Google Inc. announced last month that it is forming a $100 million fund called Google Ventures to invest in early stage startups.
The fund’s two managing partners are Rich Miner, co-founder of Android, a developer of smart phone software that Google acquired in 2005 for its mobile operating system; and Bill Maris, who founded Web hosting company Burlee.com. Miner will be based in Cambridge, Mass., and Maris will be based in Mountain View, Calif.
In late March, Reuters first reported that Google was forming a VC unit after Miner appeared at an investor conference for Internet startups with a name tag that listed his name alongside Google Ventures. Google had no comment at the time.
But the Internet company revealed its operations in an April press release. In the release, Miner said that Google Ventures will look at a wide variety of companies to invest in, including consumer Internet products, information technology, health care and biotech, among other areas.
“Just as we were founded by entrepreneurs, we think we can help some of those next entrepreneurs with the next great idea,” Miner said.
Google Ventures will be wholly owned by Google. In-house venture funds, such as those managed by Intel Corp. and Motorola Corp., typically are designed to make strategic investments that may feed the company new ideas. But Maris said that Google Ventures will have more in common with traditional venture capital firms. Google Ventures will operate as a separate entity and will seek investment opportunities to maximize returns rather than looking to invest in startups that fit in with Google’s vision, according to the Google press release.
“We’re making financial return our first lens,” Maris said.
The fund will focus primarily on companies seeking seed funding and early stage funding, and Google Ventures will have the ability to make investments ranging from tens of thousands to “several tens of millions” of dollars, Maris said.
Google Ventures has already invested in Pixazza Inc., a photo-based online marketing service, and Silver Spring Networks, a company that uses technology to improve the efficiency of power grids.
Google has invested in other companies in the past through its philanthropic division, Google.org. In August, Google.org participated in the $26.25 million second round of funding for Sausalito, Calif.-based AltaRock Energy Inc., a developer of geothermal technology. Co-investors included Advanced Technology Ventures, Khosla Ventures, Kleiner Perkins Caufield & Byers and Vulcan Capital.
Just as we were founded by entrepreneurs, we think we can help some of those next entrepreneurs with the next great idea.
Rich Miner
Additionally, Google.org invested about $4 million in Potter Drilling Inc., a Redwood City, Calif.-based company that is developing a hard-rock drilling technology.
While Google.org may continue to make investments from time to time, Maris said that Google Ventures will now function as Google’s “primary vehicle” for making venture-style investments. —Alexei Oreskovic, Reuters
DEALWATCH: Five investments by Google.org
AltaRock Energy Inc._Enhanced geothermal systems (EGS) technologies.
Aptera Motors_Plug-in electric vehicles.
BrightSource Energy Inc._Solar thermal power.
Makani Power Inc._High-altitude wind energy extraction technologies.
Potter Drilling_Hard-rock drilling technologies for EGS.
Source: Google.org, philanthropic arm of Google Inc.
