Tuesday, September 04, 2007

BusinessWeek: Google's Newest Role: Venture Capitalist

"Google (GOOG) has begun making VC-style investments to the tune of about $500,000 or less in promising startups, often buying those companies afterward, according to partners at Silicon Valley VC firms who spoke on condition of anonymity. In an effort to keep spotting promising deals, Google has been hiring a stable of finance pros. And it has invested more than $1 million in a Mumbai-based investment firm called Seedfund to gain access to technology such as automatic translation software that could help spur growth in India.
"Google has easy money," says Pravin Gandhi, a managing partner at Seedfund, which also has raised some of its $15 million from Motorola (MOT) and VC firm Mayfield Fund. So far, Seedfund has taken $500,000 to $750,000 stakes in four companies, including an online news site. On the horizon could be investments that help Google add specialized channels, such as information about autos, to its Web site or cultivate technology that can translate Web content from English into Indian languages, Gandhi says. "It's a somewhat less risky way to participate in the Indian growth story," he says. "

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