Original: Stage 1 can load Stage 2 directly, but it's normally set up to load Stage 1.5. GRUB Stage 1.5 is located in the first 30 kilobytes of hard disk immediately following the MBR and before the first partition.
Simplified: Stage 1 can either load Stage 2 directly, or it can load stage 1.5: GRUB Stage 1.5 is located in the first 30 kilobytes of hard disk immediately following the MBR.