No further details on the structure or purpose of the venture effort were immediately available. Google spokesman Andrew Pederson says the company “does not comment on market rumor or speculation.”
A move into venture capital would be strange for the search company, especially after Google CEO Eric Schmidt openly derided the VC-oriented outreach programs run by other large corporations, such as Microsoft and IBM as recently as two years ago.
Most corporate outreach programs and VC arms are designed to make it easy for startups to develop applications for their platforms, as large tech companies recognize that the bottom line is tied to the success of smaller companies that utilize their infrastructure offerings.
A PE Week reporter asked Schmidt about Microsoft’s VC efforts at Princeton University alumni event in 2006. “My impression was that the Microsoft program didn’t work too well—by no fault of Dan’l [Lewin, who headed Microsoft’s VC outreach program at the time]. It’s the company,” Schmidt said at that time.
In lieu of a formal venture program, Schmidt said Google would be open about its new projects and strategic direction. “We’re trying to tell everyone exactly what we’re doing, whereas Microsoft adopted their program after they convinced everyone else that they couldn’t compete [against them],” he told the PE Week reporter. —Alexander Haislip