Splitting the name of Google\u2019s new holding company Alphabet into two \u2013 \u201calpha\u201d and \u201cbet\u201d \u2013 may help explain the new business structure that JP Morgan analyst Doug Anmuth called \u201can elegant way for Google to continue to pursue long-term, life-changing initiatives while simultaneously increasing transparency and management focus in the core business\u201d in a recent report. \u00a0\nAlpha is \u201cinvestment return above benchmark,\u201d noted Larry Page in the company\u2019s announcement of the new name and structure on its new website, abc.xyz. The word \u201cbet\u201d could refer to all the long-term bets Google has made in a spectrum of big ideas \u2013 some would call them moonshots \u2013 including driverless cars, life sciences, home automation and robots.\nThe new company\u2019s core (alpha) businesses \u2013 such as search, maps and YouTube \u2013 will still be called Google. Sundar Pichai, who was promoted to CEO as part of the announcement, will report the results of Google\u2019s operations separately beginning in Q4 2015. The moonshots, the \u201cbets,\u201d will also be reported separately.\nAs Alphabet CEO Larry Page mentioned in his blog post about the restructuring, Google has a track record of successfully launching products that are now used by billions of people (YouTube, Google Maps, Android, etc.). Alphabet looks like a new innovation management and finance model, a formal approach to incubating businesses into large-scale operations.\u00a0\nSeparation anxiety?\nYou can imagine that Page and cofounder Sergey Brin are passionate about the many moonshots incubating under the old Google corporate structure. But large cap investors might find them an unprofitable distraction from the core revenue and profit-producing business in which they invested. Fund managers with perspectives narrowed by the necessity of quarterly earnings expectations can\u2019t model and place a value on projects like the autonomous car. Those kinds of moonshots could require large loss-making investments during a five year or longer horizon to bring to market and become accretive to Alphabet\u2019s earnings.\n[Related: Don\u2019t look for Google to make big, quick changes after Alphabet pronouncement]\nPleasing large cap investors with Alpha investment results and betting on new businesses to find the next big growth area do not coexist comfortably with one another. According to Page, the price of comfort is reducing growth expectations to incremental change. Emphasizing the dilemma, Page said \u201cin the technology industry, where revolutionary ideas drive the next big growth areas, you need to be a bit uncomfortable to stay relevant.\u201d\nStanford economics professor Nicholas A. Bloom explains how Alphabet will make investors comfortable: \u201cThere are two benefits of the new structure. One is visibility, in that with the split it makes it easier to model the main search business from the distracting moonshots. The second benefit is it contains the moonshots, because as separate businesses it is much harder to fund them under the radar. Fund managers were nervous about Google tunneling cash from the search business to other long-shot ventures unchecked, and with the Alphabet model they cannot do this. Google has put constraints on how much its founders Page and Brin can fund moonshots, and the market not surprisingly likes this.\u201d\nGood fences make good neighbors\nLast quarter \u2013 and consistently throughout the company\u2019s history \u2013 over 90 percent of Google\u2019s revenues have been produced by its search advertising and Google sites businesses including Google Play and YouTube.\nIn a report about the new structure, Nomura research analyst Anthony DiClemente underscored the idea that increased transparency should increase shareholder value. \u201cInvestors have long desired better visibility into the trends and profitability of Google\u2019s core business outside of investments in more speculative projects like Google Fiber, Project X and Calico,\u201d DiClemente said. \u201cUnder the new structure, opex investment in these more long-term investment initiatives will be excluded from Google\u2019s reported results, providing investors a clearer picture of the core businesses underlying trends.\u201d\n[Related: Google restructuring could rein in business 'chaos']\nDiClemente\u2019s report pointed out that investors can value the core business\u2019s revenues and profits without the drag of investment in the moonshots. They don\u2019t value the potential big growth areas as much as understanding the amounts that Alphabet will invest in incubation.\n\u201cWhat we don\u2019t yet know about Alphabet may be the most interesting,\u201d says Harvard Business School professor of entrepreneurial management Thomas R. Eisenmann. \u201cAlphabet could finance the moonshots\u2019 growth by selling equity (called tracking stocks and letter stocks) that restricts the new investors ownership to just a moonshot business or segment and wouldn\u2019t consume any of the $68 billion of cash on Alphabet\u2019s balance sheet. Management\u2019s necessary long-term horizon for these businesses might also be protected by issuing shares to new investors with proportionately fewer votes per share like the original Google initial public offering.\u201d It seems like ancient history now, but new outside investors in Google received one vote per common share, compared to the 10 votes per share held by founders and venture investors, which left existing investors in control,\u201d he says.\nIf adopted, Eisenmann says, \u201cThis new capital structure would naturally sort investors based on risk and reward.\u201d\nWith access to outside capital as described by Eisenmann, the incubating moonshots have a better chance to become high-growth businesses like YouTube, Google Maps and Android without making large cap investors uncomfortable. And if all goes well, some of Wall Street may value Alphabet more on transformative expectations and growth than just revenues and profits like it has for near-profitless Amazon and profitless Tesla.