Why did Google's co-founders step down?

Why did Google's co-founders step down?

The announcement came with an extract from the company’s very first founders’ letter in 2004:

“Google is not a conventional company. We do not intend to become one. Throughout Google’s evolution as a privately held company, we have managed Google differently.”

Yesterday evening, Sergey Brin and Larry Page — arguably two of the most influential people of the 21st century to date — announced that they were stepping down as president and CEO of Alphabet respectively. Google’s current chief executive Sundar Pichai will take over CEO duties at Alphabet immediately and the role of president will be eliminated.

In light of this management shake-up, it’s important to take a step back and consider the company in its enormity — a research project started in Stanford University that grew into a $900 billion dollar leviathan controlling some of the most important technological assets in the world. Google Search, the Android operating system, YouTube, Maps, Gmail, Chrome — all of these products are used billions of times a day by people the world over. And then take into account other aspects of the business like Waymo (self-driving cars), Calico (biotechnology), Verily (life sciences) and Deepmind (A.I.) — any of which could fundamentally change the future of humanity.

But let’s get our head out of the sky and look pragmatically at the company as it exists today. As many commentators have already pointed out, both Brin and Page have been noticeably absent from the day-to-day running of Alphabet for quite some time now. Since taking up the role of Google CEO back in 2015, Pichai has been the public face of the company while the co-founders involved themselves with their own projects. Because of this, shareholders probably shouldn’t be too concerned about this development affecting the company’s trajectory — it has been effectively the case for the past 4 years anyway.

This is where that extract from the first founders' letter — "we have managed Google differently” — becomes particularly relevant. When you look across the spectrum of founder-led companies on the market today, you see that the likes of Elon Musk and Jeff Bezos treat their companies as their babies, intimately involved in every decision (for better or worse). Brin and Page have run Google differently over the past few years, and although we must also consider that they will remain on Google’s board and together retain an 11.5% controlling stake, they seem to have been more than happy to hand over the reins of the real business to Pichai a long time ago.

So why leave now?

Is it unreasonable to ask if they are leaving or fleeing? A cynical view to take, perhaps, but it’s obvious that the problems have been lining up for Google recently, with increasing scrutiny growing on allegations of sexual assault, harassment, and inappropriate relationships amongst the higher echelons of the company. Or what about the widespread employee unrest, most recently the four workers that were allegedly fired before Thanksgiving for trying to organise workers?

The pressure is coming from outside too, with most of the Big Tech companies now in the crosshairs of both domestic and international regulators over data collection practices and anti-trust concerns. In perhaps the best example of the co-founders’ removal from the realities of the company, Larry Page famously failed to appear before a congressional hearing last year regarding efforts to thwart Russian government-linked campaigns to sow political division in the U.S. Not a great look for a company whose motto was once “Don’t Be Evil”.2019 has been a year of unprecedented CEO turnover. In the first nine months of the year, it was reported that 1,160 CEOs in the U.S. had left their jobs — the highest recorded rate in history. There are a myriad of reasons for this (some of which we discussed in last Thursday’s Insight, ‘When Is It Time For Founding CEOs To Pass The Torch?’), but with Brin and Page, it kind of feels that they just didn’t want the trouble of being in charge anymore.

Perhaps the best summation on the story comes from Casey Newton out in his excellent email newsletter, ’The Interface’:

"Page and Brin’s Google was a historical triumph. But there’s little that feels triumphant about their sudden departure. The heat turned up on Google, and they decided to head for the exits. Google’s outsized success will dominate stories about their legacy. But the way they left — bored and mostly absent in a time of crisis — is part of their legacy, too.”

JamesJames

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