Google Ventures, the investment arm of Google, has not had a stellar year. 2015 showed a 20 percent slump in their total investment output over 2014, though earnings have seen a definite upswing. That number is saying something, since Google Ventures, soon to be renamed GV, has a total portfolio under 400. The fact that this is enough to put them near the top of the heap in the area of Silicon Valley investors speaks volumes about the state of the market with startups and investors. Roughly $300 million of GV's current capital and a planned increase of $500 million have yet to see any action.
GV's adventures in earmarking fund pools for individual regions saw a hasty end with what seemed to be a severely underutilized fund for Europe. Only six draws were made from the $125 million fund in 2015. Interestingly, GV's chief Executive Bill Maris says that the Europe fund was satisfactorily utilized. According to him, putting the kibosh on separate funds to gather all the capital into one global pool is merely a move in favor of flexibility, allowing precise control over the entirety of GV's responsibilities.
Maris also weighed in on GV's name change, saying that Google Ventures as a name implied too heavily that GV, a separate company whose interests lie with shareholders, leaving Google calling just as many of the shots as any other shareholder. There had been allegations that GV was secretly an acquisition pipeline for Google, checking out new talent and startups for any that may make good additions to Google's camp. Maris sounded off on this issue as well, saying, "The minute that happens we're done â€” that's the end of the business,".
GV has had a bit of trouble with conflict of interest claims and competition as well. Uber, one of the businesses that GV backs, could be considered direct competition for a proposed taxi service starring Google's self-driving cars. GV's recent interest in life sciences and the medical field also puts it at odds with an arm of Alphabet, specifically one called Calico, run by former Genetech exec Art Levinson. GV has thrown in their hat to the tune of $100 million a year in the life sciences space, to be divvied up among the three best ideas they can find. Though this puts GV in a wrestling match with Calico, Maris does not discuss ideas with Levinson.
Overall, it's not hard to see why GV had such a rough year, especially since the market has been turned on its head in recent years. Entrepreneurs have gained increasing traction in investment decisions and startups have been popping up seemingly every day, leaving questions of valuation and capital worthiness swaying in the breeze. GV looks poised to pull itself out of its slump in 2016 as capital is better controlled and sees an increase, but only time will tell for certain.