Making Sense Of Google Developing A VC Arm

There’s no reason why Google should be developing a VC arm at this point in time.

Google is revisiting efforts to create a venture capital arm, according to a report on The Wall Street Journal‘s Web site Wednesday night.

Google senior VP 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, 33, to help set up the
venture, the newspaper reported.

At least from a financial or strategic perspective.  Google is one of only a handful of companies that provide an exit for internet startups.  They are the market and they already implicitly dictate where the venture dollars flow. 

However, it does make sense if they feel that their practice of buying small companies they like is NOT the best way to buy and incubate early ideas.  Remember Dodgeball?

But with Google, nobody really knows… I wouldn’t be surprised if they came out and said that they’ll use this vehicle to invest in clean tech deals.

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