THE GAME | By Dennis Berman
Here's a simple exercise: Write down your purpose in this world
and what you'd like your life to look like in 10 years. Check back
in a decade and see what happened.
Google did just that in the spring of 2004, when it composed the
stock prospectus used to bring it to the public markets.
To mark the Aug. 19 anniversary of its IPO, I sifted through
that 79,743-word prospectus, looking for clues to what has made
Google the company it is today. If this is a founding document--a
Magna Carta or a U.S. Constitution--does its sense of purpose
endure?
It's most tempting to assess only the infamous "don't be evil"
commitment, dropped into a founder's letter by Larry Page and
Sergey Brin. But there is much more in this document. It conveys
clarity of purpose that many companies only grope toward. Plainly
and with examples, it manages to infuse a great capitalistic
undertaking with a higher calling. Somehow, it also avoids being
treacly.
Like an opening gong, the letter's first sentence declares
Google "is not a conventional company." It goes on to define the
company's mission simply: "delivering relevant information on any
topic."
Inspired by Warren Buffett, the letter is forthright about red
flags for investors, namely a dual-class share structure that keeps
founders in control. "A management team distracted by a series of
short-term targets is as pointless as a dieter stepping on a scale
every half hour," declares Mr. Page, who handled most of the
writing duties. Most of his sentences are short. None are longer
than 33 words.
Looking back 10 years, you can see how those words helped form a
culture--one that is fearless, experimental and flexible enough to
make Google what it is today. Consider this extended passage from
the letter, keeping in mind all that would happen later:
It's fascinating to think about how small Google's world was
back then, a company of fewer than 2,000 employees. And it was
almost exclusively a search engine, for whom the meager combatants
Yahoo and Microsoft were the only named competition.
In 2004, its products were so limited that it listed now-mundane
features such as spell-check and online calculators as important
user benefits. Its email service, Gmail, had just launched.
Smartphones were so undeveloped that the word mobile appeared only
six times, and even then, "the mobile web" required quotation marks
to show how exotic it was. There was no Android, no YouTube, no
Google Car or Google Chrome, no thermostats, orbiting satellites or
fiber-optic rollouts.
In fact, 2004 revenue was just under $3.2 billion, less than the
Washington Post Co. and Western Union Co. had at the time.
Today, Google's performance speaks for itself. Revenue tops $65
billion, more than all but 40 U.S. companies; net profit margins
exceed 20%, higher than all but three; and its market
capitalization has become one of the largest?? on earth, nearly
$400 billion.
This success might seem inevitable because of the ascendance of
the Web. But if that were fully the case, Yahoo and Microsoft would
have risen in tandem. They didn't.
None of its forward-thinking of 2004 is to say Google is
perfectly positioned for the challenges of 2024. Much threatens its
realm.
The decade-old objective to deliver "unbiased access" to
information is threatened by the smartphone's small screen. The
company has been tangled in legal messes around the globe and its
own bureaucracy back at headquarters. Google can be arrogant and
pushy, imposing its priorities on the world. Deeper questions of
surveillance, privacy and liberty await.
Ten years on, though, Google remains undeniable, plugged into
our central nervous system. As you ask why, go back and read that
concise and enduring opening letter. Then try the exercise
yourself: How would you, in short sentences, convey your purpose 10
years into the future? If you can't do that, it probably won't
happen.
Write to dennis.berman@wsj.com; follow him on Twitter
@dkberman
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