googlevc.bmpGoogle has committed money to two Indian venture capital firms, saying fledgling companies in India with good ideas have too few avenues for financial support.

Google invested undisclosed amounts into small venture firms Seedfund and Erasmic. The amounts were likely in the single digit millions.

This continues Google’s experiment with different forms of corporate development. The move is significant because the rap on corporate investors is that they’re unreliable — enthusiastically supporting companies when times are good, but then withdrawing when their stock price is down and shareholders demand renewed focus on core business. Last year, Google began investing directly into start-ups, including WiFI router company FON, and another WiFi router company Meraki. Overall, these investments have been very small, relative to the hundreds of millions invested by other large companies, such as Intel.

Red Herring first wrote about the Google VC move a couple of weeks ago, and Samir Sood, Google’s head of corporate development in South Asia has since sent out a statement, explaining the move: “While the rush of large amounts of venture capital into India is well-documented, very little of this trickles down to the really small firms, the early-stage start-ups.”

Silicon Valley firms Sierra Ventures and Mayfield reported investments into India’s Seedfund (see here and here). Mayfield said Seedfund’s fund will be $15 million in total. Other Seedfund backers are Motorola Ventures, Reliance ADA Group, SVB Financial Group, an affiliate of Silicon Valley Bank, reports VentureWire.

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