Initial Public Offering Essay

Google is one of the most successful online companies. The company has started its business in the late 1990s and reached a tremendous success in the 2000s. In this regard, it is worth mentioning the fact that the company focuses on the further development of its business and market expansion. At the same time, to expand its market successfully the company needs substantial investments. This is why the company has taken the decision to go public and started IPO to attract investors and to gain the attention of leading investors and allowed the company to raise substantial funds. In actuality, Google holds a leading position in the market outpacing its major rivals, such as Yahoo and Microsoft. Nevertheless, Google attempts to outpace its rivals through IPO as the means to improve its marketing performance and accelerate its business development through the attraction of investors through IPO.
In actuality, Google is one of the leaders in the industry. In this respect, it is important to place emphasis on the fact that the development of business by Google has brought considerable benefits to the company. At this point, it is possible to refer to the Table 1 (See App.), which shows the steady financial performance of the company at the moment. In this regard, it is worth mentioning the fact that the company has improved consistently its financial performance after IPO. In other words, after going public, Google has improved consistently its financial position.
At this point, it is important to dwell upon the decision of Google to go public and its short-run effects. In fact, Google’s IPO announcement comes when the company is at the top of its game, having come out of nowhere to the former leader, Yahoo, with a simple, stripped-down service that beat nearly everyone in delivering relevant search results. Google had an audience of 60 million unique visitors, or 40 percent of all U.S. Internet users, in February, according to Web measurement company ComScore Networks. Its audience has grown by nearly 25 percent since February 2003 (Olsen and Kawamoto, 2004). In such a way, the starting point of going public was quite strong for Google. At the same time, after IPO, the position of Google has improved even more. When the offering finally happened, it turned an estimated 1,000 Google employees into millionaires, at least on paper (Edmonston, 2009). In such a way, the company has improved consistently its position in the market. In fact, the company focused on IPO as the means of attraction of investments and enhancement of its position in the market.
At this point, it is worth mentioning the fact that Google faced certain problems after going public. To put it more precisely, the company focused on the application of the egalitarian principles, while exiting IPO. What is meant here is the fact that Google paid little attention to investors and their background. What the company was really interested in was raising funds for its faster economic development and consistent enhancement of its marketing position and its financial position. In the course of several years, Google turned from a prospective company into the behemoth of the online business, which marketing value has outgrown such giants as GM and exceeded $100 billion in the course of four years after going public (Edmonston, 2009). At the same time, the egalitarian principles have undermined the fast progress of the company, when Google has just decided to go public. The little attention to the choice of investors and analysis of their background led to the situation, when customers started to doubt in the reliability of the company and its ability to conduct independent policies. In other words, the reputation of Google was under a question because customers and business partners were uncertain that Google will pertain its traditional business policies and maintain the positive company-customer relationships. In addition, the public grew anxious about the risk of the monopolization of the market by Google after IPO. In such a way, the egalitarian principle applied by Google at the beginning of its IPO experience has proved to be quite controversial and the company had to change its policies and become more selective in regard to its investors.
Nevertheless, as Google started its IPO, the company has improved its position consistently, whereas its employees became millionaires. Moreover, there are also a few billionaires, like Google’s founders, Sergey Brin and Larry Page. Regulatory filings show they each own Google shares with a market value of more than $12 billion, based on Google’s stock price in midmorning trade on Wednesday (Edmonston, 2009). At the same time, owners of the company just benefited from the company, which they have created but the actual marketing position of the company has become consistently better and its financial position more stable. In fact, IPO accelerated the business development of the company and improve consistently its financial performance. Therefore, the company became the true behemoth of the online business because the company increased its capital and market values enormously. For instance, originally priced at $85 each, Google’s shares soared past $600 in 2007 and closed in 2009 at a still-respectable $445.28. It has also served as a currency for acquisitions, like Google’s $1.6 billion purchase of the video-sharing service YouTube three years ago (Edmonston, 2009). In such a way, the company increased consistently its share price since the beginning of IPO. Obviously, the company became one of the leaders and one of the desirable subjects to the investments, especially from the part of companies operating in the software industry and online business. In fact, the company attempted to enhance its position through the development of new, more effective strategies of going public. To put it more precisely, the company shifted from the egalitarian approach to a more selective approach to the choice of investors. In this regard, Google has proved to be quite successful and reached a tremendous success.
At the same time, it is important to point out the fact that going public opened the way to a qualitatively new level of development of the company because the company has proved to be flexible and introduced changes in its IPO policies. The company attempted to improve consistently its position through offering its share to the public and attracting investors to raise funds to develop new projects and implement them successfully. At this point, it is worth mentioning the fact that the company has started to introduce innovations after going public at the faster pace compared to its early years of development. Even though Google was always oriented on innovations, the company gained huge financial resources for the development of new projects and introduction of innovations as Google went public.
Thus, taking into account all above mentioned, it is important to place emphasis on the fact that Google is one of the most successful companies, which has reached a tremendous success in the course of a couple of decades. At this point, it is necessary to point out the fact that the company accelerated its development after going public. IPO allowed Google to attract substantial financial resources, which the company invested in the development of new products and their introduction en masse. As a result, the company took the lead as the major search engine and as one of the major players in the online business. Moreover, recently, the company has started to enter the smartphone industry and develop its own software that opened new opportunities for the company to enhance its position in the market. At the same time, the company could hardly implement such large scale projects and complete them successfully. As a result, Google keeps progressing and holds a strong financial position.