Google starts venture capital unit

Google Inc. has started a venture capital unit to fund new technologies.

Google Ventures will invest $100 million in its first year and mostly target young companies, said Bill Maris, a managing director of the unit. The fund will invest in consumer-oriented Internet companies, healthcare, robotics and nanotechnology, he said.

“We’re not ruling anything out” in terms of investment areas, Maris added.

The unit may help Google tap technologies that benefit the Mountain View, Calif., company’s business, said Rich Miner, also a managing director of the venture. The fund may also boost Google’s returns from investments as the company cuts costs amid lower spending on advertising by businesses.

Google Ventures may also invest some of the initial $100 million in later-stage companies, Maris said.

Fundraising in the industry in the U.S. fell 71% last quarter as universities and other investors shied away from young firms amid the credit crunch and recession, according to the National Venture Capital Assn.