GV: The VC Team Backed by Google Has a Broad Rethink Remit, But Can’t Do Everything

The Autonomy of GV: How Google’s Venture Firm Operates with Unparalleled Freedom

David Krane, the CEO of GV, is in a unique position. As the venture firm funded entirely by Google to the tune of $1 billion per year, his team of roughly 100 has the freedom to make a multitude of bets, subject only to a few notable restrictions.

A Staggering Investment Track Record

During a recent TechCrunch StrictlyVC event in San Francisco, Krane revealed that GV has made an astonishing 800 investments over the last five years. Moreover, the firm has shelled out more than $10 billion across its 15-year history. Notably, no single investment has received as much funding as Uber’s Series C round, which was a whopping $258 million in 2013, funded solely by GV.

However, despite this significant investment, GV still makes large bets at times. For instance, the firm plugged $140 million into data infrastructure startup Cribl in August as part of a $319 million Series E round. This highlights the firm’s willingness to invest substantial amounts in promising companies.

A Purely Financial Focus

Krane emphasizes that GV invests solely for financial returns. As such, there are few limitations on how the firm can operate. To date, this has meant that GV has primarily invested in the U.S., with roughly half a billion dollars invested in its second-biggest market, Europe.

Splitting Time between Life Sciences and Digital Ventures

The autonomy afforded to GV has also allowed the firm to divide its time equally between life sciences, healthcare, and biotech, and an all-encompassing ‘digital’ category. This breadth of focus enables GV to explore a wide range of opportunities across various sectors.

No Red Lines with CapitalG

One might assume that GV’s relationship with Alphabet’s growth-stage outfit, CapitalG, would lead to some degree of restriction or overlap in their investment strategies. However, Krane assures that because both groups are funded by the same source (Google), they have a strong foundation for communication and collaboration.

Avoiding Conflicts of Interest

When asked if GV and CapitalG ever engage in competition for investments or larger stakes in companies, Krane dismisses the notion, stating that effective communication is key to their partnership. Indeed, one of the only apparent no-nos for GV is actively enticing talent within Google to start a company so that GV can be the first to fund it.

The NotebooksLM Example

During our conversation with Krane, we mentioned the recent news about members of Google’s AI-driven note-taking tool NotebookLM leaving to start their own company. When asked if GV might fund them, Krane revealed that GV is aware of some team members and had knowledge of the potential startup before its inception.

While GV does occasionally invest in teams leaving Google, Krane clarified that there hasn’t been a deliberate effort to create a ‘sucking vacuum’ that encourages people to leave Alphabet and pursue startups. However, he acknowledged that many talented individuals from Google’s ecosystem do go on to start their own companies, which GV is happy to support.

The Freedom to Invest

In conclusion, GV’s unique relationship with Google affords the firm an unparalleled level of autonomy in its investment strategies. With a purely financial focus and a broad range of sectors to explore, GV continues to make significant investments in promising startups. While some may assume that GV’s connection to Alphabet would lead to restrictions or conflicts of interest, Krane assures that effective communication and collaboration are key to their partnership with CapitalG.

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