Google Amasses $100 Million For Start-Up Venture Fund

Google is a big player in several technolgy fields, but until now, the search giant hasn't been a major player in high finance. The company recently amassed a fighting fund of $100 million to form a new venture capital entity. It looks as if Google is trying to spend its way out of the economic crisis. 

The fund is named Google Ventures, and though it will be wholly owned by Google it will operate fairly independently—its investment purview apparently extends beyond the fields dominated by its parent organization. This includes fields as diverse as "consumer Internet, software, clean-tech, bio-tech, health care." The whole point is to find and invest in likely start-ups with the aim of realizing large financial returns, and it will trade on the strength of the Google name, with the possibility of connecting its target companies with Google technology and research.

Heading up the new fund are Rich Miner, who co-founded the smartphone OS-maker Android, and Bill Maris, founder of a Web hosting company and former portfolio manager for a Swedish industrial holdings company. Miner set out the core mission behind Google Ventures by saying "Just as we were founded by entrepreneurs, we think we can help some of those next entrepreneurs with the next great idea." His new entity has the power to grant funds between tens of thousands of dollars to "several tens of millions" to start-ups that seek both seed and early-stage funding.  

Google.org has made philanthropic investments in the past, and may continue to do so occasionally, but Ventures is now expected to be the main vehicle. At the helm, Miner and Maris will work with David Drummond, who's senior VP of corporate development and chief legal officer at Google. That raises the question whether Google is using the $100 million as a acquisition fund—but Google has stressed that's not the main intention.

But is it a good idea? Absolutely. New ideas are surfacing during these touch economic times just as at any other time, and Google is in a financially secure enough position to take a risk as a venture capital investor. That places it in position to reap the cash benefits if its chosen investment companies take off. And when the economy turns the corner, Google may even find itself ahead of the game with a hand in innovative new businesses or even whole new fields of technology—that's the sort of return you can get for "tens of millions." 

Related: Reuters, eWeek.com]

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2 Comments

  • Bill Mahar

    The key here for the next big thing is to have a way to monetize your investment. Twitter spent 20 million and did not have a monetization method. A company I have been trying to find information on is http://www.boomja.com. Both Google & Yahoo agree that the next wave of search is human edited search. Boomja.com is on the right track and I think they will be the next big thing on the internet because they have a monetization method, are already creating revenue, are delivering a great product for their target audience, and creating limitless jobs by partnering with their users. Imagine combining Wikipedia with Google. Boomja uses humans to organize the internet, splits advertising impressions with editors, and creates targeted search categories. This is a natural fit for Google because they use Google’s AdSense ads to generate revenue.

  • David Osedach

    This is great news. I urge Google to take a look what it can do for the car industry. Maybe even manufacturer "The Google" automobile: economical, safe, and state-of-the-art.