Just a few days ago, Google revealed that it was opening a massive space in San Fransisco for startup companies to work, collaborate, and attend a number of events. Along with this effort, it appears Google has other plans for investing in startups. According to Recode, Google has quietly been investing in startup companies from former employees of the company…
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Multiple sources are apparently reporting that Google has recently been funding several early startups such as Hello, a new social network formed by the creator behind Orkut. That former Google-owned social network has been shut down for quite some time and seeing that Google+ is pretty established, this investment probably doesn’t have bigger implications for Google’s social plan.
The funds for these investments are apparently coming directly from Google, not Google Capital or Google Ventuers, and are being paid in the form of convertible notes. Sources also claim that the investments don’t grant Google first chance at a future acquisition of that company, and they also weigh in at less than $10 million. Recode further reports that Google has been making these investments over the past couple of years.
It’s unclear exactly why Google is investing in these startups, but it seems pretty clear that the goal isn’t to eventually acquire the companies. Rather, Recode suggests that Google is simply trying to keep former engineers close and spread its reach in Silicon Valley at the same time.