A glimpse into the world of Google; an insider’s view of the company’s multi-billion dollar search to stay ahead. Larry Page personally signs off every new recruit in a firm which now has 39,000 staff.

A glimpse into the world of Google

As the first UK newspaper allowed to attend a “Nooglers” session for new Google employees at its California HQ, The Sunday Telegraph gets an insider’s view of the company’s multi-billion dollar search to stay ahead.

Google’s co-founder Larry Page personally signs off every new recruit in a firm which now has 39,000 staff.

By Katherine Rushton

8:30PM BST 29 Jun 2013

It is Monday morning, and 150 “Nooglers” are gathered in a large room on Google’s campus in Mountain View, California.

Jennifer, a woman in her early thirties wearing a pair of the hi-tech “Google Glass” spectacles, bounces around the stage welcoming the new starters. She is a compelling mix of preppy Californian girl and science fiction-obsessed geek that is de rigueur in Silicon Valley. “I’m a little bit nerd. I love Star Trek. But I also love reading,” she says. “This summer, in fact, I’m reading all of Shakespeare’s works in chronological order.”Her presentation is interspersed with science fiction jokes and slides of the Starship Enterprise as she tells the assembled audience that they are now part of a company with the ability to turn the “super-cool” sci-fi ideas into hard and fast reality.

In the past few months, Google has launched Google Glass, which allows users to photograph whatever they can see, or pull up information in their peripheral vision. Then there is Project Loon, which will use giant air balloons to connect a billion people in sub-Saharan Africa to broadband.

Outside the room, self-driving cars navigate the campus. In the next-door buildings, engineers are hard at work on improving Google’s voice-activated search and translation tools, so that soon even people who cannot read or write will be able to request information in any language and find exactly what they are looking for.

Over the following few days, the new starters – or “new Googlers” (“Nooglers”) – will be drilled in the company’s mission to “organise the world’s information”, as well as its history as a “scrappy start-up” in a garage and how, as “part of the Google family”, they must keep everything they are working on a secret. “You can’t even tell your mom”, says Jennifer. At the end of the course, they will attend a staff meeting hosted by Larry Page and Sergey Brin, Google’s founders.

The glasses and the broadband balloons are examples of what Page terms “moonshot” ideas, adding glamour and the promise of new growth opportunities to what is, at its heart, a hyper-efficient advertising business.

Google’s slick web search engine helped to pull in $50.2bn (£33bn) in revenues last year, more than $40bn of which came from display advertising. Its profits stood at $10.7bn.

The service’s simple feel and complex algorithms have helped to fuel juggernaut growth over the past few years. Shares may have slipped from their May peak of $920.60, but at $877.07 they have still climbed more than 50pc in the past 12 months, handing the company a market capitalisation of $291bn. More than one technology analyst has bet their reputation on Google stock topping $1000 within the next year.

Douglas Anmuth, a highly regarded analyst at JP Morgan, last week raised his target price on Google to $1025. The bank said it was “impressed by Google’s high level of product innovation, which we expect to contribute to a more premium valuation going forward”.

But as Google’s near neighbours, Facebook and Apple, can attest, investors grow nervous at the hint of a slowdown or absence of a new growth story, never mind that the main machine is going full throttle.

Last year, Google investors took fright at a 20pc dip in profits, and a decline in the amount of revenue it receives each time a user clicks on one of its ads. The balloon project might be inspirational, but it is also there to do the basic job of stimulating demand and keeping the foot on Google’s gas.

Shareholders are also concerned about the company’s outgoings – not least the cost of its enormous appetite for Nooglers. Google had nearly 39,000 staff at the end of the last quarter, a figure which is steadily growing.

Much has been written about the free food and the zany décor of Google’s HQ – the slide in the reception, the treadmill desks, the sleep pods and the colourful bikes which employees use to get around campus. Less well-documented are the free dry-cleaning services, the complimentary coaches to work, the on-site doctors, dentists and hairdressers. Everything is designed to make life easy. And presumably productive.

The pay is also considerable. According to the jobs website Glassdoor, the average Googler – the company’s favourite term for its staff – receives $110,000 (£72,000) a year, before share awards or bonuses. Even Google interns reportedly receive the equivalent of $69,000 (£45,000) a year. Paternity leave is higher than average and, in the event that an employee dies, his or her partner can collect half of their salary for the following decade.

Just like on a university campus, staff are invited to join groups that reflect their interests. There are the “Gayglers”, for homosexual employees, and “Jewglers” for Jewish staff.

Google and its staff are almost relentlessly upbeat, which can make some people uneasy. Last week, as the first UK journalist to be allowed into the Noogler session, I couldn’t help but recall Aldous Huxley’s Brave New World. Google is as slick and polished at inducting its staff and making them feel comfortable as it is at speeding through the worldwide web and unearthing the very thing we are looking for.

The company, as Jennifer tells the Nooglers, goes to quite some lengths to hire “the smartest people on the planet”.

Google’s prowess in searching depends entirely on the quality of its engineers, many of them hired from Stanford University where Page and Brin first met. The company’s entire campus is designed to make them want to stay.

“It’s the revenge of the nerds,” says one analyst who has followed Google since it started. “These were not the guys who were popular at high school. They don’t have a girlfriend waiting for them at home. They don’t have a life outside work. This is it. But life is so easy for them, they feel they have the last laugh.”

That stereotype may be a little extreme. There are certainly enough charismatic characters to balance the archetypal geeks. They are carefully selected using the same approach Google uses for any task: crunching data.

It used to take the web search giant six months to recruit each new member of its team, but over the past few years Google has whittled it down to a highly structured process lasting 45 days on average.

After collecting information from tens of thousands of interviews, it did away with the brainteasers one might associate with an Oxbridge process, and which had become a hallmark of Google’s interview as well. Questions such as “how many aeroplanes are in the sky right now?” were, it turns out, “a complete waste of time,” according to Lazlo Bock, Google’s senior vice president of “people operations”.

“They don’t predict anything. They serve primarily to make the interviewer feel smart,” he said recently.

Instead, candidates sit through four interviews with executives they may never work with, who are on the hunt for four things. The individual’s skills are the least significant. The most important, Bock argues, are the candidates’ cognitive ability; evidence of “at least a tiny, tiny bit of humility”; and their “Googliness”.

Humility is not a trait many people would associate with this company but Googliness, at least, is a word used often on the Mountain View campus. Some employees say they found it cringeworthy when they arrived, but admit they have now adopted it themselves to describe a certain mindset. It means “comfort with ambiguity”, says Bock.

Sunil Chandra, who, as vice president of “people technology” and operations, heads Google’s recruitment machine, defines it as people who are 100pc themselves at work. “They are people who are really inquisitive and want to do what’s right by others. You’ll find that they’re unbelievably down to earth,” he says.

Whatever it is, Page must be personally convinced that new recruits have it. He signs off on every single hire – upwards of 200 staff, week in, week out – based on a “packet” prepared by existing Google employees.

There is an argument to say that this focus on hiring people in a certain image produces an echo chamber effect that puts Google at one remove from public feeling, particularly over issues such as its tax bill in Britain or the privacy of its users.

There is certainly a huge gulf between the heroic image Google paints of itself, and the giant bully of the playground sometimes depicted by its competitors – but more of that later.

Whether or not there are drawbacks to Google’s method of hiring, Chandra argues that the company’s obsession with how staff “fit in” has been key to preserving its innovative start-up culture, even as it has developed into a multi-billion dollar machine.

Managing this evolution has been a difficult task. Page, who was Google’s first chief executive, but spent a decade as president of products before he took the helm again in 2011, has made it a priority to slash the number of projects on which Google spends time and money. Google has shut down – or “sunsetted” – at least a dozen major operations in the past three years.

“We want more wood behind fewer arrows,” says Bock, borrowing his boss’s favoured metaphor. “Instead of launching 1,000 arrows at our enemies, we launch one or two big ones.

“You used to very much have a system where anyone could work on anything on the technical side. You got a lot of creativity and innovation, but what you also got was a lot of pet projects which didn’t have a big impact on the world. Or, quite frankly, you got things where we were trying to do something and someone else was doing a better job.”

One of these was Knol, a crowd-sourced encyclopedia launched in 2007, six years after Wikipedia, a similar and superior service. Knol was shut down just over a year ago. “If there is a much better thing out there, we should get out of the way and help them flourish,” Bock says.

This apparent discipline will be welcomed by shareholders. “What’s sometimes hard to appreciate is, we actually have finite resources,” says Bock, in an understatement of the concern which sometimes plagues investors. “You do have to make choices about what to invest in.

“Whilst it’s not a clear dollars and cents calculus, you know 10 engineers can have a huge impact. If you have 10 engineers supporting your product but there are not a lot of users … those 10 engineers are going to be better used doing something else.”

In the past week, reports have emerged of a Google smartwatch and a Google videogame console. It also has plans to expand its Streetview project to include hiking and biking trails, as part of its ongoing ambition to create a detailed 3D map of the entire world. But all of these are accessories to search, the project which remains its core.

The Mountain View giant already has an iron grip on the search market – its name has become synonymous with web search – but the way it views things, there is still a huge amount of change ahead.

“Google search is not done. It is far from done, in fact. I’d say it’s maybe 20pc, 25pc done,” says Jon Wiley, head of user experience for the search operation.

Users have got used to modifying their search criteria so that they extract the best results from Google, he says. The company wants them to be able to ask questions using normal speech, to have discussions with Google’s technology and to use it to find answers to subjective issues.

If you asked an interior designer what colour to paint your bedroom, they would not shoot back “red” or “green”, Wiley explains. The first thing they would do is ask questions back, about the size of the room, its aspect, what colours the person happened to like.

“This class of question where it’s not, ‘Hey, what’s the answer?,’ this continual back and forth dialogue is actually very difficult for computers to do,” he says.

“When we look at that class of problem, we say here is an opportunity for innovation for the types of problems we could try to solve. What kind of
artificial intelligence could we create that could help people actually have a dialogue about what colour to paint their bedroom?”

Wiley also hints at how the new technology will help Google harness enormous new markets in the developing world. Voice-activated search, coupled with sub-Saharan broadband, could transform education and economic growth in those regions.

“People can ask a question, get a response, and ask again, and go back and forth and have a dialogue of information, in their native language,” he says. “I look at that as a goal, to be able to have that kind of experience.

“I see all of the challenges in front of us to be able to solve that problem, and I know my day is not yet done.”

Google’s growth over the past 15 years has been driven by an “if you build it, they will come” philosophy, which remains its central tenet. The company is counting on the picture Wiley paints to keep users hooked far beyond the next 15 years.

But the company is not leaving it all down to organic growth. Its appetite for acquisition has steadily increased over the past few years. Often, deals are designed to protect the ecosystem it has built around its Android operating system, and to fend off mounting competition from the companies that were once its partners but which are increasingly its rivals.

In 2011, Google paid $12.5bn for Motorola Mobility, so that it could get its hands on a valuable artillery of patents that will help it protect smartphone producers that use Android in their copyright battles with Apple. Earlier this month, it signed a $1.3bn deal for Waze, a traffic- mapping tool that is set to transform Google’s maps service, widening its lead over Apple’s rival product.

Against this backdrop, Google’s “Googliness” can sometimes cause problems. The company has had to tread a fine line as it has expanded overseas, and come up against cultures which take a dim view of the amount of data it collects about users.

Google consistently argues that it hands individuals full control over what information they do and do not share. However, users in Europe, in particular, have been riled by projects such as Streetview, Google’s mission to photograph and map every single street in the world by driving down it with a camera, or Google Glass, which enables people to take discreet photographs without recourse to James Bond-style hidden cameras.

Earlier this month, Google was one of nine technology giants accused of routinely handing information over to the US government as part of the National Security Agency’s PRISM surveillance project. Google claims it has done no such thing, and asked the authorities to be allowed to publish statistics about the number of information requests it has pushed back on.

But even with the categorical denial, the episode remains incendiary for staff as well as the public. Google employees demanded answers from Brin and Page at their routine meeting that week, while outside Mountain View, Google-sceptics voiced their fears that the company has got far too close to both the British and US governments.

In the UK, anger has also rumbled around the company’s tax contributions. Google paid just over £10m in corporation tax to the Treasury in the past five years on revenues of £11.5bn.

Eric Schmidt, Google’s executive chairman, has argued that the company has a moral duty to shareholders to pay the tax the laws of each country say it owes and no one has accused it of breaking any laws.

Many would agree, but the row over Google’s financial contribution has still tarnished its reputation. Britons identified the web search behemoth as the fifth most desirable brand in the world last year. In the same survey this year, it had tumbled out of the top 20. Senior staff at Google privately admit the episode has taken a serious toll on morale.

“Our employees care about Google and the issues that affect us,” says Bock, with characteristic diplomacy. “We expect people to speak up when they have opinions. We have a lot of debate within the company on all sorts of topics, even the tough ones.”

Bock, who joined the company seven years ago, admits there have been some hard lessons over that period. “We weren’t always as sensitive to this as we could have been, but we didn’t know any better,” he says. “People in different parts of the world have very different sensitivities. We’ve tried to satisfy our global users, we’re a company run by people who make mistakes.”

In the early days, Google clashed with book publishers, which objected to its project to digitise every book in existence. That row, now settled, presaged a litany of viscious battles, many of them in Britain, where the vibrant creative industries feel that Google is fuelling piracy and trampling on creativity.

They have reached a sort of gritted-teeth peace for the most part, but it remains in Google’s nature to constantly push the envelope. Its modus operandi is to experiment, get products out there fast and fix any problems on the fly. “Launch and iterate” is a phrase used often.

Allied to Google’s fearless ambition, and its increasingly strategic approach to investment, is also the fleet-of-foot behaviour that will underpin its future growth. Google might shoot past the $1000-a-share mark before the year is out.

About bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

One Response to A glimpse into the world of Google; an insider’s view of the company’s multi-billion dollar search to stay ahead. Larry Page personally signs off every new recruit in a firm which now has 39,000 staff.

  1. Pingback: Detroit Doesn’t Have a “Culture” (sort of) | Civic Yuppie

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: