Google Watching

  • James H. Lee

Google Glass Model

As I pass my 44th birthday, it is easy to look at everything that Google is doing with a certain degree of wistfulness and envy.  Now just 15 years of age, Google has already surpassed many of my accomplishments.

• While not yet old enough to get a driver’s license, Google’s self-driving car logged-in 500,000 miles without a single accident.   It (presumably) has a much better sense of direction and doesn’t “space out” at stop lights.

• My grasp of the French language is so confused that I can get native speakers lost in their own country.  Meanwhile, Google’s online tools can translate over 70 different written languages to English.  The company is also extremely close to practical real-time speech translation for the Android operating system.

• From the perspective of personal health, my vision is fairly good -- yet the new Google Glass (pictured) can potentially have near-perfect facial recognition and see into something called “augmented reality” – using digital overlays to project location-specific information onto the real world.  My personal OS is still stuck in version 1.0, a freeware project better known as “an overactive imagination.”

But all is forgiven, because Google might make us healthier and wealthier.  Through its subsidiary, Google Ventures, the company recently announced an investment in California Life Company (Calico), which hopes to extending human life by 20 to 100 years.   Google also has made a significant early-stage investment in personal genomics innovator 23andMe and dozens of other internet-related start-ups.   It is quickly becoming a top-tier VC firm and plans to invest close to $300 million per year.

Some may call these pursuits excessively ambitious, but a whole lot of smarts (and even deeper pockets) can make a little eccentricity go a long, long way.

It is simply too early to say if Google’s foray into venture capital will be successful; by almost any other measure, it is a wildly successful company.   Their profits have grown at an annualized rate of 56% over the past decade and they maintain extremely respectable levels of profitability.  Trading at 25x current earnings for $1,000 per share, this could hardly be considered a cheap stock.  Regardless, it certainly bears watching and is worth buying on price weakness. 

While we might not be able to save the world like Google, we can still own a piece of it in our portfolios…

(Disclosure: Information contained herein is for educational purposes only and is not to be considered a recommendation to buy or sell any security or investment advice. Mr. Lee is the Founder of Strategic Foresight Investments, a registered investment advisor, and holds shares of Google in client accounts as of November 11, 2013)