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August 22, 2005

Business News:Google Plans New $4B Stock Offering

From the New York Times:

Where Does Google Plan to Spend $4 Billion?

Published: August 22, 2005

SAN FRANCISCO, Aug. 21 - In all the speculation that followed the announcement from Google on Thursday that it planned to raise an additional $4 billion by selling stock, no one seemed to recall the space elevator.

The elevator - a fanciful alternative to rocket boosters to reach earth orbit - is one of the dozens of business ideas that have been considered by the company's wide-eyed founders, Sergey Brin and Larry Page. It also is one of the ideas that the company's chief executive, Eric E. Schmidt, has taken pride in keeping "below the line."

Of course, such fringe ventures could easily consume any number of billions of dollars that Google might raise on the stock market. It has been Mr. Schmidt's ability to keep the company focused on its stated mission of "organizing the world's information and making it universally accessible and useful" that has so far made the company a powerful threat to larger rivals like Microsoft.

Indeed, that focus is so deeply interwoven in the company's culture that whatever direction Google turns, it is likely to disappoint those expecting a blockbuster acquisition. The 4,100-employee company that the three computer scientists have built has maintained a marked predisposition toward building and not buying its future. Indeed, its acquisitions to date have exclusively been of small technology start-ups led by designers whom Google wanted to hire.

That is a marked contrast to its two main competitors, the Microsoft Corporation and Yahoo, which have recently turned to high-profile acquisitions to enter new markets.

Google's preference has been instead to try to create new markets from scratch or to redefine existing ones when it enters them.

LINK to rest of article

Posted by Becky at August 22, 2005 10:46 AM Posted to Investments/Finance