Alphabet Explained

Google, the company that has their hands in almost everything made a huge business move. They created an umbrella company to encompass all of their investments called Alphabet. What is Alphabet? Why would they do this? Is Google still Google? Alphabet is new, it’s bold, it’s actually kinda genius.

Google started off as a search engine and as they continued to do that well they made heaps and heaps of money. Google decided to invest that money over the years into some obvious places, but has also bought some very risky ventures. So what is Alphabet, the easy answer, a way to satiate investors by splitting up “search” and all their other investments. Google has purchased companies like Nest and invested in ventures like Loon. They have encompassed these ventures under Google X, but by doing so investors have blurred the lines with conventional Google and these projects. Google will be Google still, they will still focus on search, Chrome, and Android. Now that these investments are separate they can allocate money more effectively and account for growth or loss for each individual company under Alphabet.

When the Alphabet acquisition is finalized all companies under its umbrella will have their own CEO’s. By doing this those companies will get more concise attention from its CEO’s and they will be held directly responsible for the company’s growth or lack there of. The structure of Google’s CEO will be changing as well. Larry Page and Sergey Brin will be the CEO’s of Alphabet and Sundar Pichai will take over as Google’s CEO. Larry made it quite known that they are very happy with Sundar and are very excited to have him as CEO of Google.

“We liked the name Alphabet because it means a collection of letters that represent language, one of humanity’s most important innovations, and is the core of how we index with Google search! We also like that it means alpha‑bet (Alpha is investment return above benchmark), which we strive for!”

This is a bold move for sure, and from their standpoint its a perfect one. Larry made it very known that they are ambitious with trying new and exciting things and this is the best way to continue to do this. I personally love all the things that Google has sunk their teeth into over the years. Yes search is their fundamentals, but they are so much more than just that now. They are a company with vision and the means to turn that vision into reality. Now under the umbrella of Alphabet they have more of a chance to do this.

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