As Google's Core Business Continues to Thrive, LARRY PAGE Is Making

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“The breadth of things that he is taking on is staggering. We have not seen that kind of business leader since Thomas Edison at GE or David Packard at HP.” —BEN HOROWITZ, ANDREESSEN HOROWITZ THE MOST AMBITIOUS CEO IN THE UNIVERSE

As Google’s core business continues to thrive, LARRY BUSINESSPERSON1 PAGE is making huge bets on new technology—ingestible OF THE YEAR images chiu—ap jeff nanoparticles, balloons that LARRY PAGE beam down broadband—that CEO AND CO-FOUNDER could define the future. GOOGLE

by MIGUEL HELFT

FORTUNE.COM 140 December 1, 2014 BPOY > LARRY PAGE

There’s a joke about Larry Page

that’s been making the rounds at Google X, the Page and his GOOGLE’S company have “moon shot” factory where Google is developing packed a lot of self-driving cars, high-altitude wind turbines, and RAPID RISE evolution into just 1998–2014 over 15 years of a fleet of stratospheric balloons to blanket the existence. world with Internet access: A brainiac who works in the lab walks into Page’s office one day wielding his latest world-changing invention—a time machine. As the scientist reaches for the power this high,” Teller says, raising his hand well above his cord to begin a demo, Page fires off a dismissive head, “helps people aspire to more.” question: “Why do you need to plug it in?” Andy Conrad, who leads the lab’s newest futuristic It’s a tall tale that is repeated affectionately by project—ingestible nanoparticles that would monitor the whizzes inside the futuristic lab because it people for diseases—says discussing ideas with Page is captures the urgency and aspiration of their boss a singular experience: “You feel terrified, inspired, and to move technology forward. The Google CEO is nurtured at the same time.” If setting high expectations the kind of guy who thinks the improbable is a and challenging employees to meet them is a time- given and the seemingly impossible is likely. He’s honored management tradition, then Page has taken the not one or two steps ahead of his engineers and approach to another level altogether. research scientists; he often seems to inhabit an But there’s another side to Page the Dreamer— alternate universe, where the future has already and that’s Page the Executive. For a decade Page happened. When the leader of the Internet participated in one of the most unorthodox management balloons project posited that if all went well, experiments in corporate America: Google was run Google might be able increase the Internet’s total by a triumvirate that included Eric Schmidt as CEO bandwidth by 5%, Page asked why they couldn’t and co-founders Page and Sergey Brin as presidents. double or triple the global network’s capacity. In 2011 the triumvirate dissolved, and Page assumed “He wanted to make sure there was a moon shot the CEO role. In that capacity he has asserted himself after the moon shot,” says Astro Teller, who heads and demonstrated his operational expertise. Inspired anna kuperberg anna Google X. “Reminding us that his ambitions are by management icons like Alan Mulally, the former Ford CEO who is Google’s newest board member, Page has pushed the Google juggernaut forward while transforming it to fit his grand vision. He has

FORTUNE.COM 142 $20 billion $16.5 15 Since Page became CEO in A TECHNOLOGY BEHEMOTH 2011, Google, No. 46 on the 10 THAT JUST KEEPS GROWING Fortune 500 with $60 billion in sales last year, has prospered. Its stock lags Apple’s but has 5 solidly outpaced the Nasdaq. 0 SALES

120% $3 billion $2.8

Google stock 2 90 1 Apple NET INCOME 60 0

$60 billion $62.2 30 40 Shares split 2-for-1 20 Nasdaq 0 0 CASH AND EQUIVALENTS

2011 2014 2011 2012 2013 2014

September October 2000: August August November September April 2011: Page takes April 2014: 1998: Larry Google launches 2001: Eric 2004: 2007: The 2008: over as CEO; Schmidt Google splits Page and AdWords, which Schmidt Google Android Google remains as executive its stock, cre- Sergey Brin becomes the is ap- IPOs with computing introduces chairman and Brin ating GOOGL incorporate world’s biggest pointed $27 billion platform is the Chrome takes role overseeing shares to go Google. ad business. CEO. market value. launched. browser. special projects. with GOOG.

reorganized top ranks (twice), cut numerous products, allowed Page to invest even more aggressively in unified the look and feel of the remaining ones, and both Google’s core businesses and its far-flung leaned on engineers to simplify. And with a firm hand he projects. “I used to have this debate with Steve has pushed the entire company to put mobile first. More Jobs, and he would always say, ‘You guys are doing than three years into his tenure as CEO, Google is as too much stuff,’” says Page. “He did a good job of powerful as ever. Its always-expanding core businesses— doing one or two things really well.” While the search, ads, maps, Gmail, apps, Chrome, YouTube, formula worked wonders for Apple, Page says his Android, and more—are growing at a healthy clip and vision for Google is different: “We’d like to have a touching every area of computing. bigger impact on the world by doing more things.” Apple today considers Google its No. 1 competitor. But In less than four years Page has made enormous tellingly, so do Amazon, Facebook, Microsoft, Yahoo, and strides in that direction. Google’s famed moon a long list of lesser-known tech firms. “I don’t think we’ve shots are not new. The company was working on seen a company like Google in technology,” says John Bat- driverless cars before he became CEO. But now telle, a serial entrepreneur and the author of The Search, Page—along with Brin, who oversees Google X—is a seminal book about the company’s early years. “It’s the embarking on all sorts of new groundbreaking whole package: the financial results, the reach in terms of projects. In the past year, Google has made major what markets they touch, and the ambition.” investments in artificial intelligence, robotics, and Google’s business success is undeniable. It has grown delivery drones. Google has dramatically expanded more than 20% annually for the past three years, with its venture unit, which has invested in hundreds revenue topping $16 billion in the most recent quarter. of startups and serves as something of a scouting Google’s cash hoard, about $37 billion when Page became CEO, has been growing too. The company is now sitting

graphic sources: factset research systems; s&p capital iq on some $62 billion in cash and equivalents. All that has

December 1, 2014 BPOY > LARRY PAGE

this: When the company first revealed it was working on self-driving cars in 2010, few took the effort seriously. Four years later, autonomous vehicles seem tantalizingly close, and the auto industry is spending billions on the technology in hopes of catching up. It’s a powerful example of how Page pushes the world around him into his vision of the future. “The breadth of things that he is taking on is staggering,” says Ben Horowitz, of Andreessen Horowitz. “We have not seen that kind of business leader since Thomas Edison at GE or David Packard at HP.” Page’s grand ambition doesn’t sit well with everyone. Few outside the Googleplex believe the company’s “Don’t be evil” motto is anything other than a vacuous PR line. Indeed, a growing chorus of critics—including rivals, regu- lators, and consumers—argue that Google is wielding its Clockwise from top left: Astro Teller, immense market power in brutish ways as it makes grab officially Google X’s after grab for new businesses. The criticism is especially “captain of moon shots”; Sundar Pichai sharp in Europe, where the company faces an ongoing oversees Google prod- antitrust probe that could result in billions in fines. ucts such as Android, Another criticism is that Google is a one-trick pony, Chrome, and search; ex-Ford CEO Alan Mul relying on its cash-cow search advertising business to ally is Google’s newest fund fantasy projects. But while the company still earns board member and an mcdermid—reuters brendan mulally: images; morris—bloomberg/getty paul david pichai: images; kovac—getty michael teller: adviser to Page. the majority of its revenue from advertising, during his tenure Page has helped to diversify the business. Nota- bly, YouTube is expected to generate nearly $6 billion in revenue this year, according to estimates by Jefferies, an arm for ideas fermenting outside the Googleplex. investment bank. At the same time, the Google Play store It bought Nest for $3.2 billion to pursue the dream and the company’s enterprise sales—apps and services of a fully automated home. It has put hundreds of bought by businesses—are said to be multibillion-dollar millions behind Calico, an independent biotech businesses. And Android, the world’s most successful firm hatched by Google and run by former computing platform, while distributed for free, is helping Genentech CEO Art Levinson, to fend off aging. Google shift its revenue mix toward mobile across the It’s begun commercializing glucose-monitoring company’s portfolio of products. Many of Page’s cur- contact lenses. And it continues to push Glass, its rent investments can be seen as smart wagers to secure virtual-reality eyewear that’s been met with a mix his company’s future and hedge against a slowdown in of indifference and mockery. search advertising. “He’s making the right bets on long- Google’s original mission—“to organize the term technology trends,” says Mark Mahaney, an analyst world’s information and make it universally with RBC Capital Markets. “Google would be less valu- accessible and useful”—once seemed able if it didn’t have credible bets off the home, the car, preposterously audacious. Today that vision “is and wearable devices.” probably a bit too narrow,” Page says. He wants But Page doesn’t pay critics much mind. He says he the company he co-founded as a Stanford grad is simply driven by a desire to have a positive impact. student to continue altering the world in ways He is also determined to avoid the fate of earlier tech unimaginable to most. It’s the combination of that giants that merely kept doing what they did best—and intensity of purpose with Google’s eye-poppingly eventually lost their relevance. The world’s top en- strong financial results that makes PageFortune ’s gineers and scientists don’t want to work at a place 2014 Businessperson of the Year. that keeps repeating the same tricks. And Page wants One could easily dismiss Google’s most far- Google to keep attracting the world’s best talent so that reaching efforts as pipe dreams. But consider he can build an entirely new kind of company—one that can stay at the top of its game not for a decade or two, but perhaps for generations. “It’s what’s continuing to drive me,” he says.

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or anything to do that.” He then holds the phone at arm’s length and compares its size and display capabilities to THE SCRUTINIZER-IN-CHIEF those of a large flat-screen TV further away on the wall. Amit Singhal joined Google 14 years ago, and “It’s kind of crazy,” he says. “This device at this distance he still remembers the day in 2000 when the has many more pixels than an HDTV.” company launched its first ads. That night Page But if Page gushes to the outside world about the stayed up late in his office, typing query after progress of Google’s technology, he’s often one of its query into Google. When Singhal, now the senior loudest critics internally. As part of his push to focus the vice president in charge of search, walked in the company on mobile, Page forces himself to do without next morning, the corridor walls were papered a computer during much of his day. He makes a point with printouts of dozens of searches. On each of attending meetings carrying only his phone, and he sheet Page had scribbled a pointed comment or has encouraged engineers and product managers to try question: Is this ad good for our users? Why is that to spend at least a day every week just on their mobile ad showing up? What went wrong here? “He is our devices. When something is not to his liking, he lets über-user,” says Singhal. people know. “I think my job as CEO—I feel like it’s Today Page remains very much the No. 1 always to be pushing people ahead,” he says. Google user advocate that he was back then. It’s a Alex Gawley often finds himself on the receiving end of role that suits his attention to detail, his demand- Page’s grousing. As the director of product management ing standards, and his introverted personality. for Gmail, he frequently finds missives from Page in his Page, 41, speaks in rambling sentences and inbox with very focused questions. “Sometimes it comes something of a raspy monotone. His voice, which in flurries,” says Gawley. “He gets in this zone, and he became almost inaudible a few years ago as he spots two or three things.” suffered a rare condition called vocal cord paraly- Periodically Page will demand more radical change. sis, has stabilized, but he rarely raises its volume. Two years ago Page summoned Gawley and some of his He has a full head of salt-and-pepper hair and cohorts. Gmail was great, Page said, but it was also 10 thick eyebrows. His facial expression alternates years old. It had been created before smartphones or between serious intensity and broad grins, which social networks. He laid down a challenge for the team: he flashes with regularity, especially when he gets Create a new communications service for the next 10 animated about some technology that “excites” years. Importantly, Page told the team not to think about him. (In an hourlong conversation he volunteers creating Gmail 2.0. That was liberating. “You don’t end that he is “super-excited” about this and “re- up having to design around the way we have been using a ally excited” about that and “very excited” about product for the last 10 years,” says Gawley. something else nearly two dozen times.) The work of Gawley’s team was showcased in October On a recent afternoon, as he’s getting ready when Google introduced Inbox. It’s a completely for his weekly TGIF (thank God it’s Friday) talk reimagined email app that’s been designed for mobile to the entire company, Page is dressed in jeans, phone screens. It groups messages by categories like red running shoes, and a black Lululemon zip- promotions, social, or finance, and it lets users pin up top over a plain red T-shirt. (The TGIFs, a important emails or set up reminders with a simple tradition since Google’s earliest days, are now swipe. Inbox is still in limited release, available only to held on Thursdays so that employees around the those who have been invited to use it by Google, but world can tune in via teleconference or watch a the reviews have been positive. The Verge, a popular replay before the weekend.) Page’s office is at the technology blog, called Inbox “the future of email.” end of a large fourth-floor suite furnished with Is Page’s focus on the minutiae of email the sign of a handful of sitting areas and workspaces. As a micromanager? Not necessarily. Sure, Page runs a Page sits down in a nearby conference room, he 55,000-person behemoth with dozens of products and pulls out a brand-new Nexus 6, Google’s latest business units. But veteran technologists say that a criti- flagship phone, which is made by Motorola. “If cal service like email warrants probing attention to detail you just bump it, it displays your notifications,” by the CEO. Gmail has become vital to Google. It is at the Page says. “You don’t have to enter your password core of Google’s suite of business apps, itself a multibillion-dollar business, and is a pillar of Google Now, a personal assistant that alerts users about upcoming appointments, flight delays, or traffic jams on their routes

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1. HIGH-TECH BALLOONS 2. NANOPARTICLES organizational structure as well. He brings an engineer’s mentality to management—perhaps making up for what To reach the billions of Google’s newest, most he lacks in natural charisma and public speaking chops. people across the planet secretive effort aims who are not online, to turn medicine on its Page often seeks counsel from trusted sources and then Google is experimenting head: Ingestible “paint- carefully makes moves to optimize the corporate struc- with high-tech balloons ed” nanoparticles that that would float in the can bind to cancerous ture. Shortly after taking over as CEO, he reorganized the stratosphere and beam cells and other biomark- down broadband. Today ers in your body and al- company around product units to speed up development. the balloons can stay up low scientists to “read” By all accounts it worked. Now Page is leaning for counsel in the air for 100 days at what they find. Cancer a time. In tests they’re and other diseases may on Mulally. “I’m excited about trying to spend more time delivering speeds of 10 be detected as soon as megabits per second. they manifest. with him and really learn the lessons he’s learned about how to run organizations well and efficiently,” Page says. In October, Page announced a new reorganization that he says will allow him to “scale” his impact. He put 3. ROBOTS DREAM IT, oversight for most Google products under the direct THEN GO control of Sundar Pichai, 42, a fast-rising executive who In another secretive BUILD IT effort, last year Google How does a tech previously ran important areas like Android, Chrome, and acquired a handful of company remain apps. People close to Page say that while he hopes to free the buzziest robotics dominant? CEO Larry companies, includ- Page believes the best himself of the bureaucratic decisions involved in running ing Boston Dynamics way is to invent the and Schaft. There’s a future. Through its moon large product organizations, he plans to retain his role as four-legged robot called shot factory, Google X, unofficial “chief product officer.” In a memo to Googlers, BigDog that can carry and a handful of other large loads and some skunkworks projects, Page said that the new structure would allow the company two-legged humanoids the web search giant that are good at getting is busy doing just that. to continue to push forward on its core businesses while around autonomously. Here are a few of its most ambitious bets. also getting the next generation of big bets off the ground. INNOVATING FOR THE LONG TERM

In a secret facility on Google’s campus, a team of elite home. With an audience of more than 400 mil- scientists are working on Page’s most ambitious bet yet: lion, Gmail’s position may seem secure. But con- He intends for the company to rewrite the rules of modern sider that a potential competitor like WhatsApp medicine. From the outside, the research center looks amassed hundreds of millions of users in record like any other building in the Googleplex. (Before being time, only to be bought by Google rival Facebook allowed in, a visitor had to promise not to reveal its loca- for a staggering $21 billion. In a hypercompeti- tion.) Inside, it’s a different world. Lab coats and protective tive industry, the CEO had better keep everyone eyewear are required. A series of labs spread across two focused on innovation. floors are packed with equipment—beakers and pipettes, Over the past three years Page has brought the a mass spectrometer, centrifuges, a programmable array same level of scrutiny to many of Google’s most vi- microscope, a 3-D printer. More than 100 scientists work tal products. For instance, he leaned on the search side by side, including oncologists, cardiologists, biochem- team to improve the capabilities of Google Now ists, cell biologists, immunologists, optical physicists, and and to make its “conversational search” sound experts in nuclear magnetic resonance, as well as software more natural. “That tiny kick in the back made engineers. For the past year they’ve been joining at a rate us increase the size of our speech recognition of two to four every week from places such as Stanford, team,” says Singhal. When the Google Maps team MIT, Caltech, and Genentech. demonstrated a new product for small businesses The main actors in this fast-growing life-sciences on PCs, Page insisted that they had to first release startup, however, are nowhere within sight. They are it on phones. Fresh from building a new house in nanoparticles, about 1/2,000th the size of a red blood Palo Alto, Page brainstormed with Nest CEO Tony cell. Google’s plan is roughly the following: to chemically Fadell on topics ranging from air and water qual- “paint” the nanoparticles with a protein, amino acid, or ity to safety, security, and home automation. genetic material so that they can bind to certain things Page believes in regular evolution in Google’s like, say, a cancer cell; to put the nanoparticles in a pill that can be swallowed so that they can course through people’s bodies; and to concentrate them through magnetized wearable devices so that they can be “queried.” In theory

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gan researching—by Googling, of course—the properties of balloons. “Eventually, I found this balloon image from the system would allow constant monitoring so 1960,” he says. It “had gone around the earth, like, five that a whole host of diseases could be detected— times.” Half a century later, with much better materials and treated—well before they would with existing available, he concluded Google could improve on that. diagnostic tools. Conrad, who as head of Google X Page has the capacity and curiosity necessary for Life Sciences oversees the project, says it could deep academic study. Today he can debate the subtleties change medicine from “reactive to proactive.” of Project Loon’s tech specs with any of his engineers. Today we go to the doctor when we are ill, he says. During a meeting with Teller last year, he began It’s as if we changed the oil in a car only when the discussing how Google could exploit different wind car breaks down. “There has to be a better way,” speeds at different elevations to concentrate bandwidth Conrad says. over densely populated areas and cover larger swaths of You could be forgiven for thinking this is a sci-fi territory in rural areas. “I’ve never had a conversation movie plot. But Google and a host of biotech and where he wasn’t at least in danger of being ahead of me, nanotech startups, including some that are Google even in the areas I spend way more time on than he does,” partners, have already proved many of the project’s says Teller, the grandson of the physicist Edward Teller, component parts in principle. While immense known as the father of the hydrogen bomb. Page says it’s hurdles—scientific, regulatory, societal—remain, also part of how he manages the company’s armies of MIT’s Robert Langer, one of the world’s leading alpha scientists. “Deep knowledge from your manager biotechnology experts, says Google’s willingness goes a long way toward motivating you,” Page says. “And I to venture where other companies won’t may help have a pretty good capability for that.” turn the theory into reality. “A lot of companies in Management trick or not, Page’s research-rooted the medical area, sadly, are more afraid of taking mindset also explains how different a company from, risks,” says Langer, who has advised Google scien- say, Apple Page is aiming to build. Fadell, who before tists but is not affiliated with the project. founding Nest led the development of the iPod and Regardless, no one is likely to pop pills with iPhone at Apple, says Page and Jobs approached the Google logo anytime soon—or perhaps ever. innovation in radically different ways. “Steve was a Conrad says that if Google succeeds, it will partner marketer who really loved product and got the user- with others to commercialize the technology. And experience details right,” Fadell says. “Larry is a serious in classic Google fashion, Page has already made technologist and someone who is really steeped in a bet that’s complementary in Calico. Conrad says science and in theory, and he has a real love of product.” that while Calico focuses on extending “maximum” Of course, even visionaries get things wrong. Google has lifespan, his group works on “median” lifespan by tried projects in areas like energy and philanthropy that trying to fend off disease. “Larry looks at one or have not panned out. And the list of Google product flops two ways in which a problem should be solved and and disappointments, including some championed by places very strategic bets on both,” Conrad says. Page, like Google+, is lengthy. At the same time, there have Page says he is often drawn by what he calls the been enough successes that many investors are willing “zero-million-dollar research problem”: an inter- to go along for the ride. What if Google’s medical project esting challenge that no one is working on. Before revolutionizes cancer treatment? There will be great value Google X’s Project Loon launched balloons that in that. “They have almost cartoonlike ambitions,” says Ben could stay aloft for more than 100 days, covering Schachter, a longtime Google analyst at Macquarie Securi- vast distances at an elevation of 60,000 feet, the ties. “Some, including us, think of that as a positive.” idea of using balloons for telecommunications Page looks at Google’s projects as a portfolio, a “bucket was a quintessential example of such a project. of investments.” Some are short-term, others are me- Page says he’d been interested in it since gradu- dium or long-term bets. He says he is fairly certain some ate school in part because satellites, which power will pay off. And while the investments are sizable, they most of our communications, take years to build are also gradual. “By the time you know you want to put and cost millions of dollars to launch—a huge a significant amount of money into something, you’re barrier to innovation. So a few years ago Page be- pretty sure you’re going to make money from it,” says Page. “It’s not that the risk is so high.” To the most ambitious CEO on the planet, clearly the bigger risk is in not trying to conjure the future.

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