Google: IPO as Search
The best way to understand Google IPO is to compare it to a Google search.Google's IPO was very much like one of the searches its technology facilitates: brilliant and unique concept requiring a complex execution and strong user commitment. The process itself is messy and producing results which are quite ambiguous and can be interpreted in many different ways. In the end however, results are sufficiently close to user expectations for the operation to be deemed successful.IPOs and searches share a fundamental ambiguity of objectives.What is the good result of the search? One that produces most quickly a clear answer or one that yields most pertinent information? Is search a one-off event or a never-ending quest? Those questions cannot be answered in an unequivocal fashion. Let's now turn to the objectives an IPO. Is an IPO successful if its proceeds to the company are maximised ? Or if its first-day public price jumps considerably? Or if its post-IPO shareholding is wide and diversified? Or if, one year after the IPO, its price is significantly higher? Again, no clearcut and definite response.In case of the search, its relative, dynamic and iterative nature is widely recognised. This appears to be less of a case with the IPO, too often seen a single, isolated and defining event in company's life.I would like to suggest the key idea underlying the approach of Google founders to its IPO is make it like more like a search process. If one accepts this suggestion, many of the apparent missteps and foolish mistakes become intelligible and even logical.