Google sees independent startups as key to new Alphabet reorganization

Google's Andrew Conrad

Google ($GOOG) is planning to give new businesses including its growing Life Sciences division ample breathing room as part of its reorganization, allowing the startups to run more independently as the tech titan rejigs operations and creates its parent company, Alphabet.

The company hasn't made its new structure public yet, The Wall Street Journal reports. But Google plans to give "bets" or startup companies plenty of leeway, letting them do their own hiring, write their own contracts and plan their own marketing campaigns, people familiar with the matter told the newspaper. The plan is meant to benefit both sides, as execs at Google's core business can concentrate on search and advertising and startups can usher through projects at a more rapid clip.

"It's going to get a little faster, more efficient and more independent," Andy Conrad, CEO of Google Life Sciences, told the WSJ. "I act as a CEO of an independent company instead of a senior executive within a large company."

The move represents a win for entrepreneurs, many of whom believe that "it's easier to do … business outside Google rather than inside," said Max Ventilla, a former Google employee who left in 2013 to found an education startup, as quoted by the WSJ. "There's a lot of red tape for head count and money to get through at Google."

An arrangement that allows startups to have more autonomy could help deliver on Alphabet CEO Larry Page's vision of investing 10% on projects in new areas, and could also reduce competition within Google for time, resources and talent.

Conrad, for his part, told the WSJ that he feels freer to make decisions without thinking about their effect on other company businesses. Life Sciences will be a standalone unit under Google's reconceptualized company, moving forward with projects including a diabetes monitoring collaboration with French drugmaker Sanofi ($SNY) and a smart contact lens for diabetes with Novartis ($NVS). "(Google CEO) Sundar (Pichai) will act in the best interests of Google Inc. I will act in the best interests of Google Life Sciences," Conrad said, as quoted by the WSJ.

Meanwhile, Google continues to charge ahead with new projects following its Alphabet announcement with the company's director of engineering, Ray Kurzweil, urging the tech giant to take a deeper dive into robotics, CNET reports. Earlier this year, Google and Johnson & Johnson ($JNJ) said they would team up to create new robotic-assisted surgical platforms.

But Kurzweil sees a future where nanobots are implanted into human brains so they can tap into the Internet--a vision that could impact diagnostics and patient monitoring as Google chases its med tech aspirations.

- read the WSJ story (sub. req.)
- here's the CNET story

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