Was just reading this article about Google’s fifth birthday, which contains the following statistics:
According to the article it started up with four employees in a garage, and later received a $1 million boost from “investors, friends and family.”
MY question is this: How does it sustain itself or make a profit? It doesn’t carry banner ads or sponsored search results. It must cost a lot to payroll 1,000 people and keep the hardware up to date so it can handle the traffic, not to mention the continuous development required to keep it at the cutting edge.
These ‘investors’ didn’t just give their money away, they must be getting - or hoping to get - some kind of a return on their investment.
The only possibility that springs to mind is that they also have stakes in the ‘consultancies’ that advise on how to boost your ranking in the search results, but surely that could leave them open to charges of ‘tweaking’ things at source for the benefit of their special clients.
Actually, they do advertise - try searching for something like “printer cartridges”, and you will see “sponsored links” brought up on the right and at the top. Get the details under the “Advertise with us” link on the home page.
They also sell the search engine technology or customized searches for use in other sites. Usually within corporate intranets. They sell a specialized rack mount appliance, too. Look under the “Business Solutions” link.
Fairly recently, Google has created a service allowing you to place their text-based ads on your own web site, so that’s another way they pull in some cash.
FTR, Google does not do this, nor do any other search engines I know of.
Seriously, if you scroll 1/2 way down here, you can see their business model. Their intranet search dealy (aka the Google Search Appliance) is pretty kewl. And it comes in nifty yellow.
Tangential correction: I know they raised not $1m, but $25m back in 1999. I’m not sure if they raised any future rounds. This included bread from Kleiner Perkins and Sequoia Capital, two very heavyweights.
