So what does Google get out of Google Ventures?

On the one hand, financial return is the objective. That’s how we get measured, but there are many unintended consequences that Google benefits from. Hundreds of startup founders who have reason to talk to people at Google, build relationships. Those companies have stronger relationships with Google as a result of our investment than if they didn’t. That gives Googlers and engineers a reason to say “I want to work on an interesting product in my 20% time“. Well, here are 300 companies to choose from that have already been vetted. That’s one kind of benefit.

Another is participation in the startup ecosystem, being part of the lifecycle. Google was a venture funded company. Being part of that brings an energy to the company.

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More than one third of the money Google Ventures invested last year went into life-sciences companies. Can you explain the over-arching investment thesis behind that? 

This is the “transistor moment” for life sciences. By that I mean, what the transistor enabled for computation resulting so far in this [pointing to his mobile phone]… that’s very similar to what’s happening in life sciences. The sequencing of the human genome started in 1991, ended in 2004. We didn’t have much hope of curing cancer before you could sequence the genome. We’ve been at it for 15 years and people say “Oh, cancer, we are making no progress.” Give it some time!

Now is the moment where change is going to happen at such a pace it will be as unpredictable as this was [points to the mobile phone again]. In 1970, you could imagine people could talk to each other… but you wouldn’t imagine Instagram—there’s like several layers deep you have to go to imagine [that]. So things are going to happen in the life sciences that are more important [than in consumer tech] because it means people will suffer less and die less.

This coming wave that’s about to happen [in life sciences] is under-appreciated. It’s not as attractive to talk about, it’s harder to understand, to communicate to people, it’s not as celebrated in a lot of ways.

What are the other themes that influence how you apply capital in the portfolio ?

One, we care a lot about [the founders] we are investing in. The extent we can understand their motivations and their values—you don’t always get it right but you try. That’s really important because you are building a relationship that will last often for years. You want to work with people you are excited about and they are excited about you. It’s a two-way street.

When you think we have 300 companies, with tens of thousands of employees, we have a real opportunity to share our values with those companies, not just corporate values, but transparency and how to treat people. Just this past week if you asked me about our top 25 investments, what percentage of those boards are female, if you said 10% you would be off by a factor of two. It’s 4%. So that’s an opportunity.

I look at our investment team, we have two female partners out of 15, we have an offer out to a third… and that’s really kind of egregious. It’s sad. So I look at our own team, and to our portfolio and it’s a chance to say to them, “We can do better than this.”

You recently invested in Kobalt, a fascinating company, but one that doesn’t seem to fit the profile of what you would invest in.

I actually think it fits perfectly in what we want to invest in. It’s a disruptive company changing the nature of an old stodgy industry [music publishing]. Willard [Ahdritz, Kobalt’s CEO] is a very dynamic, engaging CEO, he describes himself as a crazy Viking. He is part of that interesting group of Swedes in the music business.

I also happen to be married to a professional touring musician, a singer-songwriter… and I discovered how messed up the music business is. Is it even a business? In what other industry can you provide a product, get no information on who bought it, how many times it sold, and then a year later get a cheque with no explanation? I think there is a lot of corruption in that payment chain. Kobalt wants to bring transparency to that.

Kobalt was your first international investment. Are there more plans to invest offshore and where? In Asia? 

In the very near future we will have some more [investments] in Europe. Right now our focus is the US, Europe, Israel. Its important to have some people there locally; we don’t have anyone in Asia right now. But it’s not a part of the world we intend to ignore. It’s just a matter of, “Just give me a little time!”

The great thing about the world today is that there is innovation everywhere. [Spotify CEO] Daniel Ek has built a really important company not based in the US, not based in London [but in Sweden]. So there’s a lot of opportunities and we would be foolish to think they will come to us and we don’t have to look hard.

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