Dive Brief:
- CapitalG, the early stage investment arm of Google parent company Alphabet, has invested in both Snap Inc. and Airbnb, according to TheStreet. CapitalG hasn’t disclosed the amount of either investment.
- The investment in Snap Inc., Snapchat’s parent company, comes in advance of the video messaging app's expected $25 billion-plus IPO next March.
- Google has been upping its travel capabilities through one-stop shop apps like Trips, making Airbnb a logical fit. Snap Inc. has made moves into wearables of late, and TheStreet points out that products like Snap's Spectacles in some ways recall failed Google Glass.
Dive Insight:
While it isn't known how much of a stake Alphabet has taken in either Snap or Airbnb, the news still suggests that the company is hedging its bets as the digital space continues to evolve. Alphabet is facing competition on several fronts and by building a connection with two of the fastest growing apps, the company is signaling a couple of areas where it sees digital headed.
The Snap Inc. investment comes as Alphabet considers ways to go on the defensive against Facebook: Google often directly competes for advertiser dollars with Facebook, especially now that Google AMPs and Facebook Instant Articles have ramped up their offerings in recent months.
Snapchat also brushes up against Facebook in the social space, and the latter has introduced myriad features that ape Snapchat's content model (Facebook failed to buy Snapchat for $3 billion in 2013). A financial Snap-Google bond could be a formidable force for Facebook to consider, despite the fact that it remains dominant in the social space, with over 1 billion daily active users on mobile alone.
In regards to Airbnb, the investment shows that travel continues to be a space Google has a keen eye on.
Google’s most recent travel-related news was the release of its Trips app in late September. The service is touted as a “personalized tour guide” for mobile-minded travelers, and allows users to make reservations, get trip suggestions and do general itinerary planning, all in one space.
