Updated at 10:35 p.m. PDT with confirmation from Google.
Google has launched a venture capital arm to invest in a diverse array of industries, including the consumer Internet, software, clean tech, and health care.
The fund, which was announced late Monday in a company blog, will be headed by William Maris, an investor and entrepreneur who was hired by Google last year to help set up the venture, and Rich Miner, former manager of Google's mobile platforms group.
Google Ventures, as the fund is called, is expected to receive a $100 million investment from Google in the first year, according to a report on The Wall Street Journal's Web site.
"Central to our effort will be our fellow Googlers, whom we view as a critically important resource to help educate us about potential investments areas and evaluate specific companies," Maris and Miner said in the jointly penned blog.
The new venture will put Google--a company better known for buying companies than investing in them--in the more-formal role of helping get start-ups off the ground. Other Silicon Valley companies with extensive VC track records include Intel, Hewlett-Packard, and Motorola.
Google acknowledged that its timing is awkward, but noted that it also sees opportunity in the current economic climate.
"Economically, times are tough, but great ideas come when they will," the pair said. "If anything, we think the current downturn is an ideal time to invest in nascent companies that have the chance to be the 'next big thing,' and we'll be working hard to find them."
Venture capitalists have put a virtual lock on their funding, doling out a mere $3.4 billion during the fourth quarter of 2008, according to a report released in January by Thomson Reuters and the National Venture Capital Association. The meager performance pales in comparison with the $11.7 billion distributed to start-ups a year ago during the same period, a decline of 71 percent.
During the same period, venture capital investments in IT companies specifically plunged 40 percent to $2.18 billion, the worst level in a decade, according to figures from VentureSource.