Episode 33: Overture (with the Internet History Podcast!)

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.

Sponsors:

• Sierra: https://bit.ly/acquiredsierra
• Sentry: https://bit.ly/acquiredsentry
• Anthropic: https://bit.ly/acquiredclaude25
• Vanta: https://vanta.com/acquired

More Acquired!

• Get email updates with hints on next episode and follow-ups from recent episodes
• Join the Slack
• Subscribe to ACQ2
• Merch Store!

© Copyright 2015-2025 ACQ, LLC

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