BY DAVID SPEAKMAN

The last dot-com company standing from the venture capital-funded class of 1999 says it has no interest in going public.

Google Inc. co-founder Sergey Brin told the assembled crowd at the PC Forum in Scottsdale, Ariz., March 25 that the online search company has no plans for an initial public offering.

Because Google of Mountain View is projected to be valued in a public offering at more than $2 billion, Brin’s no-IPO stance is seen by some analysts as kicking a down technology IPO market in need of a Google-sized boost.

“Basically, we’re not planning an IPO,” says Cindy McCaffery, a Google spokeswoman. “Our focus is really on the business and continuing to innovate with our technology so that we’re leading in the search space.”

McCaffery says by not being a public company, Google can spend money on long-term planning rather than having to answer to the stock market every three months with quarterly reports.

“We have a research team that is looking at search a year out or so,” she says.

The team is spending money on developing technology to search voice, video and other Internet content that is not yet profitable.

Google is also one of the few Internet companies with a large hiring program during a time when public companies face investor pressure to cutback on staff to meet quarterly numbers.

“We have something around 800 employees now,” McCaffery says, explaining that as a private company, Google is able to pay top dollar for talent. “Absolutely, by bringing in the best and the brightest now, we can build a very solid company.”

Some solid companies opt never to go public. Forbes magazine publishes an annual list of private companies with estimated revenues of at least $1 billion. The 257 companies on the current list employ 3 million workers worldwide and contribute more than $700 billion annually in goods and services to the economy, according to Forbes. The list of private companies includes No. 6-ranked construction service company Bechtel Corp. and No. 23-ranked apparel maker Levi Strauss & Co., both of San Francisco, and No. 107-ranked San Jose-based retailer Fry’s Electronics Inc.

Staying private affects a company’s shareholders.

With $25 million in first-round funding in June 1999, Menlo Park-based venture capital firms Sequoia Capital and Kleiner Perkins Caufield & Byers gained a significant share of Google stock.

Google, on the other hand, gained money needed for growth and one board member from each firm. Neither returned Biz Ink telephone calls for this story.

But other venture capitalists see a more investment-savvy reason this may be the wrong time for Google to go public.

“I think most venture-backed companies are holding off on any IPO plans that they may have had,” says Jeanne Metzger, a vice president of the National Venture Capital Association (NVCA) of Arlington, Va. “The stock market continues to be extremely turbulent and the situation in the world today just is not a wonderful time to go public — especially for a technology stock like Google.”

Kate Mitchell, managing partner of BA Venture Partners of Foster City, agrees an IPO may not be the best exit strategy for Google right now.

“It’s a rational decision from the standpoint not to rush to go public in a very difficult time,” she says.

Although Mitchell is not privy to Google’s reasoning to stay private, she says although a $2 billion valuation looks big, Google could be worth more in a better market.

“My guess is Google doesn’t need the cash,” Mitchell says. “They’d be smarter to stay below ground because of the flexibility.”

NVCA’s Metzger agrees a lack of an IPO for 4-year-old Google is no surprise.

“When a venture capitalist looks at an investment, they’re thinking it’s going to take between five and seven years before they see a return on their investment,” she says. “For all startup companies, including Google, their hopes are to get profitable so that they can sustain themselves and choose the timing to go public.”

Although as a privately held company, Google doesn’t make its corporate performance available to the public, industry insiders believe the company is profitable now.

But BA Venture’s Mitchell says that there is still no rush for Google’s VC funders to cash in yet.

“The company can get more of a track record,” she says. “Profitability and growth continue to get more interesting to investors over time.”

Because of that, Mitchell says in this case a delayed IPO will probably be more profitable in the long run.

“Google is a fabulous company and I am envious of the investors there,” she says.

Roaring out of retirement, motorcycle company CEO builds a brand

BY DAVID SPEAKMAN

The war in Iraq reminds Indian Motorcycle Corp. president and CEO Louis Terhar of the two defining moments in his life — a tour of duty as a young officer during the Vietnam War and the birth of his first child.

An engineering graduate of the U.S. Naval Academy, Terhar says he learned how to prioritize things at a young age.

“Right out of the academy, I went to Vietnam for a year,” he says. “I found out very quickly there are some things that are important and there are some things that are critical. Something’s critical if somebody’s going to die — everything else in life is important.”

Three decades later, with a wife and four children, Terhar was enjoying an early retirement and teaching graduate school at Xavier University in Cincinnati after a successful corporate career.

He had no idea fate was conspiring to lure him from retirement to head a struggling, privately-held, motorcycle company.

While he was teaching at Xavier in 2001, venture capital investor The Audax Group of Boston gained control of Gilroy-based Indian Motorcycle with a $45 million stock buyout. Shortly afterward, Terhar got a telephone call from Audax, which learned about him from a corporate headhunter, asking him if he’d leave retirement, move to Gilroy and take the helm of a motorcycle company struggling to turn a profit.

“Lou is a real leader of people,” says Steven Kaplan, managing director of Audax Group. “While in the Navy, he commanded a seal support team.”

But that battle-hardened demeanor has softened around the edges during the years. Terhar’s typical Midwestern politeness takes a reflective and more personal turn when discussing his military career.

“One of the things you learn in the service is to be a team player,” he says. “It carries over into everything you do.”

Terhar says watching news about the U.S. invasion of Iraq on television stirs up decades-old memories.

“The thing I think about much more when I see stuff on CNN is not where the troops are on the map,” he says. ” I think about the young officers and the kids — and they are kids — who are out there going through a life-changing experience. You just hope they come through OK, and they get out.”

During his naval career, Terhar’s first child, a daughter and the only girl out of his eventual four children, was born.

“Before my daughter was born I had no thought of leaving the Navy,” he says, leaning forward, becoming more engaged in the conversation as he talks about his family. “After we had a new baby in the house, that completely changed my outlook on what I wanted to do with my life. I decided going into business where I could be home to see my kids grow up was more important to me than a military career.”

“When you have that first child, you look at that little baby sitting there and you realize that’s your responsibility,” he says. “Life takes on a whole new meaning for you.”

After he left the military, Terhar earned graduate degrees from Syracuse University and Harvard and entered business, Terhar eventually worked for industrial conglomerate W.R. Grace & Co., as director of European operations for tool maker Black & Decker and as president and CEO of scrap steel giant David J. Joseph Co. of Cincinnati before retiring in his early 50s.

Terhar, the oldest of nine children raised on a carpenter’s income, says his modest upbringing inspired him to reach out to disadvantaged children through various philanthropic and charity efforts.

“I didn’t even know I was poor until I went to high school,” he says.

It was Terhar’s history of succeeding despite the odds that got Audax’s attention, thinking him a perfect fit for Indian.

“Lou is someone who can get his hands dirty and dive into the details operationally,” says Kaplan. “We were very much looking for someone who could drive all of the operational and engineering issues at Indian to world-class levels.”

Kaplan says Terhar’s experience allows him to set realistic goals, drive quality and understand engineering minutia that could bog down a leader without an engineering degree.

Still, getting the Cincinnati native to leave his beloved hometown was no easy task.

“When this came up, I wasn’t very interested in going to California,” Terhar says. “But my wife, who knows me better than I know myself, … told me I was a little more bored teaching than I realized.”

So Terhar went to Boston to visit Audax and was convinced to fly to Northern California to visit Indian where he quickly rediscovered his passion for riding motorcycles.

“I came here and I really fell in love with bikes again,” Terhar says. “I rode when I was young and suddenly it was like a rebirth of youth. The machinery is gorgeous. If you’re an engineer and you don’t love a bike, there is really something wrong with you.”

But was pursuit of that reborn love worth leaving Cincinnati?

“I still had two boys in high school,” Terhar says. “They had been going to the same school since they were children and my wife also teaches there.”

But, after talking to his family, Terhar decided he could have both worlds — he would take the job, but his family would stay in Cincinnati.

During the weekdays, he lives in Pacific Grove and commutes the 42 miles to Gilroy. On weekends, Terhar usually is racking up airline frequent-flyer points by jetting 2,500 miles back and forth to be with his family in Ohio.

“My wife said, ‘This is something you gotta do, and if you have to commute for a while, that’s fine,'” Terhar says.

He says the tradeoff is worth it for now.

“I look at this place and I think it’s such a strong brand,” he says. “This is a billion-dollar name. The company just has to grow into that name.”

Terhar does have experience growing billion-dollar companies. He took David J. Joseph Co. from sales of $300 million to $1.1 billion when he was there.

But talking to him on a Thursday afternoon, you can tell Terhar is looking forward to being back in Cincinnati with his family.

Although he rolls his eyes at being called a “family man,” Terhar is obviously a devoted, if long-distance, father and husband.

“The difference between being married and being married with children to me is a big transition,” he says. “I know a lot of people who are married who don’t have children and I think to myself, they really don’t get it.”

A U.S. Attorney in eastern Missouri charged eBay Inc.’s PayPal online payment service with violating the Patriot Act, which was signed into law after the Sept. 11, 2001 terrorist attacks.

The San Jose auction giant said it was served notice March 28, and charged with allowing online gamblers to pay for gambling debts with PayPal. Online gambling is illegal in the United States.The Patriot Act outlaws money transactions for known illegal activities.

eBay says its service was acting in good faith and did not violate federal law.