Two renowned American newspapers have recently reported that Google Ventures is on a “bumpy ride” after it had reduced its involvement in seed-stage startups. Bill Maris, President and CEO of Google’s venture capital arm that draws capital from Alphabet Inc., commented that the company was “moving away from seed-stage investing” citing “less opportunity” as the market is overheated. Moreover, Google Ventures is also ditching its Europe-specific fund altogether. The European branch of Google Ventures was launched about 18 months ago and had an initial $100 million to allocate. It marked the first time the fund stepped outside the United States.
Bill Marris then commented that “We believe Europe’s startup scene has enormous potential. We’ve seen compelling new companies emerge from places like London, Paris, Berlin, the Nordic region and beyond”. However, since then, the company has made only six investments on the old continent out of which five were in the United Kingdom (Kobalt, Lost My Name, Yieldify, the Oxford Science Innovation Fund and Secret Escapes). The last investment was made in the Sweden-based VR gaming studio Resolution Games, but it was seemingly made from its US fund. Therefore, Google Ventures ‘Europe’ has technically never made an investment outside of the UK.
Mr Maris commented that the European branch of the fund had not “disappointed” but he admitted that the investment pace was overall in line with its US wing although it was not meeting its targets “dollar for dollar”. From now on, any European investments will be made from the global Google Ventures Fund. In the meantime, Google recently established a brand new €150 million ‘innovation fund’ to boost digital news projects across Europe. European VCs are raising finance almost every week to double down on investment opportunities across the continent.