to stay. You may ask, where does one go for such solid advice? Efraim Landa is an expert in business and in financing. Looking for Venture Capital backing or just sound business advice an expert should help map out a plan for you and work by your side walking you through such an exciting time.
Posted on October 25, 2012, in Business financing, tech news, venture capital success story and tagged start up financing, successful businesses, VC success stories. Bookmark the permalink. Leave a comment.