Don't startups want to win a big exit though? Google won't need to buy the startup for billions, because the TOS already grants them permission to use all the models and training data for free. Seems like a Faustian bargain to me.
The TOS you are quoting only refers to the information you provide in the survey. Here are the Google Cloud TOS: https://cloud.google.com/terms/ if you're interested in what Cloud does with customers data.
5.2 Use of Customer Data. Google will not access or use Customer Data, except as necessary to provide the Services to Customer.
Your training data and models are secure.
Also, even Google's general consume terms of service really isn't what you think: https://www.google.com/policies/terms/
"You retain ownership of any intellectual property rights that you hold in that content. In short, what belongs to you stays yours."
1) AI startups usually don't have a lot of value to potential acquirers based on their data, but based on other things (e.g., talent, customers, business model, platform, brand). That's like saying you shouldn't use AWS because Amazon can just steal and commercialize all your data.
2) There are other companies than Google that acquire startups
Having said that, I highly doubt that Google can just use all the training data to on GCloud to launch their own products with that. They can surely look at it and maybe do stuff with them internally, but I am pretty sure that they can't use them commercially.
How would you ever know if they did? People who worked at Google have been accused, by Google, of stealing the entire self driving car program and taking it to a competitor.
It's also vastly different. Of course someone working at at google on a project has access to that project. It doesn't mean they have access to your stuff.
Hard to get employees to not steal from you if you are stealing from your customers.
I shiggy diggy.