Written by: Taranjit Singh
Date: 27-11-2023
In 1998, four years after Amazon's inception, Bezos made a pivotal decision: he invested in a nascent search engine startup operating out of a garage in Menlo Park, California. This startup, helmed by the brilliant minds of Larry Page and Sergey Brin, two Stanford Ph.D. students, was none other than Google.
Bezos's investment in Google transcended mere financial speculation; it was an unwavering belief in vision and innovation. He injected $250,000 into Google during a $1 million follow-on investment round. This decision stemmed not from elaborate business plans or projections but from an instinctive trust in the individuals behind the venture. In an interview with Ken Auletta, author of the book "Googled: The End of the World as We Know It," Bezos confessed, "I just fell in love with Larry and Sergey." His investment mirrored his deep alignment with their customer-centric philosophy, a principle he championed at Amazon.
Bezos's investment decision epitomized three key principles:
1. Long-term Thinking: Despite Google's meteoric rise, it took six years after his investment for any liquidity event to materialize. This underscores the often-overlooked virtue of patience in venture capital.
2. Impeccable Timing: Bezos's timing was impeccable. He entered the game early on, securing a stake at a price that, after adjusting for stock splits, amounted to a mere 8 cents per share.
3. Investing in People: Bezos invested in the people behind the idea, choosing Google over established competitors like Yahoo! and Alta Vista. His decision wasn't solely driven by the potential of a business model but by an unwavering faith in Page and Brin's capabilities and vision.
When Google went public in 2004, Bezos's $250,000 investment transformed into 3.3 million shares of Google stock, worth over $280 million at the time of the initial public offering (IPO). Had Bezos retained these shares, given Google's current stock price, they would represent an investment worth over $1.5 billion. It has been reported that Bezos no longer holds this stake. If he had retained it, the value would have reached around $4.8 billion, a gain of nearly 20,000% in just over two decades.
Bezos's investment in Google, alongside his Amazon venture, serves as a testament to the transformative power of backing startups early on. Today, platforms like StartEngine democratize this opportunity, enabling anyone to tap into this potential. Investing in startups extends beyond financial gains; it's a gateway to fostering innovative ideas that have the potential to shape the future. Imagine discovering the next Amazon or Google. This makes startup investing an exciting avenue for anyone eager to contribute to and grow alongside emerging leaders in technology and business.