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Continuing its venture evolution, Google is announcing today a new venture capital arm — Google Ventures — aimed at adding profits to Google’s portfolio.  It already has two ventures (source: NYTimes) that relate to potential future core businesses: “Silver Spring Networks, a company that makes technology to help manage electric grids, and Pixazza, which links online images with related products that can be purchased. Google declined to say how much it invested in those companies.”  It is reported that Google Ventures will invest $100 million over the next 12 months.

With Google having brought a new sophistication and efficiency to managing the world’s information, it seems fitting that they could diversify toward managing an emerging re-engineered and sophisticated electrical grid. 15 years from now, will Google be known for information search, advertising networks, SaaS applications, grid computing, and energy (green technology, energy network management,…)? It would seem so. (Just don’t hire the Enron folks.)  With this view, it sure makes GOOG look cheap. Nice strategic growth move, Google.

A word from the source:

What is the focus of the fund?
Google Ventures is broadly interested in startups in industries including consumer Internet, software, hardware, clean-tech, bio-tech, health care and others. First and foremost, we’re looking for entrepreneurs who are tackling problems in creative and innovative ways. As a venture fund, however, we’re also looking for investments with the potential for significant financial return.

Update:

A note about Google Ventures on the Google Blog:

At its core, Google Ventures is charged with finding and helping to develop exceptional start-ups. We’ll be focusing on early stage investments across a diverse range of industries, including consumer Internet, software, clean-tech, bio-tech, health care and, no doubt, other areas we haven’t thought of yet.

It felt like I was missing something in my list above — Health Care/Life Sciences. Google already has a health initiative, and I can’t help wonder if they will invest in or buy companies like QSII or MDRX (disclaimer: I own shares of each, and GOOG).