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Acquired / Case file

Google

History

Inflection points

Google was founded in 1998 (Menlo Park, California (Susan Wojcicki's garage)). Every turn Acquired identified: founding, leadership changes, strategic pivots, crises, cultural moments.

13 events4 decades covered1998 founded

Events and financial outcomes

Buys the London AI lab the hosts call 'the YouTube of AI' — the acquisition they argue led, downstream, to OpenAI, ChatGPT, Anthropic, and Gemini.

Event source: Acquired Google Part III

Reported financial changes between FY2013 · 2013-12-31 and FY2015 · 2015-12-31
MeasureFY2013 · 2013-12-31FY2015 · 2015-12-31Change
Revenue$55.5B$75.0B$19.5B
Operating margin27.7%25.8%-1.9 pp
Net income$12.7B$16.3B$3.6B
Operating cash flow$18.7B$26.6B$7.9B
Capital expenditures$7.4B$9.9B$2.6B

Reporting periods outside the event year; changes also reflect other decisions, market conditions, and accounting.

Case question. Which revenue, cost, or capital decision could explain the outcome, and what evidence would separate its effect from changes in the market?

The story

Larry Page and Sergey Brin met as Stanford PhD students; their BackRub research scored pages by who links to them, which became PageRank and then Google. The company nearly stayed a licensing project until Andy Bechtolsheim wrote a $100,000 check to 'Google Inc.' before the entity legally existed. The organic-search breakthrough had no business model for years; Google found it by adapting the pay-per-click search auction GoTo / Overture had pioneered, then compounding it on a data-and-marketplace flywheel.

Inflection points · grouped by decade

1990s

  • 1996Founding

    BackRub / PageRank research at Stanford

    Page and Brin's research project ranks web pages by their inbound link structure, the insight that becomes PageRank and then Google.

    [Acquired Google Part I]

  • 1998Founding

    Google Inc. incorporated

    Bechtolsheim's $100,000 check to a company that did not yet exist forces incorporation. First office: Susan Wojcicki's Menlo Park garage.

    [Acquired Google Part I]

2000s

  • 2000Product

    AdWords launches (350-advertiser beta)

    Google's first ad product, October 2000. Still partly negotiated and hand-entered; the self-serve auction comes later.

    [Acquired Google Part I]

  • 2002Strategic shift

    AdWords v2 — the self-serve CPC auction

    Google adopts the pay-per-click, highest-bidder-wins, self-serve auction GoTo / Overture pioneered, and pairs it with relevance. The monetization engine is set.

    [Acquired Google Part I]

    • Ben:Insight number one, paid ads on keywords auctioned off to the highest bidder showing up first. Insight number two... this whole cost per thousand impressions thing was wrong, that eventually he thought the whole world was going to move beyond this to a cost per click or pay per click pricing.
      [Acquired Google Part I, ch. GoTo / Overture insight]
      Episode
  • 2004-08IPO

    IPO via Dutch auction; dual-class structure

    Google goes public in a Dutch-auction IPO and adopts a dual-class share structure borrowed from media families. The dual class became the tech-IPO default; the Dutch auction did not.

    [Acquired Google Part I]

    • David:Dual class share structure, great idea. Everybody does it. Dutch auction IPO, not a great idea. Nobody has done it since.
      [Acquired Google Part I, ch. The 2004 IPO]
      Episode
  • 2005-07Acquired co.

    Acquires Android for $50M

    Larry Page buys Andy Rubin's struggling OS startup eighteen months before the iPhone reveal, then runs Google's distribution playbook on it.

    [Acquired Google Part II]

  • 2006Acquired co.

    Acquires YouTube ($1.65B)

    Buys the video platform that becomes a second advertising and attention engine alongside search.

    [Acquired Google Part II]

  • 2008Product

    Chrome launches

    A free browser that ends Microsoft's Internet Explorer grip on the web and keeps Google search the default entry point.

    [Acquired Google Part II]

    • David:To say it worked is like the understatement of the century. It totally liberates Google from Internet Explorer and Microsoft.
      [Acquired Google Part II, ch. Chrome]
      Episode

2010s

  • 2014-01Acquired co.

    Acquires DeepMind (~$650M)

    Buys the London AI lab the hosts call 'the YouTube of AI' — the acquisition they argue led, downstream, to OpenAI, ChatGPT, Anthropic, and Gemini.

    [Acquired Google Part III]

  • 2015Strategic shift

    Alphabet restructure

    Google reorganizes under the Alphabet holding company, separating the core search-ads business from the loss-making 'other bets.'

    [Acquired Google Part II]

  • 2017Strategic shift

    'Attention Is All You Need' — the Transformer

    Google researchers publish the Transformer architecture that underpins every modern large language model, including the ones built by rivals.

    [Acquired Google Part III + Vaswani et al. (2017)]

2020s

  • 2023Product

    Gemini and the AI-first stack

    Google merges Brain and DeepMind and ships Gemini, run on its own cloud and its own TPUs — model, chip, and distribution owned end to end.

    [Acquired Google Part III]

  • 2025Acquired covered

    Acquired's three-part Google series

    Ben and David trace the arc from PageRank to the search-ad auction to the AI stack across Origins of Search, Alphabet, and The AI Company.

    [https://www.acquired.fm/episodes/google-the-ai-company]