History of Google(2)
Financing, 1998 and initial public offering, 2004
The first funding for Google was an August 1998 contribution of $100,000 from Andy Bechtolsheim, co-founder of Sun Microsystems, given before Google was incorporated. Early in 1999, while graduate students, Brin and Page decided that the search engine they had developed was taking up too much time and distracting their academic pursuits. They went to Excite CEO George Bell and offered to sell it to him for $1 million. He rejected the offer and later criticized Vinod Khosla, one of Excite's venture capitalists, after he negotiated Brin and Page down to $750,000. On June 7, 1999, a $25 million round of funding was announced, with major investors including the venture capital firms Kleiner Perkins Caufield & Byers and Sequoia Capital.
Google's initial public offering (IPO) took place five years later on August 19, 2004. At that time Larry Page, Sergey Brin, and Eric Schmidt agreed to work together at Google for 20 years, until the year 2024. The company offered 19,605,052 shares at a price of $85 per share. Shares were sold in an online auction format using a system built by Morgan Stanley and Credit Suisse, underwriters for the deal. The sale of $1.67bn gave Google a market capitalization of more than $23bn. By January 2014, its market capitalization had grown to $397bn. The vast majority of the 271 million shares remained under the control of Google, and many Google employees became instant paper millionaires. Yahoo!, a competitor of Google, also benefited because it owned 8.4 million shares of Google before the IPO took place.
There were concerns that Google's IPO would lead to changes in company culture. Reasons ranged from shareholder pressure for employee benefit reductions to the fact that many company executives would become instant paper millionaires. As a reply to this concern, co-founders Sergey Brin and Larry Page promised in a report to potential investors that the IPO would not change the company's culture. In 2005, articles in The New York Times and other sources began suggesting that Google had lost its anti-corporate, no evil philosophy. In an effort to maintain the company's unique culture, Google designated a Chief Culture Officer, who also serves as the Director of Human Resources. The purpose of the Chief Culture Officer is to develop and maintain the culture and work on ways to keep true to the core values that the company was founded on: a flat organization with a collaborative environment. Google has also faced allegations of sexism and ageism from former employees.
The stock performed well after the IPO, with shares hitting $700 for the first time on October 31, 2007, primarily because of strong sales and earnings in the online advertising market. The surge in stock price was fueled mainly by individual investors, as opposed to large institutional investors and mutual funds. The company is listed on the NASDAQ stock exchange under the ticker symbol GOOG and on the Frankfurt Stock Exchange under the ticker symbol GGQ1.