Google’s second investment arm, Google Capital, just announced its fourth investment.
Auction.com got $50 million at a $1.2 billion valuation, following $40 million for Renaissance Learning at a $1 billion valuation. Last year, Google Capital participated in a $125 million secondary transaction for Lending Club valuing the company at $1.55 billion (it’s gone up since then), and a $444 million equity round for SurveyMonkey valuing that company at $1.35 billion.
Just spelling it out by category, that’s real estate, education, finance and measurement. It’s also a tendency by the new “growth equity” fund toward companies that could be described as later stage and lesser known.
Google Capital partner David Lawee told Re/code yesterday, “We are finding companies that are in big segments that can be huge. If it turns out it’s lesser well-known, it’s easier from an investing point, but that’s not our thesis.”
So what’s a good company for Google Capital? “Later stage” can be generally defined as a revenue run-rate of $10 million, said Lawee, who was formerly head of Google’s corporate development arm, leading acquisitions of companies large and small.
How Google Capital is different from Google’s other investment arm, Google Ventures, is not entirely clear, especially given that Ventures put $250 million into Uber at a $3.5 billion valuation.
“We have the same philosophy but we’re servicing a different constituent, more mature companies,” Lawee said.
It’s true that Uber is the youngest company of this bunch, having been founded in 2009. Auction.com was founded in 2008.
Way out there on the geezer end of the tech company spectrum, Renaissance Learning got its start in 1984 and was formerly publicly traded.
With $300 million to invest in 2014 and a goal of five or six deals this year, Google Capital is “a team of 8 people, very much a startup, with aspirations to be truly world class at bringing operational excellence from 40,000 Googlers,” Lawee said.
That’s as compared to some other professional investors, who in Lawee’s view end up being middlemen for practical advice.
For instance, Lawee said, Google Capital plans to connect Auction.com with Google’s online marketing experts. “I ran marketing for Google — five years ago — but I’m not an expert on marketing anymore. Only those people can really help.”
“We want to be more than a soundbite,” Lawee said.
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