GoTo.com put a price on the top of the search page. Advertisers bid on a keyword, the highest bidder showed up first, and they paid only when someone clicked. Rival search engines made their money from banner ads. GoTo's model turned out to be the one that would pay for search across the web. When the Pasadena company went public in June 1999, it had been running for about a year and was losing money fast.

An Idealab Brainstorm

Bill Gross ran Idealab, a Pasadena incubator that spun out one company after another. GoTo.com was incorporated in September 1997 and opened in 1998. It let advertisers name what they would pay to appear at the top of the results, and every click cost that amount. Idealab owned about 24 percent of the company going into the offering. The bet was that ads ranked by price could still be useful to the person searching, and could pay for search itself.

Yahoo's Billion-Dollar Answer

GoTo.com priced 6 million shares at $15 on June 18, 1999, above its planned range, and the stock jumped on its first day. It soon found its real business: supplying paid listings to bigger portals. In 2001 it renamed itself Overture Services. Yahoo came to rely on Overture for about a fifth of its revenue. In 2003 Yahoo bought the company for about $1.63 billion in cash and stock. Overture's system lived on as Yahoo Search Marketing.

Cover: The Orchestra, Jean Louis Forain. Art Institute of Chicago, public domain. Chosen for an orchestra (Overture).