Google developing a venture capital arm
Published: 31 Jul 2008 08:37 BST
Google is revisiting efforts to create a venture capital arm, according to a report on The Wall Street Journal's website on Wednesday.
Google senior vice president David Drummond is expected to lead the effort, according to people who were briefed on the discussions. The group has also hired former entrepreneur William Maris to help set up the venture, the newspaper reported.
The search engine has played with the idea before, and the plans could still fall through.
If successful, the new venture would put Google — a company better known for buying companies than investing in them — in the more-formal role of helping get start-ups off the ground. Other Silicon Valley companies with extensive venture-capital track records include Intel, HP and Motorola, among others.
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The move comes at a tough time for overall venture capital investing. A report from Dow Jones VentureSource earlier this month stated that venture-capital investments dropped 12 percent in the second quarter compared with the same period a year ago, with $6.64bn (£3.35bn) put into 602 deals — the lowest quarterly deal count in three years.
More venture firms found themselves funnelling money to support later-stage companies at the expense of companies seeking first-time funding. The amount of money sunk into start-ups seeking first-round funds dropped by 12 percent to $1.6bn in the second quarter.
Meanwhile, later-stage deals grew by 14 percent to $3.1bn, because those companies in particular had fewer opportunities to go public. No venture-backed company went public in the second quarter.
Credit: Report: Google developing VC arm from CNET News
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