If Google had used a traditional IPO process when its stock debuted 10 years ago, it would have made less money, the Silicon Valley pioneer who crafted the Dutch auction deal told CNBC on Tuesday.
"Some of the original price ideas from the traditional bankers were $60 to $70 a share," Bill Hambrecht said in a "Squawk Box" interview, a decade to the day since Google became a public company. That range would have been about 30 percent less than the actual pricing level. The search giant debuted on Aug. 19, 2004, after 19.6 million shares were priced at the low end of the revised expected range at $85 each, which valued the company at the time at $23 billion.
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"The two major buyers—the guys who really made the auction work—were Fidelity and Legg Mason, Bill Miller," Hambrecht said. "They're the guys who put in the bids at $85 that really solidified [the process]."
Google stock closed at just more than $100 a share on its first day of trading—a solid 18 percent increase but not the blowout day that had been expected for one of the hottest offerings since the dot-com bust of 2000.
All these years later, it seems unbelievable that at the time, there were questions surrounding what Google even did. "It was very controversial. There were an awful lot of people that didn't get it," Hambrecht recalled.
But a decade later, all that's changed. Google is now a household name, and on a split-adjusted basis both classes of its stock traded just under $600 a share as of Monday's close. The company has a market value of nearly $400 billion.
