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Summary:

Going for a Dutch auction made Google’s 2004 IPO more complex and Playboy almost killed it. Writing for the Harvard Business Review, *Google…

Eric Schmidt
photo: AP Images

Going for a Dutch auction made Google’s 2004 IPO more complex and Playboy almost killed it. Writing for the Harvard Business Review, *Google* CEO Eric Schmidt provides a case study in going public in a “Googley” way and making oodles of money despite — or because of — negative press. His thesis: Google (NSDQ: GOOG) survived with its own values intact by avoiding the traditional IPO route. A few bits from the article (but not a substitute for reading it all):

More attention, more money: Schmidt credits the intense attention on how bad an IPO would be for Google with increasing public awareness, which in turn increased traffic and revenue. He tosses in doom-and-gloom quote after quote from media and analysts about Google’s decisions and his chances. During the quiet period “people came out in droves to criticize our business, our management, our culture, our IPO — almost every aspect of who we were. And because we had to remain silent, we weren

  1. It’s interesting to hear an inside view on the IPO that got so much attention, but I wish he was a bit more accurate on the track record of IPO auctions. Schmidt said something along the lines of theirs being the biggest auction IPO ever, but Google knew at the time of their IPO that this wasn’t true – there’ had already been at least a dozen IPO auctions that raised a billion dollars or more. Dozens of countries have used auctions for IPOs, with the US beginning relatively late. The Singapore Telecom IPO auction in 1993 was substantially larger than Google’s IPO, even before adjusting for a decade’s worth of inflation.

    What Schmidt apparently means is that Google’s IPO was bigger than other US IPO auctions – sometimes its hard for Americans to remember that we don’t invent everything.

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