{"id":1466,"date":"2022-09-25T14:01:17","date_gmt":"2022-09-25T14:01:17","guid":{"rendered":""},"modified":"2025-09-26T08:49:33","modified_gmt":"2025-09-26T08:49:33","slug":"story-jeff-bezos-250000-investment-google-1998","status":"publish","type":"post","link":"https:\/\/www.growthink.com\/content\/story-jeff-bezos-250000-investment-google-1998","title":{"rendered":"The Story of Jeff Bezos\u2019 $250,000 Investment into Google in 1998"},"content":{"rendered":"
\n

To be filed firmly in the categories of the rich get richer and it does usually make sense to be both <\/strong><\/em>lucky and good, most people don’t know that Jeff Bezos was one of the early investors in Google.<\/p>\n

Yes, that<\/strong><\/span> <\/em>Jeff Bezos. Founder of Amazon.com and #1 on the Forbes\u2019 400 list with a net worth of $182.6 (note that when I first wrote about this in 2009, Bezos was #33 on the Forbes\u2019 400 list and his net worth was only (I know…) $8.7 billion!)<\/p>\n

The story is this – in 1998 when Larry Page\u2019s and Sergey Brin\u2019s Google offices were a Menlo Park, California garage – Bezos invested $250,000 of personal funds into the fledgling search engine in a $1 million follow-on investment round.<\/p>\n

When Google went public in 2004, that $250,000 investment translated into 3.3 million shares of Google stock. At Google\u2019s IPO that represented a\u00a0 stock share position worth over $280 million<\/strong>!<\/p>\n<\/div>\n

\n

While Bezos does not disclose how many of those shares he still holds, at the current price of Google stock they would represent an investment position of over $1.5 billion<\/strong><\/em>.<\/p>\n

Why did Bezos invest in Google? In his words, \u201c\u2026There was no business plan<\/a>\u2026They had a vision. It was a customer-focused point of view.\u201d And more tellingly he adds, \u201cI just fell in love with Larry and Sergey.\u201d<\/p>\n

In addition to being a tale to which the normal reaction is to just say \u201cwow,\u201d Bezos\u2019 Google investment offers a number of great lessons for aspiring, private company investors:<\/p>\n

1.\u00a0 \u00a0 He Thought Long Term. <\/strong>Even though Google has been the fastest rocket ship growth company in the history of capitalism, it was still SIX YEARS from Bezo\u2019s investment in the company to liquidity. Private equity overnight successes simply do not exist.<\/p>\n

2.\u00a0 \u00a0 He Got In Early. <\/strong>Sure, it would have been great to get into Google at its IPO price of $85\/share, especially as the shares are up over 535% since then. But Bezos got in, after adjusting for stock splits, at EIGHT CENTS PER SHARE<\/strong>!<\/p>\n

Talk about leverage. That translates to a 112,000 percent<\/strong> increase from investment to IPO, and then if he held onto the shares to another 535% on top of that.<\/p>\n

3.\u00a0\u00a0\u00a0 He Invested in People. <\/strong>At the time of Bezo\u2019s investment, there were a large number of very well-funded and far more successful search engines already on the market. Remember this was 1998 not 1994. Yahoo. Alta Vista. Lycos. Excite. Looksmart. Webcrawler. Infoseek. Inktomi and GoTo to name just a few.<\/p>\n

But Bezos was attracted to Page and Brin as people, as technologists, as leaders. And obviously their customer-centric focus really tracked the way that Bezos looks at the world and is embodied in the Amazon<\/a> customer service experience.<\/p>\n

So while a business opportunity, in its abstract is great, evaluating the people leading a business is a FAR MORE RELEVANT investing best practice.<\/p>\n

4.\u00a0\u00a0\u00a0 He Took a Shot.<\/strong> For every Jeff Bezos who invested in Google, there are stories of literally dozens of investors that were presented with the opportunity and did not.<\/p>\n

This of course does not mean that the probability of any early stage private company investor having a Google-like success in their portfolio is anything but very low, but it does mean that it is far greater than the ZERO percent likelihood of success of those who did not invest.<\/p>\n

As they say, you can\u2019t win if you don\u2019t play.<\/p>\n

5.\u00a0\u00a0\u00a0 He Got Lucky.<\/strong> As hard as it is for many to accept, luck is a key, and sometimes the key, variable in successful investing.<\/p>\n

As opposed to fighting or getting philosophical re this reality, a far better question to ask is \u201cHow can I improve my likelihood of, for lack of a better turn of phrase, getting lucky<\/strong><\/em>?<\/p>\n

One way to ensure you “get lucky” is to make sure you include each of the elements of a business plan<\/a> in your plan and follow and update it often.
\n <\/p>\n<\/div>\n