Google has unveiled a new approach to its business management, creating a new parent company it has tapped as Alphabet, with Google co-Founder Sergey Brin as its President.
The decision to forge a new identity and launch a new parent group will have large ramifications on investors and individuals alike. Alphabet will be replacing Google (NASDAQ:GOOG) as the publicly traded company in the US stock market, with all Google shares becoming Alphabet shares – subsequently, Google will become a wholly owned subsidiary of Alphabet.
More specifically, Google will retain its core search and advertising operations and businesses, in conjunction with its maps, YouTube and Android utility, according to a recent SEC filing. However, nearly all of Google’s other ventures will be run separately under the Alphabet umbrella.
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The move is heralded as a win for the fintech industry, given that Alphabet will have a much easier time investing or creating its own fintech subsidiaries. Even before the announcement and genesis of Alphabet, Google Ventures has been active in the fintech realm via a number of investments in OnDeck, The Climate Corporation, DataFox, LendUp, Ripple Labs, and Upstart, among others.
“We liked the name Alphabet because it means a collection of letters that represent language, one of humanity’s important innovations,” explained Google’s co-Founder and Chief Executive Larry Page. “And, it’s the core of how we index with Google search.”
Alphabet’s leadership will now be headed by a new trifecta – Mr. Page will become the new CEO of Alphabet, while Mr. Brin will now be its acting president. Finally, Eric Schmidt is now slated to be the new Executive Chairman at Alphabet, leaving Sundar Pichai as Google’s new CEO.