Google’s Larry Page will try to recapture original energy as CEO
When he was 12, Larry Page read a biography of inventor Nikola Tesla who — eclipsed by rival Thomas Edison — died penniless even though he had figured out how to deliver electricity on a massive scale.
“You don’t want to be Tesla,” Page told Fortune magazine in 2008. “He was one of the greatest inventors, but it’s a sad, sad story. He couldn’t commercialize anything, he could barely fund his own research. You’d want to be more like Edison. If you invent something, that doesn’t necessarily help anybody. You’ve got to actually get it into the world; you’ve got to produce, make money doing it so you can fund it.”
From the early days of Google Inc., Page has been its Edison. The company’s 37-year-old co-founder has controlled his own inventions and his own business, though largely out of public view. Not one major decision gets made at Google without him. Now he has made his most important decision yet: to run his own company.
Page, who was Google’s chief executive when it was a start-up but has never run a public company, is retaking the helm of the Internet giant he founded 13 years ago. He is stepping in for Eric Schmidt, who helped build Google into the Internet’s most powerful company with a market value of more than $200 billion, and along the way turned himself and the company’s founders into some of the world’s wealthiest people. Schmidt, Page and co-founder Sergey Brin are Google’s largest individual shareholders and together own a controlling stake in the company.
It’s a coming-of-age story for Silicon Valley, said its longtime observer Paul Saffo, managing director at investment advisory firm Discern in San Francisco.
“Larry has grown into being CEO,” Saffo said.
The return of the company founder in a surprise management shake-up has — at least for now — electrified Google, which has been perceived in recent months as losing its edge to Facebook Inc. as the hottest technology company and the place that the most talented engineers want to work.
Page, who will take the helm in April, says he wants to return his company to its entrepreneurial roots. “We are really only at the beginning,” he said during a conference call with analysts Thursday. Page was not available for further comment.
That effort will thrust Page into a much more public role.
Unlike his gregarious co-founder Brin or the smooth-talking Silicon veteran Schmidt, Page is a private person who is at his most comfortable helping engineers create products that engage users. He is visibly uneasy when speaking in public or engaging analysts and journalists, often looking down at his hand-held Android device in meetings.
“Larry is not one of those press-the-flesh, slap-the-back, take-the-client-out-to-dinner guys,” said John Battelle, author of “The Search: How Google and Its Rivals Rewrote the Rules of Business and Transformed Our Culture.”
But as CEO, the reclusive Page will be expected to play a much more visible role, particularly at such a transitional moment in the company’s history as it faces questions about its ability to expand beyond its search business into emerging important new areas of the Web.
“When you are CEO, it’s very different. Everyone looks at you differently. You have to be the public person in the company. That is not something you can engineer around,” Battelle said.
Can Page reboot Google and revive innovation there? There is a palpable optimism in some quarters on Google’s Mountain View, Calif., campus, said one Silicon Valley entrepreneur with close ties to engineers there.
“Larry is young and full of energy. He wants to change things. And at this point that will help Google to wake up a little,” said the entrepreneur, who asked not to be identified because he wants to maintain his relationships with the company. “Whether he’s [Yahoo’s] Jerry Yang or [Apple’s] Steve Jobs remains to be seen.”
Apple co-founder Jobs is credited with resuscitating the then-struggling company when he became CEO in 1997, transforming it into technology’s most valuable company. Yahoo founder Yang led the Internet company from 2007 to 2009, but could not revive it, and handed the reins to CEO Carol Bartz.
But Page never left Google and has been involved in every detail of its business over the years, calling the shots on products and serving as a champion for making those products better for users.
On his watch Google has had a number of wins, such as its Android mobile operating system. Android topped Apple’s iPhone in U.S. smart phone subscribers for the first time in November, accounting for 26% of the market, compared with 25% for Apple, according to ComScore. (Both trail BlackBerry maker Research In Motion, which has 33.5%.)
But Google has also made a number of missteps as it has tried to catch up to Facebook. Facebook, the world’s most popular social networking site with half a billion users, surpassed Google as the most visited website in the U.S. in 2010, according to Internet tracker Experian Hitwise. Facebook also serves up the most online display advertising spots in the U.S., according to ComScore.
As Google has grown to more than 24,000 employees, its speed has slowed just as more agile competitors such as Facebook and Twitter Inc. have begun to pounce, threatening its giant share of the online advertising market.
Google has drawn unwanted comparisons to Microsoft Corp., a once-dominant but now largely dormant technology company despite successes with its Xbox video gaming system and Kinect controller. And Google has lost engineers and a string of senior executives, including Sheryl Sandberg, now chief operating officer at Facebook.
Page led the company in its early years but gave up the post in 2001 when he was in his late 20s and the company was still private. He has the traits of an intensely cerebral Silicon Valley alpha entrepreneur — his mind travels at warp speed, making him at times aloof, impatient or dismissive with people who can’t keep up, Battelle said. Battelle predicts the public responsibilities of his new leadership role will force him to soften his edges and his image.
Page and Brin, graduate students in computer science at Stanford, started the business in a Silicon Valley garage in 1998. Page had the top job and sought to keep control of the company but the company’s investors insisted on a more seasoned leader in Schmidt. In an unusual arrangement, the three men ran Google together. Forbes magazine recently estimated that Page and Brin had a net worth of $15 billion apiece, and Schmidt $5.5 billion.
Battelle recalled that as Google went public in 2004, Page withdrew. He admitted to Battelle that he had not adjusted to his newfound fame and wealth.
“I just want to invent things and get them out in the world,” Page told Battelle.
Now Page is aspiring to invent the next chapter in his business career. People inside Google say Page has aspired to be CEO for years.
Wall Street may not be sold on Page’s ability to run the $200-billion Internet giant, particularly if Schmidt does not stay on long as executive chairman. Shares of Google fell 2% to $611.83 Friday, reflecting uneasiness among investors who are used to having the company in the hands of a professional manager.
“Schmidt very effectively spearheaded Google to become one of the largest and most innovative technology companies of our times and we expect Larry Page to be an equally effective CEO of Google,” said Caris & Co. analyst Sandeep Aggarwal.
Analysts are basing their opinions on Page and Google’s track record. In the early days, Page outsmarted more established search engines by focusing on making the Google search experience better than any other. In the years since, he pushed engineers to take risks that led to hot new products such as Gmail and Google Maps.
But he and Brin had grown frustrated as talented engineers with strong entrepreneurial drive left Google to start their own companies or work for fleet-footed competitors such as Facebook, which is run by its 26-year-old founder who also has a strong product vision and technical chops, Mark Zuckerberg.
Now, Page will try to inject some of that old start-up energy and what he has called “healthy disregard for the impossible” into his sprawling company.
Page, who grew up surrounded by computers and stacks of Popular Science from computer scientist parents, has broad ambitions for Google as more of an artificial intelligence company than an Internet search service. He has obsessed with working on things that “move the needle,” such as Google’s recent experiment with self-driving cars, a subject that has fascinated him since he was a doctoral student.
“I think it is often easier to make progress on mega-ambitious dreams,” Page told graduates in a 2009 commencement address at his undergraduate alma mater, the University of Michigan. “ I know that sounds completely nuts. But, since no one else is crazy enough to do it, you have little competition.”
