Try Google.

Google is poised to open a new venture capital arm but the structure of the organization and the type of investments in largely unclear. How well they will do as a VC operation is also cloudy and thus the potential new division may fail to materialize. Large corporate VCs are often hampered by challenges that more traditional VC groups don’t face. For example, many startups fear the limitations corporate money places on their future with other investors and with buy up options. Also, this last year has seen drops in the number of VC deals corporates investors have been involved in (down 1%) and in their share of over all investment dollars (down 1.4%).

It’s biggest problem will then be convincing entrepreneurs that it is worthwhile to have Google invest in them. There will have to be something that makes Google the most advantageous backer i.e. brand name and technical resources.

A VC arm could allow Google to venture into other markets, creating new software and gaining new talent but to do so is risky and fraught with challenges. All the same, if you are looking for a VC investor I think Google would be an interesting backer. I like their innovative approach and their creative openness. What do you think are the problems or benefits?

Tags: , google, Google Venture capital, VC

This entry was posted on Monday, August 4th, 2008 at 11:21 am and is filed under Uncategorized. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.