Shades of Google in Skepticism Surrounding Facebook IPO

While today we contemplate the future of  Facebook —  which is reportedly planning to go public by the first quarter of next year —  it may be worth remembering the buzz about Google, which also became increasingly negative in the months leading up to its August 2004 IPO.

“This could turn out to be a real dud,” Tom Taulli, a longtime IPO analyst, told the Associated Press at the time. (Taulli has since authored the book “All About Short Selling.”)

“I’m not buying,” Apple co-founder Steve Wozniak told the New York Times weeks before the offering. “Past experience leaves the taste that a few people — never ourselves — will make out the first day, but that it’s not likely to appreciate a lot in the near future or maybe even the long future.”

“For reasons that will soon be clear,” wrote Henry Blodget in Slate, “participating in the Google IPO auction is gambling, not investing, and the most likely outcome is a waste of money and time.”

“The price range — stunning even by Silicon Valley standards — is based on the assumption of continued rapid growth by Google…,” NYT tech reporter John Markoff wrote the week before the offering. “But Google’s dazzling growth has lately shown signs of slowing,” he added. “No wonder a lot of the valley’s smart money seems to see Google stock as a sucker’s bet.”

To his point, Markoff reported that not only was serial entrepreneur Jerry Kaplan down on Google but that Kaplan had advised his mother against buying Google shares. (“I wouldn’t be buying Google stock, and I don’t know anyone who would,” Kaplan told Markoff.)

Of course, everything changed as soon as the company went public.

“Google isn’t a bad company,” said the Motley Fool in the immediate aftermath of the IPO. “But we’re not rushing to buy the new shares at current levels. Great companies can be lousy investments if you buy them at the wrong price.”