Is Google retooling itself for a more ballsy social networking strategy that – as some salivating web commentators speculate – aims to challenge Facebook’s omnipotence? This certainly looks likelier following the $182m (€145m) acquisition of Max Levchin’s “community-driven entertainment company” Slide.com in August and the near-simultaneous shuttering of the underwhelming Google Wave. Levchin, who became Google’s vice-president of engineering as a part of the deal, was quick to blog that it was a “tremendous opportunity to change the way people socialise on the web”.

Slide.com is a curious business. At first it was all about helping people pimp their blogs and Facebook profiles with accessories such as photo slideshows and plug-ins, such as the infamous Super Poke, which allows you to get the attention of friends by, say, throwing a sheep at them. Today the site centres on engendering communities where users can interact, play games, and develop distinct personalities.

“There really isn’t anyone that competes with Slide on the same plane,” says Levchin, who made his name as co-founder and chief technology officer of PayPal before its $1.5bn buyout by eBay in 2002. “We create an environment for people to have a virtual conversation; an interesting moment or two; a space where they can feel engaged. Users come back for each other as opposed to coming back to something we can make.”

At first, money came in from advertisements, but in the past year the business plan has shifted and Slide earns all its revenues from virtual goods, a market estimated $1.6bn (€1.25bn) alone in the US this year. Within communities like SuperPoke! Pets, for instance, users can pay to acquire goods or decorative items for their habitats, or even design and sell their own for real money. Around one million virtual items are sold each day via SuperPoke! Pets alone. “The notion of virtual existence versus non virtual existence is going to be blurred withevery passing year,” says Levchin.

While Slide is undoubtedly an intriguing addition to the Google arsenal, the bigger story is likely to be what Levchin himself brings to the table. “He’s known the Google people for many years, and they respect him a lot – this isn’t a random, overnight decision on either part,” says PayPal co-founder and venture capitalist Peter Thiel.“Max is a creative and brilliant person and an extremely original thinker with an encyclopedic knowledge of the internet. A world-class engineer. At the same time, he is probably one of the most driven people I know. He will make things succeed or at least try really hard.”

James Hong, best friend and founder of Hotornot.com, can attest to that. Business or pleasure, he says, Levchin will always push himself to the limit: “When he gets into something he really gets into it. So when he started cycling, it became just like business, fixating on the metrics: ‘How far did I go? How many watts did I generate?’ And then every week its like ‘Oh, man I did 20% more than last week’.”

Levchin reportedly made around $39m (€30m) from the Google deal, eclipsing the reported $36m he received from eBay, but success and wealth do not seem to have mellowed the man that Silicon Valley gossip blog Valleywag once half-jokingly labelled a cyborg. “I’m definitely as intense as I’ve always been,” he concedes.

Levchin was born in Kiev, Ukraine, under Soviet rule and raised in a Jewish house by intellectual heavyweights. His father was a writer and poet; his mother a theoretical physicist. Other live-in family members included his grandfather, who founded his own experimental research institute to advance oil discovery and extraction processes, and his grandmother, a widely published double PhD astrophysicist. “My grandmother was this 5’2” lady who would tell me I have to eat my veggies and then engage in a multi-hour conversation about variable stars. Neither seemed out of place for me,” Levchin recalls.

When he turned 16, the Levchins moved to Chicago due to several reasons: the fallout from Chernobyl, problems his father “was having with the KGB”; anti-Semitism (Levchin remembers one day when he couldn’t go to school until a Star of David daubed on their front door was removed); and the fact he was approaching draft age. Once in the US, Levchin set about integrating himself as fully as possible, learning to speak English by watching Diff’rent Strokes on a TV he salvaged from a dumpster. An obsessive, multi-lingual programmer since the age of 11, Levchin enrolled at the University of Illinois at Urbana-Champaign, a place with a reputation for churning out entrepreneurial computer prodigies such as Netscape founder Marc Andreessen, and Lotus Notes and Microsoft’s chief software architect Ray Ozzie. It did not take long before Levchin was headhunted.

“These two guys walked in to the computer lab and said ‘You’re famous for not sleeping and writing lots of code. We’re going to start a company; why don’t you come and write code with us instead for no apparent reason’,” Levchin recalls.

SponsorNet, an attempt to build one of the web’s first banner ad networks, failed, but Levchin was bitten by the start-up bug, and promptly packed his belongings into a truck and drove cross country for five days until he reached SiliconValley.

His next two ventures failed and another, Secure Pilot, selling security software for Palm Pilots, was going nowhere when he chanced upon a lecture at Stanford University by Peter Thiel, then making a name for himself as a hedge fund maven. Levchin recalls that he thought “what the hell“and slunk in to join an audience of just seven.

The story goes he rescued Thiel from an obnoxious inquisitor, and they arranged to have breakfast the next day. Levchin pitched several ideas, and Thiel decided to invest in what would become Confinity, a cryptography company that enabled users to beam money tokens from one Palm Pilot to another. A website, PayPal.com, was established so that funds could be reconciled and transferred to bank accounts.

Confinity officially became PayPal in 1999 when it merged with X.com, a financial services outfit that facilitated email payments, and the service as we know it today started to take shape. EBay had launched its own online payment system, Billpoint, prior to PayPal bursting out of the traps, but its functionality – particularly in terms of security and user-friendliness – was inferior. So much so, that eBay was barracked by its own customers to adopt PayPal as its preferred online payment option. When PayPal went public in February 2002 (the prospectus listed the average age of the executive team as 29), eBay had no choice but to buy out its competitor.

PayPal’s success was built on an obsessive attention to detail and, most crucially, the momentum and innovation of an elite corps of hungry young intellectuals, an unusually high number of which have since established pioneering start-ups of their own (see below).

Getting hired at PayPal was not easy – involving hours of logic and problem-solving puzzles, and Levchin’s “aura test”, which entailed a circuitous conversation to gauge company compatibility. The eventual head of business development had to fly out eight times to go through the latter before he was hired. “It was probably the single most onerous interview process you can ever imagine,” says Levchin.“Even if they were the receptionist, we just wanted to have the smartest people everywhere.”

Post-PayPal was a difficult time for Levchin. Aged 26, rich beyond his wildest dreams and with no inclination for ostentation, he drifted, taking on a brief stint at venture capital firm Sequoia Capital, but mostly just reflecting on an aching absence of purpose.

“I finally got a kick on the butt by my wife who said ‘you should go rent an office and start a company, because that’s what you do and everything will fall into place,” says Levchin.

He did just that. With the help of some of his ex-PayPal buddies, he started a brainstorming process that yielded Yelp, a social networking-oriented review and local search site which Levchin seed funded, and, of course, Slide. Levchin’s next move would inevitably catch the imagination, and venture capitalists such as the Mayfield Fund, Blue Run Ventures and Khosla Ventures duly signed up.

At one point in 2008, the company was valued at $500m.

The price Google eventually paid has prompted some to gloatingly point to comments Levchin once made to the press saying he’d consider any exit below the PayPal figure to be a failure. Thiel is quick to defend him.“In any sane part of this world this deal has to be considered phenomenal,” he says.“Nobody who invested in Slide lost any money.

On many levels it was an extremely respectable exit.”

Levchin, for his part, remains philosophical, determined, above all, to look forward.

“I was a little bit younger and I intuitively knew what I wanted to say but didn’t quite say it as eloquently as I should have,” he says. “The point of outdoing PayPal, or outdoing anything, is to have a bigger impact on the world. My goal for a while – my self-evaluation goal if you will – is to try to remain as relevant as possible.”

THE PAYPAL MAFIA – WHERE ARE THEY NOW?

PETER THIEL
Co-founder & CEO
Credited with helping Facebook take off with an early $500,000 investment. Started Founders Fund with fellow PayPal alumni Ken Howery and Luke Nosek in 2005.

REID HOFFMAN
Executive VP
Founder of LinkedIn, the social network for business professionals, and a successful angel investor in firms including Facebook, IronPort, Digg, Flickr, Ping.fm, Last.fm, and Zynga.

ELON MUSK
Co-founder/ founder of X.com and CEO.
Founder of electric vehicle maker Tesla Motors and SpaceX, a private space exploration firm, and chairman of the philanthropic Musk Foundation.

STEVE CHEN / JAWED KARIM
Engineers
Founders, in February 2005, of video-sharing site YouTube, which was bought by Google for $1.65bn in October 2006.

DAVID O. SACKS
Chief operating officer
Founder of social networks Geni.com, and Yammer, and movie production studio Room 9 Entertainment, which produced Thank You for Smoking.