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The Wall Street Journal has reported that Google is flexing its muscles to launch a venture fund; giving Google a chance to invest in startups. Something pretty un-Google, since the giant has been up at buying them out, flat. The fund is set to be led by Google’s SVP Corporate Development David Drummond and Bill Maris.

Google had toyed with the idea before, however the bubble burst before it could be blown enough. The current step; if falls at the right place as planned would help Google’s reputation being transformed from the direct buyer to someone that invests in companies to rise from the ground. A part of the article published in WSJ is given below:

The move would make Google the latest technology giant to take on a more-formal role in seeding start-ups. Intel Corp. has had a large venture-capital arm for years, as have Motorola Inc., Comcast Corp. and many others. In the consumer-Internet area, Walt Disney Co.’s Steamboat Ventures has invested in a number of Web start-ups. So has Amazon.com Inc., which has funded a number of young companies without structuring a formal fund.

Their track records have been mixed. Corporate venture-capital arms have been hampered by challenges that traditional venture-capital businesses don’t face. Venture capitalists invest in private start-ups at an early stage, usually in hopes of a big payout if the company is sold or if its stock goes public.

The call makes away amidst a low turn out for the venture capital investing; with around 12% drop in the second quarter. The present investments report of having about $1.6 billion sunk into the startups that seek first time funding. Plus those that had later deals went up to fetch $3.1 billion.

An interesting factor here is that there has been no venture backed firm that has gone public in the second quarter. And given the analysis, start-ups have their own set of fears when it comes to getting investments from corporate giants. The fear of loosing other investors and more importantly dimming out the rights to buy the company at a later stage always stir the start-ups. Google needs to plan things at putting the money in the right place and in quality and not just emphasize on pure acquisitions. Does Google even know the difference between ‘investment’ and ‘acquisition’? I hope the giant does, or maybe it thinks of investment to be just another name for a buy out. Just an opinion.