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Alphabet at Two: How Google’s Radical Reorganization Has Paid Off

It’s been two years since Google co-founders Larry Page and Sergey Brin shocked Wall Street by unveiling a sweeping reorganization of the company. 

On August 10, 2015, the internet giant announced the creation of Alphabet Inc. (GOOGL) , the holding company that oversees its core Google business and the numerous moonshot bets exploring emerging technologies such as glucose-sensing contact lenses and delivering remote internet access via balloons. The new structure has made it much easier for the Google subsidiary (which includes the search business, Google Cloud, YouTube, Android and Chrome) to remain separate from the hodgepodge of “Other Bets” overseen by Alphabet and which Page referred to as “bets in areas that might seem speculative or even strange.” 

Page recently ruminated on the two-year anniversary of Alphabet in a January letter to shareholders, where he said the new structure has resulted in greater transparency for investors. It has also created a leaner, more efficient Alphabet whose constellation of companies each have a better chance to succeed, he added. Page emphasized that each business is meant to be autonomous with its own CEO, while still being a part of the general Alphabet umbrella. 

“We have streamlined efforts where it made sense and in other areas we have seen places to double down,” Page wrote. “I also think we have learned a lot about how to set up new companies with a structure for success.”

Over the past two years, Alphabet’s roster of Other Bets has grown from six businesses to 11 different units. Waymo, Alphabet’s self-driving car unit, was spun off into its own company in December 2016; Alphabet’s AI research incubator DeepMind has expanded considerably; Google Ideas, a tech-focused think tank, spun off to become Jigsaw in February 2016; Alphabet’s smart city project SideWalk Labs launched into a separate unit; and Capital G, one of Alphabet’s investing arms, has been broken out. 

The other primary businesses that fall under…

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