Eleven years prior, the founders of Google, Sergey and I, declared in our foundational letter, “Google is not a conventional company. We do not intend to become one.” This principle has been the cornerstone of our journey, pushing us beyond the norms and into realms of innovation that have reshaped the tech landscape.
From the outset, we committed to exploring “smaller bets in areas that might seem very speculative or even strange when compared to our current businesses.” This unconventional approach has been pivotal in birthing products that now boast over a billion users globally, including Google Maps, YouTube, Chrome, and Android. Our appetite for groundbreaking initiatives remains undiminished, as we continue to venture into projects that others might deem audacious.
We have long observed a trend where established companies often become complacent, resorting to incremental improvements over radical innovation. However, the technology sector thrives on revolutionary ideas that fuel the next wave of growth. To remain at the forefront, a degree of discomfort and a willingness to challenge the status quo are essential.
While Google operates robustly today, we recognized an opportunity to refine our structure for enhanced clarity and accountability. This realization has led to the creation of Alphabet, a new parent company. I am thrilled to assume the role of CEO of Alphabet, supported by Sergey as President, in this exciting new chapter.
Deciphering Alphabet: A Collection of Companies
Alphabet is structured as a conglomerate of companies, with Google at its heart. This revamped Google is leaner, focusing primarily on our core internet products. Operations that are “far afield,” particularly our health-focused ventures like Life Sciences (known for the glucose-sensing contact lens) and Calico (dedicated to longevity), will now operate independently under the Alphabet umbrella. This strategic segregation allows for greater managerial focus and scalability, enabling independent operation for businesses with distinct focuses.
The essence of Alphabet lies in fostering business growth through empowered leadership and autonomy. Our operational model is centered around strong CEOs leading each business, with Sergey and myself providing support and strategic direction as needed. We are committed to rigorous capital allocation and ensuring operational excellence across all ventures. A crucial aspect of this structure is appointing exceptional CEOs for each entity and defining their compensation. Furthermore, with the introduction of Alphabet, we will implement segment reporting starting from our Q4 results, providing separate financial disclosures for Google and the broader Alphabet businesses.
This restructuring is designed to intensify our focus on the extraordinary opportunities within Google. A key figure in this renewed focus is Sundar Pichai. Sundar’s strategic insights and vision have consistently mirrored, and often surpassed, my own. Our collaborative journey has been exceptionally rewarding. His leadership has been increasingly evident since he took on product and engineering responsibilities for our internet businesses last October. Both Sergey and I, along with the board, recognize that Sundar is the ideal leader to take the helm as CEO of Google. My transition to Alphabet CEO allows me to dedicate more time to scaling our broader ambitions, while continuing to support Sundar and Google in every possible way. Google’s innovation pipeline remains vibrant, and I am confident in Sundar’s commitment to pushing boundaries and advancing our core mission of organizing the world’s information. Recent innovations like Google Photos and Google Now, leveraging machine learning, exemplify this progress. Moreover, services like YouTube, under Susan’s strong leadership as CEO, continue to thrive as independent entities, driving substantial growth.
Sergey and I are deeply passionate about initiating new ventures. Alphabet will also encompass our X lab, the incubator for ambitious projects like Wing, our drone delivery initiative. We are also enthusiastic about expanding our investment arms, Ventures and Capital, within this new framework.
Alphabet on Nasdaq: GOOGL and GOOG Ticker Symbols
Alphabet Inc. will succeed Google Inc. as the publicly-traded entity. All shares of Google will automatically convert into an equivalent number of Alphabet shares, maintaining all existing rights. Google will become a wholly-owned subsidiary of Alphabet. Our dual class share structure will persist, trading on Nasdaq under the tickers GOOGL and GOOG. For investors tracking Nasdaq Googl Compare and Nasdaq GOOG compare, this transition signifies a structural change without altering the fundamental equity ownership.
For Sergey and myself, the inception of Alphabet marks an exhilarating phase in Google’s evolution. The name ‘Alphabet’ resonates with us as it symbolizes the collection of letters forming language, a cornerstone of human innovation and the very foundation of Google’s search indexing. Additionally, it alludes to ‘alpha-bet,’ representing investment returns exceeding benchmarks, a goal we continually pursue. It is important to note that Alphabet is not conceived as a consumer brand; its essence lies in empowering independent brands to flourish autonomously.
We are energized by the prospects of:
- Undertaking more ambitious and transformative projects.
- Adopting a long-term strategic perspective.
- Empowering exceptional entrepreneurs and companies to thrive.
- Investing at a scale commensurate with the opportunities and resources we foresee.
- Enhancing transparency and oversight across our operations.
- Elevating Google’s performance through sharpened focus.
- Ultimately, enhancing the lives of as many individuals as possible.
This is a pivotal moment, and we are eager to embark on this journey with the entire Alphabet family. And yes, we too are still getting accustomed to the new name!
