Dr Jeff Cornwall

There has been much speculation about a possible IPO by Google in the near future. Although this may be necessary to satisfy the VC’s that backed the company, it is a step that should be taken with great care.

Things always change when a company goes public. The founders often think that this will not happen to their company, but I have never seen a case where, eventually at least, the pressures of the broader group of shareholders fail to win out over the desire of the founding entrepreneurs to keep things the way it has always been. The IPO puts the company in a fish bowl. All of the decisions that were made in private must now see the light of day. Unique companies become quite common as a result.
The lure of the ?big pay day? entices many to consider an IPO. For Google, it could mean billions of dollars in market capitalization. It may sound strange to ask such a question when billions of dollars are on the line, but here it goes: at what cost? The corporate culture of Google will change over time once they go public. It will have to. It is an inevitable outcome of an IPO.
The money that goes into their Googleplex headquarters will begin to come into question once the first hint of disappointing profits arise. The attention given to creating and maintaining such a unique place to work will begin to be criticized. What are they doing there? Are they are getting too soft in a competitive market? Why don?t they act more business-like? How can they expect to compete with management practices like that?
Eventually the market always wins out. Public companies must, by definition, focus only on one measure of success: short term profits. Corporate cultures, corporate citizenship, and so forth are only tolerated by the market until growth slows. Even if it is only a temporary slowdown, pressure will begin to mount for change.
I know they will never see my blog site, but on the off chance that they do, I hope that Google co-founders Larry Page and Sergey Brin pause long enough to ask themselves two questions. Why did they take such care to build such a unique culture at Google? And how much wealth is really enough, anyway?