Ideas on how to become rich - How to become a billionaire, part 4

Ideas on how to become rich - How to become a billionaire, part 4

In the previous post, I explored how Sam Walton made his money and became very rich. In this post, I will be exploring two individuals who have been instrumental in helping make the world digitalised and in the process have made a lot of money and have become incredibly rich.

This article here examines Google, using Wikipedia as well as news reports as sources. First, we shall be looking at Google in general, although I suspect that many people already know how Google makes money and what the company does and such. Secondly, we shall be looking at the founders and their lives, and how they founded the company. In particular, Page and Brin.

However, in this case study on how to become a billionaire, I will not be giving any answers or giving any personal opinions or recommendations on how to become rich or how to become a billionaire - you can read the information below in the case study and figure out for yourself what it was that made these two individuals very rich and how they did, and you should be constantly asking yourself what ideas and what lessons can be take away from them? The theme of course is "how to become rich". Remember to ask yourself such questions as we explore this case study of Google - one of the best and biggest companies on earth currently.

Case study: Larry Page and Sergey Brin and their company, Google
Materials taken from Wikipedia, online sources, as well as newspaper reports, dated before 2008

What is Google? - a basic primer and basic introduction

Google Inc. is an American public corporation, earning revenue from advertising related to its Internet search, e-mail, online mapping, office productivity, social networking, and video sharing services as well as selling advertising-free versions of the same technologies.

Google was co-founded by Larry Page and Sergey Brin while they were students at Stanford University and the company was first incorporated as a privately held company on 4 September 1998. The initial public offering took place on 19 August 2004, raising US$1.67 billion, making it worth US$23 billion. Google has continued its growth through a series of new product developments, acquisitions, and partnerships.

Google began in January 1996, as a research project by Larry Page, who was soon joined by Sergey Brin, two Ph.D. students at Stanford University in California. They hypothesized that a search engine that analyzed the relationships between websites would produce better ranking of results than existing techniques, which ranked results according to the number of times the search term appeared on a page. Their search engine was originally nicknamed "BackRub" because the system checked backlinks to estimate the importance of a site.

Convinced that the pages with the most links to them from other highly relevant web pages must be the most relevant pages associated with the search, Page and Brin tested their thesis as part of their studies, and laid the foundation for their search engine. The domain google.com was registered on 15 September 1997, and the company was incorporated as Google Inc. on 4 September 1998 at a friend's garage in Menlo Park, California. The total initial investment raised for the new company amounted to almost US$1.1 million.

In March 1999, the company moved into offices in Palo Alto, home to several other noted Silicon Valley technology startups. After quickly outgrowing two other sites, the company leased a complex of buildings in Mountain View at 1600 Amphitheatre Parkway from Silicon Graphics (SGI) in 2003. The company has remained at this location ever since, and the complex has since come to be known as the Googleplex. In 2006, Google bought the property from SGI for US$319 million.

The Google search engine attracted a loyal following among the growing number of Internet users, who liked its simple design and useful results. In 2000, Google began selling advertisements associated with search keywords. The ads were text-based to maintain an uncluttered page design and to maximize page loading speed. Keywords were sold based on a combination of price bid and clickthroughs, with bidding starting at US$.05 per click. This model of selling keyword advertising was pioneered by Goto.com (later renamed Overture Services, before being acquired by Yahoo! and rebranded as Yahoo! Search Marketing). Goto.com was an Idealab spin off created by Bill Gross, and was the first company to successfully provide a pay-for-placement search service. Overture Services later sued Google over alleged infringements of Overture's pay-per-click and bidding patents by Google's AdWords service. The case was settled out of court, with Google agreeing to issue shares of common stock to Yahoo! in exchange for a perpetual license. Thus, while many of its dot-com rivals failed in the new Internet marketplace, Google quietly rose in stature while generating revenue.

Google has created services and tools for the general public and business environment alike; including Web applications, advertising networks and solutions for businesses.

What are some of the money earners for this big company? They are:

How to become rich: Advertising

99% of Google's revenue is derived from its advertising programs. For the 2006 fiscal year, the company reported US$10.492 billion in total advertising revenues and only US$112 million in licensing and other revenues. Google is able to precisely track users' interests across affiliated sites using DoubleClick technology and Google Analytics. Google's advertisements carry a lower price tag when their human ad-rating team working around the world believes the ads improve the company's user experience. Google AdWords allows Web advertisers to display advertisements in Google's search results and the Google Content Network, through either a cost-per-click or cost-per-view scheme. Google AdSense website owners can also display adverts on their own site, and earn money every time ads are clicked.

How to become rich: Software

The Google web search engine is the company's most popular service. As of August 2007, Google is the most used search engine on the web with a 53.6% market share, ahead of Yahoo! (19.9%) and Live Search (12.9%). Google indexes billions of Web pages, so that users can search for the information they desire, through the use of keywords and operators, although at any given time it will only return a maximum of 1,000 results for any specific search query. Google has also employed the Web Search technology into other search services, including Image Search, Google News, the price comparison site Google Product Search, the interactive Usenet archive Google Groups, Google Maps, and more.

In 2004, Google launched its own free web-based e-mail service, known as Gmail. Gmail features conversation view, spam-filtering technology, capability to use Google technology to search e-mail. The service generates revenue by displaying advertisements and links from the AdWords service that are tailored to the choice of the user and/or content of the e-mail messages displayed on screen.

In early 2006, the company launched Google Video, which not only allows users to search and view freely available videos but also offers users and media publishers the ability to publish their content, including television shows on CBS, NBA basketball games, and music videos.

Google has also developed several desktop applications, including Google Desktop, Picasa, SketchUp and Google Earth, an interactive mapping program powered by satellite and aerial imagery that covers the vast majority of the planet. Google Earth is generally considered to be remarkably accurate and extremely detailed. Many major cities have such detailed images that one can zoom in close enough to see vehicles and pedestrians clearly. Consequently, there have been some concerns about national security implications; contention is that the software can be used to pinpoint with near-precision accuracy the physical location of critical infrastructure, commercial and residential buildings, bases, government agencies, and so on. However, the satellite images are not necessarily frequently updated, and all of them are available at no charge through other products and even government sources; the software simply makes accessing the information easier. A number of Indian state governments have raised concerns about the security risks posed by geographic details provided by Google Earth's satellite imaging.

Google has promoted their products in various ways. In London, Google Space was set-up in Heathrow Airport, showcasing several products, including Gmail, Google Earth and Picasa. Also, a similar page was launched for American college students, under the name College Life, Powered by Google.

How to become rich: The founders:

Larry Page is the son of the late Dr. Carl Victor Page, a professor of computer science and artificial intelligence at Michigan State University and one of the University of Michigan's first computer science Ph.D graduates, and Gloria Page, a computer programming teacher at Michigan State University. He is also the brother of Carl Victor Page, Jr. a co-founder of eGroups, later sold to Yahoo! for approximately half a billion dollars. Page attended a Montessori school in Lansing, Michigan, and graduated from East Lansing High School. Page holds a Bachelor of Science degree in computer engineering from the University of Michigan with honors and a Masters degree in Computer Science from Stanford University. At University of Michigan, Page was a member of the solar car team and served as the president of the HKN. After enrolling for a Ph.D. program in computer science at Stanford University, Page was in search for a dissertation theme and decided to explore the mathematical properties of the World Wide Web, understanding its link structure as a huge graph. His supervisor Terry Winograd agreed and Page focused on the problem of finding out which web pages link to a given page, considering the number and nature of such backlinks to be valuable information about that page. In his research project, nicknamed "BackRub," he was soon joined by Sergey Brin, a fellow Stanford Ph.D. student and close friend, whom he had first met in the summer of 1995 in a group of potential new students which Brin had volunteered to show around the campus. To convert the backlink data gathered by BackRub's web crawler into a measure of importance for a given web page, Brin and Page developed the PageRank algorithm, and realized that it could be used to build a search engine far superior to existing ones. In August 1996 the initial version of Google was made available, still on the Stanford Web site.In 1998, Brin and Page founded Google, Inc. Page ran Google as co-president with Brin until 2001 when they hired Eric Schmidt to become Chairman and CEO of Google. According to the 2006 edition of Forbes, Page had an estimated net worth of $18.5 Billion, placing him at rank 26 on Forbes's list of the richest persons in the world, together with Brin.

Sergei Brin was born in Moscow, in the Soviet Union to a Jewish family. According to Google lore, Page and Brin "were not terribly fond of each other when they first met as Stanford University graduate students in computer science in 1995." They soon found a common interest: retrieving relevant information from large data sets. Together, the pair authored what is widely considered their seminal contribution, a paper entitled "The Anatomy of a Large-Scale Hypertextual Web Search Engine." The paper has since gone on to become the tenth-most accessed scientific paper at Stanford University. Brin has appeared on television shows and many documentaries, including Charlie Rose, CNBC, and CNN. In 2004, he and Larry Page were named "Persons of the Week" by ABC World News Tonight. In January 2005 Sergey Brin was nominated to be one of the World Economic Forum's "Young Global Leaders." In 2007, Brin was cited by PC World as #1 on a list of the "50 most important people on the Web," along with Larry Page and Google CEO Eric Schmidt. He is also an investor in Tesla Motors, which is developing the Tesla Roadster, a 250-mile range battery electric vehicle.


You've been reading ideas on how to become rich from Google, and the founders Page and Brin. What ideas have you learnt on how to become rich and how to become a billionaire? These are the central questions that you may wish to ask yourself and remind yourself of.

More to come in future posts here on my ideas blog, where I explore various ideas on how to become rich, and in this series, how to become a billionaire in particular. Thanks for reading and cheers!

Ideas on how to become rich!