Google Ventures, corporate venture capital investment arm of Alphabet Inc, has decided to move away from investing seed stage investing, says Bill Maris, President and CEO of the Venture Firm. Google Ventures (to be renamed GV this week) is entering 2016 with $2.4 billion under management.
Without discussing the exact number of deals, Maris said, Caliornia-based firm did fewer deals in the range of $100,000 to $300,000 this year. Going forward it will be providing only venture, and growth stage funding to technology companies.
The reason behind this is because the firm is urging its established portfolio companies to go public. It has now shifted its attention to more mature companies which are more ready to go for a listing. “I’m seeing actual companies that are, for reasons that are hard for me to understand, resisting to go public with all they’ve got,” Maris said in an interview with WSJ.
Besides growth stage startups, the company is also going to have an increased focus on biotech and life science technology firms. In 2015, GV invested 24% of its fund in consumer centric startups, a jump from 8% in 2014. The company doesn’t admit this to be strategic, but it already does have high valued enterprise companies like Slack (valued at close to $3 billion), DocuSign (~$3 billion valuation) and Cloudera (~$5 billion valuation) in its portfolio.
Although seed stage investment presents a greater return opportunity, it involves a high risk, and for multi stage investment firms, managing different companies at different stages becomes tricky. Technology companies like Uber and Airbnb which are ahead in the technology investments space are also not showing signs of going public as they continue to raise money. On one hand VC firms like GV are getting impatient, on the other VCs like Marc Andreessen are happy with their portfolio companies staying private. Should founders stay cautious and list when they feel its required, or should they take the investors advice on when to go public?