The search giant started offering big incentives to prevent Googlers from exiting for hot start-ups; one engineer reportedly received a $6 million counter-offer after she announced she was leaving the company for Facebook.
Companywide, Google recently gave its workers a $1,000 holiday bonus as well as a 10% pay raise for 2011.
But for some, money just isn't enough.Google, whose "20% time" rule allows engineers to spend one workday a week working on projects they find personally interesting, has fostered a culture of innovation that practically encourages employees to depart to pursue their own ventures. "Even firms that are as resource rich as Google have a limited capacity to exploit the full spectrum of all the innovative output being created by its employees," said Mike Haynie, a professor of entrepreneurship at Syracuse University's Whitman School of Management. In response, many former Googlers -- or Xooglers, as they call themselves -- are forming their own start-ups. Ironically, several have already been acquired by Google, like social search engine Aardvark, document collaboration company AppJet and email application reMail. While Xooglers have begun to create waves outside of Mountain View, it's still too early to tell if their success will mirror the talent drained from PayPal, whose former employees went on to start LinkedIn, Yelp and YouTube, or from Netscape, whose alumni founded Tellme Networks -- now part of Microsoft (MSFT) -- and prominent venture firm Andreessen Horowitz. Read on for some of the most innovative start-ups founded by former Googlers.