The seed funding arm of Alphabet Inc, Google Ventures is doing away with its $125 million European fund, it launched 18 months back and having a single global fund for all investments. According to CEO Bill Maris, it will give the company a greater flexibility to invest.
He also announced the rebranding of the firm to GV in order to avoid the conflicts and accusations on the company for being a “secret cloak-and-dagger unit of Google”.
There is not a single case that supports that mythology. The company gets no information from us, we’re a shareholder just like any other. My interests are aligned with entrepreneurs and the other shareholders and not Google.
Google Venture is one of the leading investors in Silicon Valley having invested in more than 300 companies including Uber, Nest, Pocket, Slack, DocuSign and CloudEra to name a few. There was much hype around its $125 million European fund, which it set 18 months back to invest in companies across Europe.
However, the fund never met the hype and expectations amidst the rumors of disagreement among team members especially after Peter Reed, one of the investment partners, walked away without any explanation.
The fund only invested in 6 companies, 5 out of which were located in the UK itself namely Kobalt, Lost My Name, Yieldify, the Oxford Science Innovation Fund and Secret Escapes. The 6th company was Sweden-based VR gaming studio Resolution Games, but it was rumoured that that investment was made out of US funds.
However, Maris has denied that the European fund was a disappointment and the investment pace was pretty much in line with its US wing despite not meeting its targets “dollar for dollar”.
Although apart from the European fund, the overall ride for Google Ventures this year has not been smooth. The company invested 20% less than the last year and the number of companies also fell to 34 investments as compared to 57 investments last year.
Explaining the same, Maris said,
The amount of money trying to get into investments has caused prices to go up and negotiating leverage to move to the entrepreneurs.
He further added that the capital was never a constraint for them and signs that private market valuations were starting to fall in some cases made it likely that the pace of investments would pick up again next year.