matters. Growth matters. Get on a rocket ship and all things take care of themselves.’”
She was employee number 268. Her title was business unit general manager, even though, as she had noted, there was no business unit. There was also no CFO, which is perhaps why Eric Schmidt assigned her a top secret mission, kept even from their venture capitalists, to investigate a potential round of private financing to pump money into a four-year-old company that had yet to have a profitable year. Among the people Sandberg spoke with was Mary Meeker, the author of the seminal Internet report at Morgan Stanley. Their discussions, Meeker said, made her take greater notice of Google. “Before Sheryl arrived,” said Meeker, “they were so quiet and private. She was part of a push to bring people in.” Months and many meetings later, Sandberg made a PowerPoint presentation to the founders and Schmidt. The consensus of the people Sandberg consulted was that Google should be valued at one billion dollars. The consensus of the founders and Schmidt was that they would not pursue more investment capital because this valuation was, she said, “a total insult.”
The project was shelved. “I needed another job. I knew I wanted to work for Omid Kordestani, who runs all business and operations. We were launching AdWords CPC.” Kordestani planned to expand the AdWords staff from four to eight. “Omid said to me, ‘I need a tractor. You’re a Porsche. Why do you want this job?’”
She thought their ideas for selling ads were innovative. If they worked, they would be efficient—by cutting out sales teams—and bold, giving advertisers an incentive to make the ads more relevant. Advertisers would rank higher on the search results page based not just on the price they bid per keyword, but on the number of clicks their ads received. The more clicks, the lower the price, and the higher they would rank.
Advertising, Schmidt said, had not been viewed “as a priority” by the founders—nor, according to Doerr, by Schmidt. And, indeed, Schmidt had become convinced that since Google had succeeded in building the best search engine, the money would follow. But by 2002, at the helm of a four-year-old company that had yet to have a profitable year, Schmidt knew it was time to focus on money. But he also knew Page and Brin had definite ideas about what was “evil.” Senior software engineer Matt Cutts recalled that a credit card company (it was Visa) offered five million dollars to put a link to their credit card logo on the bottom of Google’s home page. But Page and Brin wouldn’t budge, nor would they relax their strictures against advertisers paying for search results. “Google was really trying to do right by their users,” said Benjamin A. Schachter, then the senior Internet analyst for UBS. But they weren’t building a profitable business.
Moritz was becoming restive, openly wondering if Schmidt was tough enough. A Google insider with direct knowledge said that in 2002, Moritz pressed for Schmidt to be fired. Another insider said the unhappiness with Schmidt was at first shared by others who also worried that he wasn’t tough enough, that he was moving too slowly to galvanize a management team, to challenge the founders, and most especially, to find a revenue stream.
Schmidt remained calm, at least outwardly. By late 2001, he knew of the effort at Google that Sandberg was now working on to devise the new version of AdWords, the advertising program associated with search. In AdWords as it worked through 2001, advertisers paid Google the old-fashioned way, based on a cost per thousand (CPM) whether the searcher clicked on their ad or not. What Google was quietly exploring was switching to a cost-per-click model, an idea that built on the Overture model. In addition to Sandberg, Omid Kordestani assigned Salar Kamangar, the author of the original Google business plan, to serve as a bridge between the engineering and the sales team as they improvised.
This began a long and intense period of brainstorming. The team liked the idea of charging by the click, thinking it was a way they could farm out not just search, as they had done with Netscape and Yahoo, but also advertising. “We knew we needed a lot of ads, and to have a lot of ads we also had to syndicate,” Kamangar said, performing the search function for sites like Yahoo but also selling ads for them. He knew that Page and Brin would resist allowing advertisers to pay