Also Thinking About Google

Posted by: Heather Green on February 27

I think Fred Wilson is one smart cookie. But even better, I like the way he just puts his thoughts out there on his blog, which is afterall, the blog of an investor who is comfortable with risk and growth companies.

The post he writes on Google today wraps up exactly the zeitgeist you have with growing companies. The problem and the potential of a company like Google is that you don’t know how much of the overall ad market it will swallow. We can get averages for growth in the search market, but even there, we don’t know how big that market will eventually be. That’s why, when we see hints that the market may be slowing, investors dump the stock fast and start looking at cash flow rates.

The unknown is how Google can grow in mostly untested ad markets, like local and maps. And that’s where faith has to take you. And basically where it takes Wilson. Is he right, is he wrong? The most fascinating thing about this whole story, what keeps us riveted to Google is he and we can’t know.

TrackBack URL for this entry: http://blogs.businessweek.com/mt/mt-tb.cgi/