Google Part II: Alphabet

**David Rosenthal** (0:00)
Are you intentionally wearing a black turtleneck for this one?

**Ben Gilbert** (0:03)
No. It is actually going to be one of my carve-outs though.

**David Rosenthal** (0:05)
Yeah. Amazing.

**Ben Gilbert** (0:07)
What? You think I dress up like Steve Jobs for a Google episode?

**David Rosenthal** (0:11)
Well, I thought because of the war between Android and-

**Ben Gilbert** (0:15)
I walk in and there's this smirk on your face. All right, let's do it.
Welcome to the summer 2025 season of Acquired, the podcast about great companies and the stories and playbooks behind them. I'm Ben Gilbert.

**David Rosenthal** (0:45)
I'm David Rosenthal.

**Ben Gilbert** (0:46)
We are your hosts.
In the late 1990s, Google built the best search engine for the rapidly growing Internet. With a breakthrough search algorithm, low-cost servers based on commodity hardware, and the best business model of all time, search ads, they turned that search engine into a cash-gushing business and took it public in 2004 But then, curiously, they started doing some things that weren't related to search. They launched a breakthrough email service in your browser with Gmail. Maps that were far superior to the current state of the art. Docs and spreadsheets with real-time collaboration for the first time. Of course, YouTube, then Android, and their own web browser with Chrome. Astonishingly, today, Google has 15 products with over half a billion users. Seven of those have over two billion users. David, that is over 25 percent of humans use seven of Google's products.

**David Rosenthal** (1:41)
Just unreal. Can't wait to tell all of these stories today.

**Ben Gilbert** (1:44)
Yes. And they've also launched some colossal failures. Google Plus to try to compete with Facebook, Google Wave, Buzz, and about half a dozen messaging apps. I don't know, maybe a dozen messaging apps over the years. Hot air balloons to provide wireless internet. And of course...

**David Rosenthal** (2:01)
Oh, man, I forgot about the hot air balloons.

**Ben Gilbert** (2:03)
Google Glass.

**David Rosenthal** (2:06)
Can't forget about that one, unfortunately.

**Ben Gilbert** (2:08)
So why did they do all this? And as a business, Google was and still is the company that makes the vast majority of their money from ads on search results on the web. So today, we tell the story of Google as the innovation factory of the 2000s, their reorganization into the parent company Alphabet, and how all of these different products cleverly serve different business purposes. And also how it feeds into Google's original core mission, to organize the world's information.
And we'll end this episode's story right at the dawn of the AI era.

**David Rosenthal** (2:42)
Oh, you're giving away the end.

**Ben Gilbert** (2:43)
Oh, spoilers. Sorry. So, is Google a search engine? Is it the platform company of the web era? Or is it an incubator that just happens to have struck gold with search and perhaps AI? Today, we dive in.
Listeners, if you want to know every time an episode drops, or get early hints at what the next episode will be, check out our email list. That's also where we share corrections and updates about previous episodes, and we are adding a new bonus. You get to help us vote on future episode topics. So the first poll is going out soon. Sign up now at acquired.fm slash email. Join the Slack if you want to come talk about this with us and the whole Acquired community, acquired.fm slash Slack. Before we dive in, we want to briefly thank our presenting partner, JP. Morgan Payments.

**David Rosenthal** (3:31)
Yes, just like how we say every company has a story. Every company's story is powered by payments, and JP. Morgan Payments is a part of so many of their journeys from seed to IPO and beyond.

**Ben Gilbert** (3:40)
So with that, this show is not investment advice. David and I may have investments in the companies we discuss, and this show is for informational and entertainment purposes only. David, where are we starting this Alphabet story?

**David Rosenthal** (3:52)
Ooh, I have a very, very fun beginning for you, Ben. I want to start with a quote from Russ Hanneman.

**Ben Gilbert** (4:02)
The fictional character?

**David Rosenthal** (4:03)
Silicon Valley HBO show. Oh yeah, from the TV show.

**Ben Gilbert** (4:08)
Awesome.

**David Rosenthal** (4:09)
And the quote is, If you show revenue, people will ask how much, and it will never be enough. The company that was the 100x'er, the 1000x'er, is suddenly the 2x dog. But if you have no revenue, you can say you're pre-revenue. You're a potential pure play. It's not about how much you earn, it's about what you're worth and who's worth. The most? Companies that lose money. Immortal words of wisdom for the technology world. God, that show is so good. Why do I bring this up? Why do I start here?