Episode 33: Overture (with the Internet History Podcast!) Ben & David dive deep into the early days of internet search, with the help of the best in the internet history business: Brian McCullough from the Internet History Podcast! We are huge fans of IHP at Acquired, so this was a real treat to collaborate with Brian and the great work he does over there. In this episode we cover the story of how a small incubator in Southern California spawned perhaps the greatest tech business model of all-time, Yahoo!’s fumbling of that golden opportunity, and Google’s recovery of that fumble to cross into the end zone of tech history behind the biggest moat ever constructed on the internet.

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Topics covered include: • Overture’s origins as part of the Idealab • incubator run by famed early internet entrepreneur Bill Gross • Invention of the paid search business model… initially by returning ADS ONLY in response to search queries • The eventual marrying of Overture’s paid search (ads) with organic search results via syndication on other properties like Yahoo! • Revenue from Overture’s ad partnership saving Yahoo!’s business after the internet bubble burst • Yahoo!’s eventual acquisition of Overture for $1.4B in 2003 • But… the really interesting story here: Overture’s 'inspiration' of Google’s business model and the creation of "the greatest advertising machine in the history of the world" • The original (pre-Overture) Google business model: selling a box • ! • Google’s differentiation vs Overture: focusing on the long tail • , ad quality scores • , and an advertiser-friendly auction structure • Google’s first major search syndication victory over Overture: AOL • Yahoo!’s failed attempt to buy Google for $3B in 2002 • , leading it to settle for acquiring Overture instead the following year • “ Project Panama • ” at Yahoo!, and its impact on the tech and internet history • Overture's (and later Yahoo!’s) lawsuit against Google • for stealing the paid search business model— "the O.G. version of Snapchat and Instagram” Paul Graham’s take on "What Happened to Yahoo?” • Perhaps the most important technology to come out of this whole episode: Hadoop • The power of incentive alignment in marketplaces— and creating the widest and deepest moats on the internet

The Carve Out:

• Ben: The famous University of Washington's “Love Lab” Dr. John Gottman • : “ The Secret to Love is Just Kindness • ” • David: Berlin • Brian: The Dark Valley: A Panorama of the 1930s