How does this solution work? Does every team work this way? Is there no HR but only local administration? Or is it only a few teams who get this privilege? How do you avoid us vs. Them mentality in that situation?
Often companies get excited about a new idea, staff and finance them well… then after a year or two they get thrown into the wider system and expected to survive.
Eventually they are absorbed and managed as if they are the old cash cow, needing layers of management, risk adversion, accelerated timelines, and new ‘processes’ to fix every small problem instead of focusing on the bigger picture.
Spin "the other bets" out as a separate company.
Capitalize it separately.
Literally just don't have it as part of the parent company.
The only advantage of having the company inside the "parent" increasingly becomes accounting tricks.
Concealing excess profits via shuffling them to the "other bet" is the biggest trick of them all.
All publicly listed companies actively hide profits from shareholders.
Who might want the capital as a dividend.
Aha, glad somebody is seeing the same thing I'm seeing.
The problem with Google is that it is too large, and too successful. Their idea of having experimental projects is a good one, the problem is that Google makes so much money that they don't commit to them. They become too dilettante about them.
The fix is to do spin-offs, say keeping a minority stake at less than 20%. This generates capital for Google, gives them a share of the upside, but they don't have too much influence on the spin-off. So it's Death or Glory for the spin-off. They are forced to make whatever it is they invented work, or face extinction. There is a smaller management team, focussed on success.
This strikes me as a much better proposition than what we see at the moment, with Google just dabbling around pouring money into something they'll eventually get bored with.
You'd think that what with all the big brains at Google, someone would have thought of this. Maybe someone at Goldmans should make a pitch.
1) An enormous pile of cash would accumulate on Google's balance sheet. 2) The spinoffs would be subject to normal commercial rules about risk, rate of return and such. 3) The spinoffs couldn't be "brand Google." Which is a not-inconsiderable thing.
Clearly though, it's a good call.