History of Google

Based on Wikipedia: History of Google

The $750,000 Company

In early 1999, two Stanford graduate students walked into the office of George Bell, the CEO of Excite, one of the hottest search engines of the era. They had something to sell: a search engine they'd built called Google. Their asking price was one million dollars.

Bell said no.

One of Excite's venture capitalists, Vinod Khosla, managed to talk the students down to $750,000. Bell still said no. Today, Google's parent company Alphabet is worth well over a trillion dollars. That rejected offer might be the most expensive "no" in business history.

But this story doesn't start with a sales pitch. It starts with a homework assignment, a misspelled word, and a borrowed garage.

BackRub and the Problem of Importance

In 1995, a doctoral student named Larry Page was hunting for a thesis topic. His supervisor, Terry Winograd, had a suggestion: why not explore the mathematical structure of the World Wide Web? The web was still young—a chaotic, sprawling mess of interconnected pages—and Page became fascinated by a particular question. When one webpage links to another, what does that link actually mean?

Page realized something profound. In academic publishing, citations work as votes of confidence. When a paper cites another paper, it's essentially saying: this work matters. What if links on the web worked the same way?

He shared this idea with a fellow student named Sergey Brin, whom he'd met during a campus tour the previous summer. Brin had been the tour guide. The two hadn't exactly hit it off at first—both were opinionated and argumentative. But they found common ground in this problem of measuring importance on the web.

They called their research project "BackRub," because it analyzed backlinks—the links pointing toward a given page rather than away from it. The name sounds almost quaint now, like something you'd find in a strip mall between a nail salon and a tax preparer.

Page enlisted a talented programmer named Scott Hassan to start writing the code. Hassan would later be described as an unofficial "third founder," though he left before the company was formally incorporated. In March 1996, Page's web crawler began its work, starting from a single page: Larry Page's own Stanford homepage. It spread outward from there, following links, cataloging connections, mapping the web's hidden architecture.

The Algorithm That Changed Everything

From this backlink data, Page and Brin developed what they called PageRank—a bit of wordplay on Larry's surname and the concept of ranking pages. The algorithm was elegant in its logic: a page was important if other important pages linked to it. This created a recursive definition that required some serious mathematics to untangle, but the result was revelatory.

Existing search engines at the time ranked results by simple keyword matching. If you searched for "Stanford University," they'd show you pages where those words appeared most frequently. This was easily manipulated and often produced garbage results. PageRank looked at something deeper: the web's collective judgment about what mattered.

The first version of Google launched on Stanford's website in August 1996. It immediately started consuming nearly half of the university's entire network bandwidth. The system was hungry, and it was growing.

Where did the name come from? "Google" is actually a misspelling of "googol"—the mathematical term for the number one followed by one hundred zeros. The founders picked it to suggest the vast quantities of information their engine could handle. That typo stuck, and a new word entered the language.

From a Garage to a Googleplex

On September 15, 1997, Page and Brin registered the domain google.com. Almost exactly a year later, on September 4, 1998, they formally incorporated their company in the garage of their friend Susan Wojcicki in Menlo Park, California. Wojcicki would later become an executive at Google and eventually the CEO of YouTube—a company Google would acquire in 2006.

The garage founding is now a Silicon Valley cliché, but it was simply practical at the time. Two graduate students don't have money for office space.

By the end of 1998, Google had indexed about sixty million web pages. The homepage was still marked "BETA," but technology writers were already taking notice. A Salon.com article argued that Google's results were better than competitors like Hotbot or Excite, praising its technical innovation compared to the cluttered portal sites that dominated the era.

Those portal sites—Yahoo, Lycos, Netscape's Netcenter, AOL—were busy stuffing their homepages with news, weather, stock tickers, and shopping links. They were trying to be everything to everyone. Google took the opposite approach: a nearly blank page with a search box and two buttons. In an era of visual chaos, that simplicity was revolutionary.

The company moved fast. In March 1999, they relocated to an office on University Avenue in Palo Alto. They outgrew that, then another site, and in 2003 leased a complex of buildings in Mountain View from Silicon Graphics. The address—1600 Amphitheatre Parkway—would become famous. They called it the Googleplex, playing on "googolplex" (a one followed by a googol zeros). In 2006, they bought the property outright for $319 million.

The Ad Revolution They Almost Rejected

Here's an irony worth savoring: while still Stanford students, Brin and Page wrote a research paper arguing against advertising-funded search engines. They worried that ads would corrupt search results, that commercial interests would inevitably compromise the purity of information retrieval.

They changed their minds.

In 2000, Google began selling text advertisements linked to search keywords. But they did it carefully. The ads were text-only, designed to load fast and not clutter the page. They looked almost like search results themselves—a design choice that would later attract controversy but initially seemed elegant.

The pricing model was clever: advertisers bid on keywords, and their costs depended on both their bid and how often users actually clicked their ads. This "pay-per-click" approach wasn't Google's invention—a company called Goto.com had pioneered it. When Goto changed its name to Overture Services, it sued Google for patent infringement. Yahoo later bought Overture, and the case was settled out of court, with Google issuing shares to Yahoo in exchange for a license.

While countless dot-com companies crashed and burned in the early 2000s, Google quietly accumulated users and revenue. The company had found something sustainable: people searching for things, and businesses willing to pay to be found.

"Don't Be Evil" and the IPO

When Google filed for its initial public offering in 2004, the company included an unusual phrase in its prospectus: "Don't be evil." This became their unofficial motto, a declaration that Google would be different from typical corporations. "We believe strongly that in the long term, we will be better served—as shareholders and in all other ways—by a company that does good things for the world even if we forgo some short-term gains," the prospectus read.

The IPO happened on August 19, 2004. The company went public with an unconventional approach—a Dutch auction that let ordinary investors bid on shares rather than letting investment banks control distribution. Wall Street was skeptical. The initial offering was more modest than expected.

Then the stock quadrupled.

By June 2005, Google was valued at nearly $52 billion, making it one of the world's biggest media companies by market capitalization. A year after the IPO, Google announced it would sell an additional 14,159,265 shares—and that number wasn't random. It's the first eight digits after the decimal point in pi. The founders couldn't resist embedding a mathematical joke into their financial filings.

The Product Explosion

Between 2002 and 2011, Google launched an astonishing array of products. Google News arrived in 2002, aggregating headlines from thousands of sources. Gmail came in 2004, offering a then-unheard-of gigabyte of storage when competitors measured email space in megabytes. Google Maps launched in 2005, eventually absorbing Keyhole to create Google Earth. Chrome, their web browser, debuted in 2008.

In 2003, they acquired Pyra Labs, the company behind Blogger, giving Google a foothold in the nascent blogosphere. The information flowing through blogs would help improve search results and feed Google News.

Not everything worked. In 2008, Google launched Knol, an attempt to compete with Wikipedia. It failed within four years. The company made four attempts at social networking—Orkut in 2004, Google Friend Connect in 2008, Google Buzz in 2010, and Google+ in 2011. All of them eventually shut down, with Google+ finally closing in April 2019. Some companies just aren't meant for social.

The Privacy Pivot

There's a story about Google that gets told less often than the garage founding or the rejected acquisition offer. It's about tracking.

For years after its IPO, Google didn't use HTTP cookies—small files stored in your browser—to track your web browsing. Then in 2007, they bought DoubleClick for $3.1 billion. DoubleClick was an advertising technology company, and its core business was exactly this kind of cookie-based tracking. The acquisition marked a turning point.

Even after buying DoubleClick, Google initially kept its advertising data separate from information collected by its other services. If you used Gmail and Google Search, your activity in those products wasn't merged with data about which ads you'd seen across the web.

That separation ended in 2016. Google changed its privacy policy to allow the merging of this data, making its tracking personally identifiable. The company that had once worried about advertising corrupting search was now running one of the most sophisticated personal data collection operations in history.

The Microsoft Wars

As Google grew, it found itself in an escalating rivalry with Microsoft. The conflict was almost inevitable—both companies wanted to be the primary gateway to the internet.

Microsoft developed Bing to compete with Google Search. Both companies offered webmail (Gmail versus Hotmail, later Outlook). Both offered online office tools. Google even developed its own operating system, ChromeOS, running on laptops called Chromebooks, directly competing with Windows.

The rivalry turned personal in 2005 when Kai-Fu Lee, a vice-president at Microsoft, left to join Google. Microsoft sued, citing Lee's non-compete contract and his access to sensitive information about Microsoft's plans in China. The companies settled out of court in December 2005, with confidential terms.

Around the same time, rumors circulated about a Google web browser—fueled by the discovery that Google owned the domain "gbrowser.com." Those rumors proved accurate when Chrome launched in 2008. It would eventually become the world's dominant browser, a position Internet Explorer had once held.

The Click Fraud Problem

Google's advertising model contained a vulnerability. If advertisers paid per click, what happened when the clicks were fake? Competitors could drain each other's advertising budgets. Website owners displaying Google ads could click their own ads to inflate their revenue. Automated scripts could generate millions of fraudulent clicks.

In December 2004, Google's Chief Financial Officer, George Reyes, acknowledged the problem at an investor conference: "Something has to be done about this really, really quickly, because I think, potentially, it threatens our business model." The company has spent years developing increasingly sophisticated systems to detect and filter fake clicks, but the problem has never fully disappeared.

Experiments Beyond Search

Google's ambitions weren't limited to the screen. In January 2006, they bought dMarc, a company that automated radio advertising. They experimented with print advertising, placing ads in the Chicago Sun-Times. The company's CEO, Eric Schmidt, explained their philosophy during a 2005 conference call: "We don't do the same thing as everyone else does... We try to see new problems and new markets using the technology that others use and we build."

On March 31, 2006, Google was added to the S&P 500, the index of America's five hundred largest public companies. They replaced Burlington Resources, an oil company that had been acquired by ConocoPhillips. The day after the announcement, Google's stock rose seven percent.

Restructuring: From Google to Alphabet

By 2015, Google had become unwieldy. The company was involved in self-driving cars, life sciences, venture capital, drone delivery, and dozens of other projects that had little to do with search or advertising. The solution was structural: create a new holding company called Alphabet Inc., with Google as its largest subsidiary.

Under this arrangement, Google continued handling the core internet businesses—search, advertising, YouTube, Android, Chrome, and cloud services. Other ventures became separate companies under the Alphabet umbrella: Waymo for self-driving cars, Verily for life sciences, Wing for drone delivery.

In September 2017, Google Inc. became Google LLC, restructuring as a limited liability company wholly owned by Alphabet. The shift was largely technical, but it marked the end of Google as an independent corporate entity. The garage startup had become a division of a conglomerate.

The Verb That Ate the Dictionary

Perhaps nothing better illustrates Google's cultural impact than this: "google" became a verb. First it appeared in slang, then in dictionaries. When you "google" something, everyone knows what you mean—you're searching for information online, regardless of which search engine you actually use.

Linguists call this "genericization"—when a brand name becomes a common word. It happened to aspirin, escalator, and thermos. It's usually a mixed blessing for companies. On one hand, it represents total cultural dominance. On the other, it can threaten trademark protection.

Google made efforts to discourage the generic use of its name, but language doesn't take orders from corporate legal departments. The verb stuck.

The Legacy of BackRub

Looking back, the Google story contains multitudes. There's the inspiring narrative: two graduate students with a better idea, building something world-changing in a garage. There's the cautionary tale: a company that once warned against advertising-funded search becoming the largest advertising company in history. There's the innovation story: PageRank, Gmail, Maps, Chrome, Android. And there's the power story: a company that knows what you search for, what you email, where you go, and what you buy.

The PageRank algorithm that started it all drew inspiration from an earlier system called RankDex, developed by Robin Li in 1996. Li's patent is cited in Page's PageRank patent filing. Li went on to create Baidu, which became China's dominant search engine. In a sense, the same core insight—that links could measure importance—birthed the leading search engines of both East and West.

As of 2014, Google operated over seventy offices in more than forty-one countries. The two doctoral students who met on a campus tour now oversee one of the most influential technology companies ever created.

And somewhere, perhaps, George Bell of Excite still thinks about that meeting in 1999, when he turned down a million-dollar offer. Then $750,000. For a search engine that now processes over 8.5 billion searches every day.

Some nos echo longer than others.