Google's newest venture
Today we're excited to announce Google Ventures, Google's new venture capital fund. This is Google's effort to take advantage of our resources to support innovation and encourage promising new technology companies. By borrowing the best practices of top-tier …
Context & Ripple Effects
Google’s move from a 2007 venture-capital role and 2008 plans for a venture arm to a formal fund turns an anticipated extension of the company’s reach into an operating investment vehicle. The stated aim is to pair capital with Google’s resources in support of promising technology companies.
First-order effects
- Google Ventures gives technology startups a new source of funding backed by Google, while giving Google a formal channel for investing in companies outside its own product organization.
Second-order effects
- Established venture firms seeking the same technology investments face a better-resourced prospective co-investor or rival, increasing competition for promising deals.
Third-order effects
- The launch points toward a corporate-venture model in which large technology companies use capital alongside operational resources to build earlier ties to emerging companies.
The trend: Large technology companies are extending their strategic reach by combining venture funding with the operational resources available to portfolio companies.