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Google: Now Playboy's Latest Bunny

By Robert MacMillan
washingtonpost.com Staff Writer
Friday, August 13, 2004; 9:44 AM

Investors in the company that's trying to come off as cute as a bunny could find themselves holding a fistful of vipers if the founders of Google Inc. continue to chart their erratic course.

That's the verdict from most financial analysts as Google revealed in a Securities and Exchange Commission filing that founders Sergey Brin and Larry Page bared their souls to Playboy Magazine for its September issue. They made the announcement earlier today, even as would-be investors began bidding for shares at 9:30 a.m. ET this morning.

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"Google said the text of the Playboy article, which it added to its prospectus, 'presented certain statements about our company in isolation and did not disclose many of the related risks and uncertainties described in this prospectus,'" the Wall Street Journal reported. "The company said in the filing that it doesn't consider the participation in the Playboy Magazine article to constitute a violation of SEC rules, but 'if our involvement in a September 2004 magazine article about Google were held to be in violation of the Securities Act of 1933, we could be required to repurchase securities sold in this offering,' it warned." The company has since released a version of the prospectus that does not say whether the interview could delay the offering.

This is, of course, the latest twist in the most eagerly anticipated public stock offering to come out of the tech sector in literally years. Since April when the company filed its prospectus for the possibly $3.3 billion IPO, the company and its founders have debuted new products, made all sorts of statements that flirted with federal rules against hyping the company and upon examination from the press, often clammed up and insisted that they had to respect their pre-IPO "quiet period."

But never mind all that. Let's get to Playboy. Rushing past the pictures of the nice ladies on the Web site, we tried to find the interview, but only discovered an excerpt (warning: adult content may be visible) and an invitation to buy a copy. No word yet on whether newsstands in the Financial District are seeing an uptick in sales this morning.

News.com's Jeff Pelline, meanwhile, got his hands on a copy and provides some quotes:

Brin on the future use of Google: "Probably in many new ways. We're already experimenting with some. You can call a phone number and say what you want to search for, and it will be pulled up. At this stage, it's obviously just a toy, but it helps us understand how to develop future products."

Page on whether Google would "sell out:" "No. We think we're an important company, and we're dedicated to doing this over the long term. We like being independent."

The Journal reported that the interview was conducted on April 22, five days before Google filed its public offering prospectus. Nevertheless, the paper said, "the timing could still cause problems. The SEC's rules on the exact timeframe covered by the quiet period are vague, but regulators consider companies to be in the period even while they are still preparing IPO documents and working with investment bankers, according to people who specialize in IPOs."
Google Interview May Set Back IPO; Auction Starts Today
CNET's News.com: Excerpts From Google Co-Founders' Playboy Interview

The New York Times collected some good quotes from financial experts. They're mostly shaking their heads. "Any good securities lawyer would advise a company that was about to file a registration statement not to talk to the press," said Stuart Bressman, a lawyer with Brown Raysman Millstein Felder & Steiner in New York. While companies can continue to make information available about their products and services, he said, "any kind of communication that is out of the ordinary is not O.K."

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