Google.org, Google's philanthropic venture, has started stating its ambitions and placing some of its $2 billion in funding. In keeping with the search giant's style, the initial investments are low and the ambitions are global.
Google.org's five "core initiatives" over the next five to 10 years include identifying infectious diseases and droughts early in their spread; getting information on essential public services to poor populations in developing nations; promoting growth of small- and medium-sized enterprises in the developing world.
Two earlier initiatives, fostering renewable electricity generation at a price cheaper than coal-fired power and promotion of electric vehicles (presumably powered by renewable power) were announced in November .
The initiatives represent a mix of concerns shared by key Google executives and tries to exploit the technical skills the company believes can give it particular impact. "We are trying to rely on things related to Google's core competency, where we can really make a difference," says Sheryl Sandberg, a Google vice president and founding board member of Google.org. "We wanted ideas where we could say, 'If we get this right, it will change the world.' "
The first grants, which amount to approximately $25 million, will not shift the planet or even put a dent in Google.org's grubstake. Five million dollars is going to an organization called InSTEDD (for Innovative Support to Emergencies, Diseases and Disasters), which looks for gaps in information flow among relief and response organizations. Another $2 million has been given to a nongovernmental organization in India called Pratham, which conducts large-scale assessments on the delivery and quality of education to the poor.
There were numerous smaller grants announced in both the disease mapping and social services initiatives, but no investments yet in small businesses or electric vehicles. In November, Google.org announced a $10 million investment in eSolar, a Pasadena, Calif., company working on thermal power from sunlight.
Sandberg and Google.org head Larry Brilliant drew on people they knew from their earlier lives (at, respectively, global health and the U.S. Treasury) to head the corporation's big initiatives.
The push to increase small and medium-sized business in the developing world is headed by Sonal Shah, who came to Google after stints at Goldman Sachs, and earlier in the U.S. Treasury Department, working on development in sub-Saharan Africa, as well as at start-ups in environmental and alternative energy businesses.
"Fifty percent of the gross domestic product in the developed world comes from small and medium-sized businesses, but in the developing world it's just 25%," Shah notes. "We've already met with financial institutions in Kenya, Tanzania and India that want to lend but don't have the tools. We want to lower the transaction costs, find new ways of establishing credit history and create opportunities for exit rounds."
Mark Smolinski, in charge of predicting and preventing disease and drought, knew Brilliant while he was at the Center for Disease Control, and more recently ran research in biological weapons programs at Ted Turner's Nuclear Threat Initiative. That job involved building regional disease surveillance systems in the Mideast, something he now hopes can be built on a global scale. Google, he says, "can build technology to fill information gaps between health ministries, nongovernmental organizations and the private sector."
There have been almost 40 new communicable diseases identified in the last 30 years, he notes, and more will likely arise as a growing world population brings people in closer contact with each other and disease-bearing animals. "Our biggest threat, though, is the lack of an adequate public health workforce," Smolinski says. "Without that, we'll never be able to handle a disease outbreak, so we're very interested in developing that."
Dan W. Reicher, the director of climate change and energy at Google.org, knew Sandberg during the Clinton administration, when he directed $1 billion a year in alternative energy programs at the U.S. Department of Energy. He will probably spend the big bucks at Google.org, too, since his brief involves financing projects between the levels "between the pilot level and a big commercial roll out," where private equity often balks.
"We're talking hundreds of millions, that's what it's going to take," Reicher says. The most promising initiatives near term, he thinks, include solar thermal, high-altitude wind power and deep drilling to tap geothermal power. "We're hiring scientists and deploying capital soon," he says, "with world energy consumption going up so fast, the percent being spent on non-hydro alternatives to fossil fuels is actually going down."
Lant Pritchett, a lecturer in public policy at Harvard, sees his work consulting for Google.org's initiative to better inform and empower poor people in developing nations as "a thin end of the wedge" that will improve the way money already allocated for the poor is spent. "In India, Pratham (an organization Google.org is funding) tested fifth graders on whether they could read. In some places, the kids couldn't even hold the letters up correctly." Since then, he says, the effort has become a national issue, with principals held accountable for their performance.
Google shunned nonprofit status as too restrictive for its philanthropic aims, instead choosing to make both grants and for-profit investments. Each initiative has a director and small staff, but individual budgets are not fixed and may vary widely. Google.org wants competition for ideas and projects, and like Google's core businesses, plans to make future moves based on feedback from earlier investments. In addition, Google.org expects to spend relatively little to promote social services or small business, both of which are geared to more efficiently utilize existing capital and services. Projects like power generation, on the other hand, may cost hundreds of millions of dollars, since Google.org will endeavor to prove engineering concepts by building out power plants.
Executives expect a certain amount of ridicule for their unconventional and risky approach to problem-solving. "A lot (of the initiatives) could fail," says Brilliant. "They are risky and unconventional." They are also designed to break down "false choices," he says, between trade and aid.
Sound cocky? "Of course, you could call us arrogant--it's Google," says one official. "But we're motivated to think big."
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