[Infowarrior] - Google To Launch Venture Fund

[Richard Forno]

Google To Launch Venture Fund
Michael Arrington
http://www.techcrunch.com/2008/07/30/google-to-launch-venture-fund/

The WSJ is reporting that Google is set to launch a venture fund to  
give it the option of investing in startups instead of just flat out  
buying them. The fund will be led by Google’s SVP Corporate  
Development David Drummond and Bill Maris, a long time business friend  
of Anne Wojcicki, Sergey Brin’s wife. Maris is a tech entrepreneur  
with a degree in neuroscience and worked with Wojcicki at a San  
Francisco-based for-profit company called Catalytic Health.

This hasn’t been confirmed by Google, and it’s clear they’ve been  
thinking about a fund off and on for years. From the article:

     The move would make Google the latest technology giant to take on  
a more-formal role in seeding start-ups. Intel Corp. has had a large  
venture-capital arm for years, as have Motorola Inc., Comcast Corp.  
and many others. In the consumer-Internet area, Walt Disney Co.’s  
Steamboat Ventures has invested in a number of Web start-ups. So has  
Amazon.com Inc., which has funded a number of young companies without  
structuring a formal fund.

     Their track records have been mixed. Corporate venture-capital  
arms have been hampered by challenges that traditional venture-capital  
businesses don’t face. Venture capitalists invest in private start-ups  
at an early stage, usually in hopes of a big payout if the company is  
sold or if its stock goes public.

     Many start-ups fear that taking corporate money limits their  
options and comes with strings that could turn away other potential  
investors — such as a right to buy the company at a later date. Some  
funds with less competitive compensation have struggled to retain  
managers, and corporate venture funds often don’t allow senior  
employees to invest personal money in their funds, while other venture  
funds typically do.

This wouldn’t be the first time Google started a fund to invest in  
other companies. In June 2007 they launched Gadget Ventures, a pilot  
program that, in part, invests seed money in companies looking to  
develop for the gadgets platform. They have also previously invested  
through Indian VCs.