Bill Maris has had an eclectic career. He studied neuroscience and Shakespeare in college, started his career as a portfolio manager picking biotech investments and got smitten by the idea of entrepreneurship during the internet boom. His startup went through hell after the dotcom crash but Maris survived and eventually sold the firm before rebooting his life. After taking a two-year break with a social project that involved a novel hydrophobic acrylic lens for cataract surgery, his career took an unexpected twist at Susan’s. Google founders Larry Page and Sergey Brin had first set up shop at Susan Wojcicki’s garage, and Maris being Susan’s friend happened to connect with them and the rest as they say is history.
In his second innings, Maris as president and managing partner of Google Ventures has built a formidable team and so far has poured $2 billion into about 300 fledglings that include Uber, which is also its biggest investment. Maris is personally both passionate and bullish about life sciences and in recent times famously said, “Today, it’s possible to live to be 500.” While that statement is more headline grabbing, his larger point is about how life sciences today is at the cusp of helping to slow or reverse ageing, fight disease and elongate our lifespan.
Google Ventures is relatively new in the business. Is there an edge that it has as opposed to other venture capitalists on Sand Hill Road?
You are looking at the edge (grins). I set up and designed the firm to have advantages. First the people — we wanted to hire entrepreneurs, people with deep technical backgrounds who were experts in certain areas be it sciences, materials science, agriculture, machine learning and artificial intelligence. But they also need to be really great people whom you enjoy working with, who create a good culture, who foster collaboration and who have the experience as entrepreneurs. If an entrepreneur is making a pitch to me, it is really important that I have been in that seat. I should have empathy for what your experience is like. That is one piece of it. And then, coming out of Google, we had to create structural elements to give ourselves as many advantages as possible.
First, of course, we said we will hire whoever we want — free of any interference from Google. Second, we get paid like venture capitalists, that is, get a percentage of the profit. If we are great investors, we will really do well financially, and if we are not, we won’t get paid that much. Third, our investments have to be untouchable by Google. Google can’t push something on us. It can’t be that they want to sell a product, so we invest in that ecosystem. Our interests are aligned with that of the entrepreneurs, not Larry and Sergey.
We launched the fund in 2008 when the market was at a real low and banks were failing. But Google didn’t blink. When everyone was cowering under the table, it was the right time to look for opportunities. I started hiring people. Rich Miner, who co-founded Android, David Krane, a longtime Googler, Joe Kraus and Graham Spencer, who co-founded Excite and a whole bunch of other smart people. When you surround yourself with very smart people they tend to do really great things.
Corporate ventures were always set up so that the big company would invest in little companies with the hope that those little companies could help them in some way. We tried to reverse that to say here is this big company Google that is very lucky. It has lots of resources, people and all kinds of opportunities. What can that do for small companies, startups and entrepreneurs? So, we very mindfully named it Google Ventures, thinking let’s unlock everything we can at Google for startups.
Can you elaborate on the last bit?
Let me give you an example. Our second investment was in a biotech company called Adimab, which had a novel method of generating protein-based drugs and was built by a very distinguished professor of bioengineering, Tillman Gerngross who sold his first company for $400 million, and had started a second one. One of the projects Adimab was working on involved protein design in the cloud which is a very computationally intensive operation. Back then in 2008, Amazon’s web services and Google’s cloud operations weren’t very mature, so to get time on the cloud in a multiprocessor array was expensive and limited. So, we introduced them to the person at Google whose job was to figure out ways of productively utilising the fleet of servers Google had. Processors are like phones — they are mostly just resting, and that’s kind a waste of resources.
Close to the heart
A chunk of Google Ventures' investments are in the healthcare vertical
When I introduced Adimab to Google, they said, “What if I could offer to you a million hours of time in the cloud?” The guys from Adimab were blown away and that was the very start of what became the Google compute engine and Google’s cloud offering. It helps Google a lot and it also helps the startups. For each of the 300 companies in our portfolio there are a dozen stories like these.
When you have a 50,000-person company with the kind of global resources Google has, people find ways to work together in unpredictable ways. When we invested in Adimab we did not predict that they would have this huge compute problem, or that Google had a resource to offer them, or that they would agree to work together. But that has played out, over and over now.
What kind of equation does Google Ventures share with Google?
Google has never violated the tenets that we have and has never tried to interfere in an investment. Neither do they push any investment on us, nor do they interfere with the way the team gets compensated. We are lucky to have that kind of long term vision not just on our team but from your investor, your limited partner who is willing to take a huge risk with a lot of money and leave a smoking crater on the ground. We are trying to get to the moon, but the rocket ship could blow up. Everyone being okay with that and the flexibility we have is a huge advantage in this business. The fund size is whatever we invest that year. It is not like “Here is $300 million, you have to invest it.” A year could go by with no good deals and no one would ever say anything to us.
Other edge is the team we have built. I asked myself and our team, “When we were entrepreneurs what did we need help with? Let’s build teams to help companies with those problems.” So, we built a team of designers, user experience engineers, people that had built products — big products that billions of people use such as Gmail. The design teams go into companies for days and weeks to help them redesign their products, their processes, help them understand how users use their websites or the products themselves. I think we have some of the best people in the world there.
In 1997, you couldn’t find many people who built a product that a billion people use everyday as there were only 50 million people on the internet. Today, there are three billion people on the internet. There are not that many products that a billion people use a day, but Gmail and Google search are some of those products. Our team is built around people like that who have done really significant things. Having this team is a huge advantage because any venture fund can go out and hire a designer-in-residence or an engineer. But to build teams and run teams that have actually done these things and worked with each other before is a strength that is unique to Google Ventures.
Unlike other VC firms, we hire technical talent because we come from Google. Our recruiters will hire the first engineer who can help hire the next engineer. Then we have a partnerships group to bring together our startups with larger companies. People think of Fortune 500 companies as lumbering giants that can’t get out of their own way, but there is a surprising amount of enthusiasm from Fortune 500 companies to meet with startups. For example, if Wal-Mart comes in and says “We are looking for technology in the mobile space”, we will bring our startups. Ditto for Caterpillar or Airbus or whomever comes in. We think maybe there is a business relationship that can happen there. It is not a way to get them to buy a company. Sometimes that happens, but it has really helped them build a partnership and a commercial relationship which has been hugely successful for startups.
One of the personalities we interviewed for the first edition of Masterspeak was Professor David Cheriton from Stanford University. He marveled at the infrastructure that Google has created and said, “With that kind of infrastructure in place, you could do anything that can be delivered over the internet, which opens up enormous possibilities.” Does Google’s infrastructure give it an unfair advantage?
David is very smart but I disagree with him on this point. I think competition has never been stiffer. It is an incredibly competitive market place. Pick any vertical, all the ones that a startup is in or that Google is in or aspires to be in, there is huge competition. That’s because it has never been easier to switch. That is a reality that companies such as Google in the information age have to deal with. Microsoft still has a huge installed base of Windows computers. You can rely on some percentage of those to buy the next version. But it doesn’t work that way anymore. If users don’t like Instagram or something better comes along, they will just delete it.
Historically, big companies aren’t great at seeing disruption coming. So, part of the role of a venture fund is to try and anticipate disruption. If something comes and disrupts Google, we hope that we are invested in it. We want to try and help them succeed at that and kind of be part of it than be dumbstruck when something comes along. I actually think that the infrastructure Google has set up is really important but more important, though, are the people. Google has had aspirations to do a lot of things in lot of areas and lot many a times startups can move faster.
You have a multi-dimensional portfolio comprising companies from different verticals. How do you go about the whole process? Does every idea compete with the other? Or is there an allocation plan in place?
Two answers to that. We don’t want to be a late- or an early-stage fund. We try to build a portfolio based around disruption. The ones we have — Uber, Nest, Slack, Foundation Medicine or Impossible Foods — are all in a way trying to disrupt existing ways of doing business. We try to be diverse around stages [of investment] and about of amount as well.
I have a particular interest in life sciences. We have made investments in life sciences such as Foundation Medicine, which was not an obvious investment at the time. It wasn’t the hottest company in Silicon Valley when we made the investment. But we saw in about three years of so they will have a product that will help people live instead of die. Maybe it won’t work. We had other investments that didn’t work. We invest in companies that we think will be in line with our vision of the future, for example, genomics and medical technology.
Secondly, we don’t care much about ideas — they are cheap. There is a document at Google where anyone can enter any idea they have, which is 10,000 pages long. If someone wants to sell you that document for a dollar, you shouldn’t pay a dollar for it. I could have an idea for an app that lets me call a car from wherever I am and takes me wherever I want to go. That is not worth $50 billion. It is the execution that is. So, we are not looking for great ideas. There are so many ideas out here; right from curing cancer to building a time machine to making commute easy. That is the easy part. The hard part is actually going out and building it. So, we look for people who can execute and want to build things. They know how hard it is and can execute that.
We have about $300 million coming in every year. Roughly speaking, we aim to invest about half of that in reserve and half of that for follow-on investments in investee companies in future years. But when we see something really amazing, where we see others aren’t seeing that, we can write a bigger cheque but some of these things aren’t obvious. So, I don’t think about it as ideas or areas, I think of it more as finding people who can build things.
Is your optimism around life sciences driven by the thinking that breakthrough innovation in medical science, in future, is going to be more mathematical or algorithmically driven than by science and chemistry?
I think life sciences is the single-most important area that we can invest in. What is happening right now is that there is a collision between technology and life sciences that started with the human genome project. And that has enabled the equivalent of a transistor for computers. It is like the very basic building block to understand. So you can diagnose diseases, develop therapies to treat them and that just began in 2004. Billions of dollars spent and after ten years you find that one genome sequence. You build an iPhone that is worth something, but it took billions of dollars and several years.
It is part of a network. Now you have lots of genome sequence, and with the cost now falling to $1,000 [per genome] that is critical. For me, it is the most interesting and important place to invest because those tools that you mentioned, such as machine learning, will enable acceleration of something that is really important — which is to help people live longer, healthier lives. You can have more years to live and also more life in your years. Doctors and scientists have strived for this for so many years but have not had the tools. Understanding ageing requires an understanding of genetic conditions.
Until you can read the genome, you are just treating things symptomatically. Now we have the tools and machine learning provides a skill and an ability to solve problems with the speed that you could never do as an individual before. That should be celebrated. The next 10-15 years will really surprise people with the breakthroughs that come in healthcare and life sciences.
Which are the three most exciting ideas in your portfolio?
I love all my children equally. I’ll tell you the first three. Obviously, I think Uber is one of the most transformative, fastest growing, significant companies we have seen in terms of how people live their lives. Owning a car is the second most valuable asset that people own next to their house and lots of people don’t own houses. But it is a depreciating asset that sits idle most of the time. It is just rusting. I know young people who don’t aspire to own cars. That is a big difference from ten or even five years ago.
When I was growing up, car meant freedom. Now, Uber is freedom. That is a huge change. You don’t have to spend $30,000. That is a huge chunk of money on a car. Instead, you can have an app that can take you places, maybe deliver you things. You can track where your kids are going; it is just safer and better in every way. It is super important and really disruptive. It has also been empowering a generation of entrepreneurs who can go out and work the hours that they want, in the places they want and earn their own living.
Of all the things we do, empowering entrepreneurship is really transformative. You own your own time. There are a lot of interesting stories particularly about single moms. You have no ability to go a nine-to-five job because you have to be with the kids, but if you can do Uber in those hours that can really change things for you. Uber is one of those super important tools. It is also one of the fastest growing companies I have ever seen. It is like a public service in a way. You go to Vancouver where I was recently where there is no Uber — it is banned. And I stood on a street corner for an hour waiting for a taxi that never came.
You don’t think about the electricity until suddenly it is out or clean water till you don’t have it anymore. Uber for a lot of people is becoming that, you just expect that I shall be able to call a car. When you think about the technology that underlays that and enables it to happen — cell towers and software and phones — it is just this moment in time that it has ever been possible. It is the first time in history that you can envision something that you can push out to billions of people. That is really important.
Another story I love is Slack — it is a really interesting company where the entrepreneur, Stewart Butterfield is a unique thinker. He is someone I have known for a number of years. Slack is a new kind of collaboration and communication tool for businesses. It is not a super sexy consumer app but when you see how it actually works and experience it, it is really an interesting product. That is also one of the fastest growing companies and people love the product. When you find something that people love that kind of signals something interesting is going on.
And then in life sciences, we have Flatiron Health — our second-largest investment — set up by two ex-Googlers who started Invite Media, which they sold to Google. They are collecting oncology records from around the world and helping to ingest all the information, which is, basically, not in a standard format. It is written records. It is one form of medical records that they are standardising. So, for the first time oncologists and, eventually, other types of doctors can look at a patient and say, “I have a patient with stage two lymphoma, how has every other patient been treated for this? What have been the outcomes?”
Google Ventures' hot picks
That would lead them to different treatments than what the gold standard would imply necessarily. That is just a data collection and organisation task. That is something that Google obviously knows a bit about — collecting large amounts of data, organising it and then trying to derive insights from it and provide that to end users to give them value. They are doing that in healthcare right now. It is incredibly important. It is not the hottest idea that gets attention on television but incredibly important because being able to organise that information is the first step to better treatment.
What distinguishes each of these companies is that they have dynamic entrepreneurs. If I put you in a room with any of them, I bet you will have an interesting conversation with them. These people have a unique take on something and this is what makes venture capital an adventure.
Is there any one idea that is close to your heart?
The team that I built is very close to my heart. I adore the people I work with. But beyond that, the two areas I feel for strongly are machine learning and healthcare. They are emerging very quickly and are going to be transformative not in a way such as Facebook or Instagram are. There you can save moments, you can record them, and share them with people — that is fun and interesting, important and great. But these will be transformative in a way that you might live five years longer than you might have otherwise. A friend of mine, Henry Freidman, is working on a treatment for glioblastoma, which is one of the worst cancers you can get. It doubles in size every two weeks, it always comes back and there is no cure. It, essentially, is a death sentence.
But Henry and a team from Duke Cancer Institute have engineered a polio virus to go in and kill the tumour. So, for the first time there are 11 patients who have survived, several of whom, are as far as anyone can tell, free of cancer. No one wants to say ‘cured’ at this point. But these are things that could not have been done 10 years ago and that can be done now. Just like you couldn’t create Instagram 10 years ago, you could make the app but no one could download it, there was no network, there was no one to share photos with, there wasn’t enough bandwidth. I think what most people don’t understand is that in healthcare things that are now enabled that were never possible before. Now you can actually understand the biological basis of ageing and diseases.
That is the most important thing to me because if we are fortunate to live long enough we will lose people to Parkinson’s, Alzheimer’s and all these terrible diseases. Fortunately, there is no longer small pox. These things had been eliminated. We will eventually live in a world where maybe our kids will look back and say, “I can’t believe they used to die of cancer.” That is coming very quickly and that is super-exciting and really important to me.
Five years out where do you see this convergence between technology and life sciences? What kind of breakthroughs do you foresee?
The trends that you see now around high throughput sequencing, it’s becoming less expensive very quickly where we are able to accelerate the whole research process. Right now, for example, if there is an unknown pathogen out in the world we can sequence it and know what it is within a day. We are going to move from a place where we describe disease at the anatomic level into what we describe and treat at the molecular level. That’s a huge difference. We are going to be very specific and not geographic any more. Saying it is a lymphoma or breast cancer it is not very specific. One of my friends at Google says describing disease that way (anatomic) is like flying over Paris in a helicopter and being asked over the phone what you see down there.
You say, “Oh, there is Eiffel Tower!” But now we can edit genes, we can read genes, so we can figure out what is a cancerous gene and we can fix it. There are complex diseases such as Alzheimer’s or Parkinson’s where we don’t know the cause, where we are going to understand fundamentally what is going on. Is it a virus or is it some genetic abnormality? Once we can start to understand that, we can start to repair those things as well. I have to mention stem cell is a very important area too. In fact, genome mix, regenerative medicine and immunotherapy are all incredibly important areas. Basically, it’s about using your own body to repair your own body. Now, we have all the tools. It is just about execution and it is inevitable in my view. I don’t know if it is in the next three years, five, eight years, but it will happen in that timeframe.
Can you name some companies that are at the cutting edge of what you just spoke about?
There are a number of companies that I have in my mind that no one knows about. There are researchers at universities who are helping to spin out technologies. Apart from companies in our portfolio, there are institutions such as the Howard Hughes Medical Institute, which is doing great work. We are not investors there as it is a non-profit. It is one of the most incredible, effective and powerful institutions in healthcare, completely under talked about, underrated with lots of smart people and intelligent researchers: $18 billion endowment, a billion dollars a year invested into areas that is causing transformation and change to happen.
We had iPierian that was bought by Bristol-Myers Squibb. The intellectual founder of the company won the Noble Prize for his work around stem cells. Then we have got Foundation Medicine, which has a test to genotypes cancers so that doctors and physicians can figure out what kind of tests and treatments would be most appropriate against a tumour, irrelevant in what part of your body it happens to be in. There are actually a number of companies we have invested in that we haven’t really announced. Some will fail and you will never hear about them. But they had a great vision and they tried. And there are some that you probably will hear about someday, just not today!