GE Ventures wants to sell its portfolio of more than 100 startups.
Sources told CNBC the move is is designed to help parent company General Electric pay off some if its $110 million of debt. Late last year the company also sold a majority stake in ServiceMax, which it had acquired in November of 2016 for $915 million.
Launched in 2013 by by Sue Siegel, who is now GE’s chief innovation officer and remains CEO of the ventures arm, GE Ventures is currently in discussions with other venture firms, as well some limited partners who invest in those funds. It has hired investment bank Lazard to manage the process. Lazard declined to comment on the report.
GE Ventures has invested in startups in areas including energy, technology and health care, with a portfolio that boasts Evidation Health, which focuses on clinical studies; Verana Health, a patient-focused life sciences company; and augmented reality software developer Upskill.
While selling an entire venture portfolio won’t be easy, GE is reportedly adamant that it doesn’t want to sell its investments in pieces.
“During this time of transformation for GE, we are evaluating strategic options for GE Ventures to continue delivering returns for our shareholders and partners,” said Megan Newhouse, a GE spokesperson, in a statement. “While we can’t comment specifically on that process, we remain committed to supporting our portfolio companies, business units and partnering with the entrepreneurial ecosystem.”
The news comes after several executives at GE Ventures have left their positions in recent months, including Lisa Suennen, Noah Lewis and Jessica Zeaske.
Although the company is carrying heavy debt, GE continues to spend cash during what CEO Larry Culp is calling a multiyear turnaround. GE Capital reduced its liabilities in the first quarter, completing $1.1 billion in asset reductions in the period, but the company’s stock is down 23 percent over the past 12 months.
Google and Amazon reportedly see an opportunity to gain ground in the government software market amid the Department of Government Efficiency’s (DOGE) efforts to reduce waste and inefficiency in the federal government.
DOGE has focused in part on the software used by the government, and it has been estimated that the companies’ rival, Microsoft, accounts for about 31% of the amount 24 federal agencies spend on software licenses, Bloomberg reported Friday (April 4).
Google and Amazon are working through trade groups to lobby members of Congress and the DOGE liaisons at federal agencies, suggesting that government agencies could save money by opening up contracts to more companies and avoiding “predatory” licensing agreements, according to the report.
Google aims to provide more software to government agencies, while Amazon is focusing on cloud computing, the report said.
Microsoft spokesperson Alex Haurek told Bloomberg, per the report, that it is “concerning but unsurprising to see certain industry players trying to manipulate decision makers, through shadowy front groups, rather than competing transparently on price and quality.”
Google spokesperson José Castañeda said in the report: “We’ve said for ages that government IT needs more competition to save taxpayers money and improve security, so it’s no surprise that legacy players prefer the status quo and criticize those who want change.”
DOGE was created in January with an executive order from President Donald Trump and was tasked with updating software and technology to boost efficiency and productivity within the federal government.
It was reported March 28 that DOGE was working on an overhaul of Social Security Administration computer systems, migrating the agency’s computer system of its longtime computer programming and onto a more modern equivalent.
On the same day, when Trump signed an executive order setting a Sept. 30 deadline for the federal government to stop issuing paper checks for disbursements, it was reported that DOGE estimated the Treasury Department could save $750 million by eliminating paper checks and associated lockbox maintenance.
Global professional services organization Accenture said March 20 that it had lost sales and revenue in its Accenture Federal Services businesses unit and faces continuing uncertainty due to the Trump administration’s efforts to operate the government more efficiently.
