Google Ventures (GV) began operating in 2009 under Alphabet, Inc., which is the parent company of Google, the dominant search engine. The aim of Google Ventures is to provide funding for various startup companies that have a technological focus, either in the creation of new technologies, or those that develop technologies for the purpose of improving current processes. GV tends to invest in companies that it sees as having positive social value, so the firm does not simply focus on technology; rather, the firm aims to identify startup companies that seek to use technology in a socially responsible way. According to the Google Ventures site, the areas that GV focuses on include life sciences, health care, application of artificial intelligence, agriculture, robotics, cybersecurity, and transportation (Google Ventures, 2018). A few of the most recognizable companies partnered with GV include Uber, the transportation service; 23 and Me, which is a gene-mapping service; and DocuSign, which pioneered the way electronic signatures can be collected and verified.
As a venture capital firm, GV operates under the basic venture capital formula: it identifies startup companies that are deemed promising, and it invests in these companies with the goal of gaining a return if the company proves successful. Because Google operates in the technology field, it seeks to identify companies with a technology focus. Additionally, Google has traditionally operated with the ethos of social responsibility, so it looks for companies with similar ethical standards. Thus, GV is able to financially reward itself for investments, while at the same time promoting other companies that seek to contribute to the social good.
GV has numerous advantages that help make itself, and the companies in which it invests, successful. First, Google Ventures’ alignment with Google and Alphabet, Inc., give it high visibility. Alphabet, Inc., is a highly successful company and has numerous resources it can provide. This would make any startup company seeking investors want to partner with Google Ventures, so GV essentially has its choice of nearly any startup it would like to work with in return.
Second, Google Ventures bring with it the technological prowess of Google. Although Google originally began as a search engine, it has evolved over time to other forms of software and hardware. Google Maps, Android OS, Gmail, Google Cloud Storage, Google Smartphones, and numerous other ubiquitous products and services are just a few areas where Google has focused on in the past (Carlson, 2014). Google is also actively working in health care, such as providing technology that can be used for imaging, as well as in areas of artificial intelligence. As the venture capital extension of Alphabet, Inc., Google Ventures brings expertise from all these areas when supporting a startup company, depending on the central technological need.
Because of its experience in so many different technological fields, Google Ventures can support its startups much more than simply providing cash, and hoping the cash is used to make sound investments. Rather, Google Ventures can provide a host of innovative technologies that can be used to help numerous aspects of the startup company’s needs: it can help with research and development, by sharing information it has also gained; it can help with production by helping design product specifications, some of which may need to be constructed with digital models that Google software can create; it can help with any technological infrastructure needs the startup may have through the design of various apps, such as an app that a company like Uber might need for its customers; it can help facilitate internal communications within the startup by providing communication software as well as cybersecurity measures needed to protect potentially sensitive information; and when the time comes to market a product or service, GV has access to the most used search engine in the world, where it can also strategically place advertisements through targeted marketing.
Google has also identified how to optimize online advertisements with its AdSense services, which relies on unique algorithms to supply targeted ads based on user interests. AdSense extends beyond the basic search engine Google provides, so these ads will appear on numerous other pages, including any web page that has been designed to include ads, as well as through various platforms such as YouTube, which Google also owns. Thus, GV can advertise its health care partners directly to the health care community, or it can conduct a campaign for the general public for a transportation service like Uber, depending on the need. In this way, GV can provide consistent support for its startup companies, from inception to promotion, while helping develop and design the product along the way. The resources provided by Google are for all practical purposes endless, so Google Ventures does not also place itself at financial risk with a failed startup, because its size allows it to absorb losses, making it more able to take risks.
The team at GV consists of multidisciplinary experts, so it is not limited simply to having business expertise. GV can also provide engineers, programmers, designers, doctors, and other scientists, as well as those who have business expertise. Thus, GV aims to provide holistic support for its partner startups, rather than simply injecting cash into a project it finds promising. The advantage of GV is not only its sheer size and public visibility, but also the amount of resources, including human resources, it can provide a company. Because Google works with experts within numerous technological industries, these experts can provide extensive knowledge gained from experience to help develop products and services that will promote the responsible use of technology.
- Carlson, N. (2014). A list of products Larry Page has Google working on other than search, such as spoons. Business Insider. Accessible online at http://www.businessinsider.com/a-list-of-google-products-2014-9
- Google Ventures. (2018). Official site. Accessible online at http://www.gv.com